Ground Cover North : Ground Cover 056 June-July 2005 - North
21 Biofuels JUNE/JULY 2005 GROUND COVER NEW PRODUCTS The GRDC view on biofuels GRDC's executive manager for New Products, Vince Logan, says any increase in the use of biofuels in Australia will require investment in new technologies. He says there is tre- mendous interest within the grains industry in alternative fuels since the rise in oil prices. However, while the production of biofuels such as ethanol is a fairly established process, he says the GRDC is keen to investigate the use of new technologies that better use whole plants and not just the grain. Mr Logan believes that new technology will change the econom- ics of biofuel production. Overseas research indicates that production costs can be cut with the use of new technology, such as genetically modified E. coli bacteria to produce ethanol from biomass, making ethanol comparable, or cheaper, than petroleum-based fuels. "The GRDC is currently identifying what role it could have in helping to bring this technol- ogy to Australia." Mr Logan is also interested in the opportunities for Australian graingrowers to invest in ethanol production, based on US corngrowers' experiences. Across the US, small production plants have been established by growers and this is something the GRDC would be keen to see replicated here, he says: "It gives growers the chance to share in the new opportuni- ties available. Financial institutions such as Suncorp are taking a keen interest in the development of an ethanol industry." While research and development is key to making biofuels more viable to the Australian market, other factors are also important and include the cost of oil and government regulation. "If oil prices were to remain at current lev- els or increase, then consumption patterns would severely shift. Similarly, if the govern- ment regulated that all fuel must contain a percentage of ethanol, then this would also impact on the market," he adds. Crop energy drives future prospects A number of companies are developing biofuel ventures, which not only offer a fuel alternative but also potential economic windfalls to rural economies n Providing another outlet for grain would be a highly valuable addition to the economic landscape in rural districts, adding new industries and also adding a market alternative for graingrowers, the emerging biofuel industry says. As chairman of the WA-based Australian Ethanol company, Peter Anderton, says: "If a grower can go into a season knowing that even in a bad year, he or she can get a return from poor quality grain through an outlet like ethanol, then it's clearly a very worthwhile development." Australian Ethanol is planning a 90 million litre capacity ethanol plant in Swan Hill, Victoria, using 250,000-tonne of corn, wheat and barley as feedstock annually. It is in the process of raising finance to get the project off the ground. It is one of a number of projects in regional Australia that aim to process and promote biofuels from Australian grain. Another includes south Queensland's Dalby Bio-Refinery, while NSW-based Manildra group has been producing biofuels for about 15 years. All three companies believe that a vibrant biofuels industry offers graingrowers significant potential; stimulating competition, reducing the reliance on exports, and providing environmental benefits overall. Mr Anderton says that Australian Ethanol's Swan Hill site, on the Murray River in northern Victoria, will offer the region a new economic structure. The irrigated side of Swan Hill produces rice, the dry side wheat and barley. He hopes to help convert part of the rice-growing district to corn production, easing the pressures faced by rice growers, while providing a feedstock for the ethanol plant. "Rice growers face import tariffs when they export, and rice uses a lot of water -- double what corn needs." The non-irrigated side of Swan Hill could supply the ethanol plant with wheat and barley, providing growers with an alternative market. Mr Anderton says ethanol plants offer regional Australia enormous opportunities as seen already in the US. However, he says ethanol has been slow to take off in Australia because fuel retailers need a guaranteed supply: "It's a Catch 22 situation -- there is no demand because there is no supply, and no supply because there is no demand." This is why he argues that government support is needed to get the industry moving. Peter Simpson, general manager of Manildra, Australia's largest user of wheat for industrial purposes, agrees, saying government legislation is needed. Manildra has been producing ethanol for 15 years and has capacity to make 100 million litres a year, supplying independent service stations in NSW. "Environmentally and economically, ethanol offers huge benefits," Mr Simpson says. "It is a renewable fuel, can cut greenhouse gas emissions and it gives growers options." Chris Harrison, director of south Queensland's Dalby Bio-Refinery -- a plant that when completed will use 200,000 tonnes of corn, sorghum and wheat a year -- concurs. While the Australian Government has provided a framework for biofuels and awarded a series of capital grants, under the $37.6 million grant scheme, those in the fledgling industry say too little has been done to stimulate the market. Mr Harrison says development is needed now, with predictions of crude oil pricing exceeding $US100 a barrel by 2010 and countries like Brazil and America already 20 years ahead of Australia. For more information: Peter Simpson, 02 8863 6261, email@example.com; Peter Anderton, 08 9322 9110, www.australianethanol.com.au BIODIESEL Cost savings not enough Fearnes, the Wagga Wagga-based bus line with a fleet of 60 coaches and buses, con- cluded an exhaustive test of biodiesel in July 2002 and will not be tempted to repeat the experiment. Blocked filters, reduced kilometres per litre and other practical problems did not outweigh the 15 cents a litre cost-saving. The company was using 20,000 litres a week and while continuity of supply was not an issue, it says quality was. Biodiesel is a combination of vegetable oil, animal fats, ethanol or methanol and a catalyst. The most cost-effective raw material for its manufacture is recycled cooking oil or tallow, but the commonly used cooking oils have a gel point too high for normal use -- and getting the blend of canola oil or a similar vegetable oil right is critical. Fearnes reports problems with blocked filters during cold weather and a higher than normal burn-out of injectors. The estimated 10 per cent reduction in fuel efficiency also led to some embarrassing incidents on the company's longer coach runs. And biodiesel's performance dur- ing tank fill caused some unexpected problems -- the fuel does not foam under pressure like diesel, and the foam is need to trigger the cut-off on automatic nozzles. The company says it lost hundreds of litres of fuel when unattended nozzles did not shut off. While the company says that it would not use biodiesel on a straight basis again, it would consider it as a premix. Biodiesel is offered in the US in a two or a five per cent blend with low-sulfur diesel fuel to compensate for the loss in its lubricating capacity. -- Alec Nicol THE MOST COST-EFFECTIVE RAW MATERIAL FOR ITS MANUFACTURE IS RECYCLED COOKING OIL OR TALLOW, BUT THE COMMONLY USED COOKING OILS HAVE A GEL POINT TOO HIGH FOR NORMAL USE -- AND GETTING THE BLEND OF CANOLA OIL OR A SIMILAR VEGETABLE OIL RIGHT IS CRITICAL.
Ground Cover 057 August-September 2005 - North
Ground Cover 055 April-May 2005 - North