Techno-economic analysis of biotrade chains: Upgraded biofuels from Russia and from Canada to the Netherlands

Paterson McKeough, Yrjö Solantausta, Hilkka Kyllönen, Andre Faaij, Carlo Hamelinck, Martijn Wagener, David Beckman, Björn Kjellström

    Research output: Book/ReportReport

    2 Citations (Scopus)


    This study consisted of in-depth techno-economic analyses of biofuel upgrading processes and of whole biotrade chains. The chains encompassed the production of pyrolysis oil or pellets from biomass residues in the source regions, the transportation of the upgraded fuels internationally over long distances and the final utilisation of the fuels. The techno-economic analysis of the biofuel upgrading processes was undertaken primarily to generate techno-economic data that were needed as input data for the assessment of the biotrade chains. The evaluation of pyrolysis-oil production was deemed to be one of the most reliable assessments made to date. The estimated pyrolysis-oil production costs, e.g. below 25 EUR/MWh for stand-alone production from forestry residues, compare favourably with the current consumer-prices of heavy fuel oil in many European countries. Integration of the pyrolysis process with an industrial combined heat and power (CHP) plant would lower the production costs by more than 20%. The production of pellets was assessed to be somewhat more energy-efficient and more cost-efficient than the production of pyrolysis oil. However, the higher production costs of pyrolysis oil would be counteracted by lower costs in connection with product handling and utilisation. Four international biotrade chains were analysed in detail. The chains cover two source regions, North-Western Russia and Eastern Canada, and two traded commodities, pyrolysis oil and pellets. The chains terminate in the Netherlands where the imported biofuels are co-fired with coal in condensing power stations. The costs of the delivered biofuels were estimated to be in the range 18-30 EUR/MWh, with the costs of pellets about 25% lower than those of pyrolysis oil. The estimated electricity-generation costs displayed little dependence on the type of biofuel - pyrolysis oil or pellets - because the costs associated with the utilisation of the biofuels for co-firing are higher for the pellets. For the Canada-Netherlands chains based on zero-cost sawmilling residues, the costs of the delivered biofuels were estimated to be about 20% lower, and the electricity-generation costs about 10% lower, than those of the Russia-Netherlands chains. With the electricity consumption calculated as the equivalent amount of fuel that would be needed for its generation, the energy consumptions of the biotrade chains, prior to the end-use of the biofuels, were estimated to be in the range 13-23% of the energy content of the original biomass residues. Local-utilisation alternatives were also evaluated. It was concluded that, particularly when the local reference energy system is carbon intensive, local utilisation can be a more cost-efficient and a more resource-efficient option than international trade and use of biomass resources elsewhere. This type of comparison is, however, very dependent on both the greenhouse-gas emission intensities and the costs of the reference energy systems in the exporting and importing regions. In practice, there are many factors which may limit local utilisation or make utilisation of biomass resources elsewhere more attractive. Obviously, when increased local utilisation is not feasible, exporting surplus biofuel is a highly beneficial and fully justified option. Other drivers for international bio-energy trade, such as improving access to markets, developing biomass production potentials over time and securing stable supply and demand, fuel supply security and other issues were not part of the present work programme. Overall, it was concluded that biotrade will have a definite and important role to play in reducing humankind's dependency on fossil fuels.
    Original languageEnglish
    Place of PublicationEspoo
    PublisherVTT Technical Research Centre of Finland
    Number of pages69
    ISBN (Electronic)951-38-6746-3
    ISBN (Print)951-38-6745-5
    Publication statusPublished - 2005
    MoE publication typeNot Eligible

    Publication series

    SeriesVTT Tiedotteita - Meddelanden - Research Notes


    • biofuels
    • upgrading
    • fuel trade
    • pyrolysis oils
    • pellets
    • techno-economy assessment
    • trade chains
    • Russia
    • Netherlands
    • Canada


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