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Market Uptake Support for Intermediate Bioenergy Carriers

Periodic Reporting for period 1 - MUSIC (Market Uptake Support for Intermediate Bioenergy Carriers)

Reporting period: 2019-09-01 to 2021-02-28

In the last decades it has become increasingly clear that fossil fuel resources are scarce, finite and their use can harm the environment and our climate. Besides reducing our CO2 emissions – a need recognised in the Paris Agreement (2015) – increasing renewable energy production will ensure enhanced security of supply, more innovation, jobs and growth.

Bioenergy is an essential form of renewable energy, providing an estimated 60% of EU’s renewable energy production in 2017. Bioenergy is a complex and sometimes controversial topic. There is an increasing understanding that only bioenergy that is supplied and used in a sustainable manner has a place in a low carbon energy future.

Intermediate bioenergy carriers (IBC) are formed when biomass is processed to energetically denser, storable and transportable intermediary products analogous to coal, oil and gaseous fossil energy carriers. These IBCs can be further refined to final bioenergy or bio-based products or directly used for heat and power generation. Despite the fact that the use of IBC introduces an extra conversion step - with associated financial and energy costs– there are significant advantages to the use of IBC as compared to raw biomass, and reputable companies are working on their deployment. Current application remains however modest, compared to the direct conversion of biomass to energy. With the MUSIC project, wider implementation of different kinds of IBCs is facilitated, including torrefied biomass, pyrolysis oil and microbial oil.

The overall objective of the MUSIC project is to facilitate the further introduction of intermediate bioenergy carriers by developing feedstock mobilisation strategies, improving logistics and development of IBC trade centres.
The core actions in MUSIC are: Mapping of the current status of, and framework for, IBC implementation activities, studying markets, technologies and support policies (WP2); Active engagement of regional stakeholders and assessing their views on IBCs (WP3); Development and/or application of regional biomass supply chain optimization tools (WP4), Preparation of advanced case studies (on value chain assessment) and strategic case studies (expansion strategies) for market up-take of IBCs (WP5), engaging the broader industry through working groups (WP7), summarise key findings and elaborate policy recommendations for industrial stakeholders and policymakers (WP6) and wider dissemination of project results and findings (WP8).

In P1 the state-of-the-art of biomass mobilisation and IBC logistics, trade centres and industrial production was mapped, building on results/outcomes of earlier EU projects/activities. Engaging with stakeholders the potential IBC contribution to 2030 EU energy policy targets was assessed. The legal, institutional and political framework conditions at EU level and at the level of case study countries was identified and summarised in a framework conditions report. In the project separate attention is paid to providing advice to policy makers on European and national level. The first summary paper for policy makers, recapping all mapping findings on the perspective for IBCs uptake, obtained from desk research, case study development, expert interviews and online workshops, has been produced.

Through a range of formats, and taking into account Covid-19 restrictions, initial data (e.g. on the macro-environment, using the PESTEL+I method) was collected from relevant stakeholders to help identify hindrances and enablers for IBC market uptake and to get an overview of the “bigger picture”.

Biomass mobilisation and chain optimisation software tools were assessed and developed/applied for local use with a view to assess regional biomass flows and to facilitate regional biomass trade for each case study. GIS-based tools that help finding optimal size and locations for biomass conversion and storage facilities include the MUSIC-MyGIS model (Greece), the INFER-NRG model (Italy), two Swedish models to optimise (i) the supply of different wood assortments, including residues, and (ii) sawdust shipping costs and the siting of a IBC facility, and a biomass supply costs optimisation model (Greece).
In addition, a smart phone app tool, called binter (Biomass INTERmediates), was developed (Greece). binter facilitates farmers to declare the available biomass by registering their biomass production, collectors/transporters to follow changes in biomass availability via Google Maps and book the one they are interested in and finally end-users to declare their preferences in biomass (types, quantities, time period) and follow the changes in biomass availability

A series of advanced case studies for market up-take of IBCs was conducted. The case studies are characterised by strong industrial participation, ranging from SMEs to large multinationals. In four case study regions (Sweden/Finland, Italy, Greece, and International) value chains were assessed and business plans (reflecting a production scale appropriate for implementation in the near future) were prepared . In each case study the economic viability of IBC production, considering availability of renewable energy support schemes and carbon allowances, was assessed.

With regard to the Industry Platform, an Industrial Advisory Board was set-up, a database of market actors was established, the industrial sectors to be addressed in Industry Working Groups were determined. Information on the technical, economic, environmental and political drivers and barriers of IBCs was collected and assessed through an survey with the biomass torrefaction, biomass pyrolysis and microbial oil industries respectively.

The overall picture that emerges is that there are many (potential) uses for IBCs, as e.g. energy carrier, reductant, or feedstock for bio-based products, but the market is still young and the EU market volume is relatively small.
MUSIC is expected to:

- Facilitate the introduction of these technologies and increase the share of renewable energy in the final energy consumption;
- Lead to substantial and measurable reductions for project developments, whilst still fully addressing the needs for environmental impact assessments and public engagement;
- Develop more informed policy, market support and financial frameworks, notably at national, regional and local level, leading to more cost-effective support schemes and lower financing costs for RES facilities.

The three impacts are all expected to lead to market uptake of IBCs (in particular torrefied biomass, pyrolysis oil and microbial oil), for stand-alone use, or combined use with fossil resources, in sectors such as: steel mills, cement kilns and other energy intensive industries, oil refineries for production of advanced biofuels

MUSIC is expected to lead to more bioenergy production in these industries due to 1) the expected implementation of (part of) the developed value chains, and 2) because of the many other activities that will – more indirectly - facilitate market uptake of IBCs.
The renewable energy that is to be produced in the case all the case studies are implemented is substantial, totalling 4.66 PJ/year (all advanced case studies combined) or even 17.33 PJ/year (all strategic case studies combined). Main reason for these substantial numbers is the medium/large scale industrial focus of the MUSIC project.