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h i g h l i g h t s
" We model an updated 2000 metric ton per day fast pyrolysis and hydroprocessing system.
" We incorporate recent commercialization and literature data on the pathway.
" We present the results of a techno-economic analysis of this system.
" We compare these results with those published in a 2010 Iowa State University study.
a r t i c l e
i n f o
Article history:
Received 13 April 2012
Received in revised form 6 November 2012
Accepted 8 November 2012
Available online 1 December 2012
Keywords:
Fast pyrolysis
Hydroprocessing
Catalytic pyrolysis
Techno-economic analysis
a b s t r a c t
A previous Iowa State University (ISU) analysis published in 2010 investigated the technical and economic feasibility of the fast pyrolysis and hydroprocessing of biomass, and concluded that the pathway
could produce cellulosic biofuels for a minimum fuel selling price (MFSP) of $2.11/gal. The 2010 ISU study
was largely theoretical in that no commercial-scale fast pyrolysis facilities were being constructed at the
time of publication.
The present analysis expands upon the 2010 ISU study by performing an updated techno-economic
analysis of the fast pyrolysis and hydroprocessing pathway. Recent advances in pathway technology
and commercialization and new parameters suggested by the recent literature are accounted for. The
MFSP for a 2000 MTPD facility employing fast pyrolysis and hydroprocessing to convert corn stover to
gasoline and diesel fuel is calculated to quantify the economic feasibility of the pathway.
The present analysis determines the MFSP of gasoline and diesel fuel produced via fast pyrolysis and
hydroprocessing to be $2.57/gal. This result indicates that the pathway could be competitive with petroleum, although not as competitive as suggested by the 2010 ISU study. The present analysis also demonstrates the sensitivity of the result to process assumptions.
2012 Elsevier Ltd. All rights reserved.
1. Introduction
The Renewable Fuel Standard (RFS) was created in 2005 by Congress to mandate the domestic consumption of ethanol, particularly grain ethanol [1]. Concerns that the use of grains to produce
ethanol was causing both rainforest destruction [2] and hunger
in the developing world [3] led Congress to direct the Environmental Protection Agency (EPA) to revise the RFS in a manner that
placed greater emphasis on cellulosic biofuels [4]. While grain ethanol production has had little difculty meeting its share of the revised mandate (RFS2), cellulosic biofuels have fallen far short. The
RFS2 initially mandated the production of 250 million gallons per
year (MGY) of cellulosic biofuels in 2011, although no commer Corresponding author.
E-mail address: trb6c4@iastate.edu (T.R. Brown).
0016-2361/$ - see front matter 2012 Elsevier Ltd. All rights reserved.
http://dx.doi.org/10.1016/j.fuel.2012.11.029
cial-scale production occurred [5]. The RFS2 mandates the production of 16,000 MGY of cellulosic biofuels by 2022 [4].
In 2010 Iowa State University (ISU) researchers assessed the
technical and economic feasibility of three different cellulosic biofuel pathways (cellulosic ethanol; gasication and FischerTropsch
synthesis; and fast pyrolysis and hydroprocessing) and identied
fast pyrolysis (FP) and hydroprocessing as being the most economically feasible of the three [68]. Specically, the researchers calculated the minimum fuel selling price (MFSP) of gasoline and diesel
fuel produced via the pathway to be as low as $2.11/gal. FP and
hydroprocessing was the only one of the three pathways to attain
a MFSP for an nth plant below $4/gal gasoline-equivalent (gge) [9].
FP is a thermochemical pathway that uses heat to rapidly
decompose lignocellulosic biomass into solid (char), gas (noncondensable gas, or NCG) and liquid (bio-oil). Char has potential
value as both a cropland soil amendment [10] and carbon sequestration
464
The objective of this paper is to quantify the economic feasibility of gasoline and diesel fuel production from stover via FP and
hydroprocessing using updated information that has become available as a result of the successful construction of the KiOR Columbus facility. KiOR data on equipment requirements and facility
capital costs that are similar for both FP and CFP are incorporated
into this analysis. A 2000 MTPD FP and hydroprocessing facility is
modeled, and the total project investment (TPI) and operating
costs are estimated to determine a MFSP for the gasoline and diesel
fuel under a 10% internal rate of return (IRR). The results of this
analysis are compared to the results of the 2010 ISU study, and a
sensitivity analysis is employed to identify the impact of the updated assumptions on facility MFSP.
1
While the 2010 ISU study reports the use of $1.50/kg for the hydrogen price, the
tables in Appendix D of the companion NREL study indicate that a value of $1.33/kg
was actually used in the analysis [27].
465
Purchased Hydrogen
Gasoline
Hydroprocessing
Upgraded
Bio Oil
Condensor
Storage
Tanks
Refining
Diesel
Plant
Cooling
Cyclone
Off Gas
Compressor
Cooling
Tower
Recycled
Water
Moisture
Recycled
Hydrogen
Pyrolyzer
Pressure Swing
Adsorption
Cooling
Water
Biomass
Char
Chopper
Dryer
Flue Gas
Grinder
Fluidizing
Gas
Off Gas
Non-condensable
Gases
Pyrolysis
Heat
Waste heat
boiler
Steam
Excess
Heat
Flue Gas
Combustor
Turbine
Electricity
Air
Air
Feed
Water
Plant Steam
Table 1
Product yields from FP of corn stover. Source:
2010 ISU study [8].
Table 3
Composition of bio-oil and NCG. Source: 2010 ISU study [8].
Composition (g/100 g dry biomass)
Product yields
FP (wt%)
Bio-oil
Char
NCG
63
17
20
Table 2
Properties of corn stover feedstock. Source: 2010 ISU study [8].
Element
Ultimate analysis (dry basis)
Ash
Carbon
Hydrogen
Nitrogen
Sulfur
Oxygen
6.0
47.3
5.1
0.8
0.2
40.6
Moisture
Fixed content
Volatile matter
Ash
25.0
17.7
52.8
4.5
Non-condensable gases
Carbon dioxide
Carbon monoxide
Ethane
Hydrogen
Propane
Bio-oil compoundsa
Acetic acid
Benzene
Ethylphenol
Formic acid
Furfural
Methoxyphenol
Phenol
Propionic acid
Propyl-benzoate
Toluene
5.4
6.6
0.1
0.6
0.2
5.9
0.8
3.8
3.4
19.0
0.6
0.5
7.3
16.4
2.3
Other compounds
Char/Ash
Water
16.4
10.8
a
Bio-oil compound values in the 2010 ISU study were adjusted to achieve mole
balance.
evenly between equity and debt. This incurs tax-deductible interest payments over the 10-year life of the debt. As a new technological pathway it is unlikely that investors would consider a debt
offering by a FP and hydroprocessing company to be investmentgrade, necessitating a higher interest rate on the debt to account
for this additional risk. This analysis therefore assumes that the
cost of debt is the same as the High Yield Constrained bond index
yield of 7.5% [30]. This factor is sensitive to the assumption that the
facility is located within the United States; an identical facility
located in Europe would pay an interest rate closer to 10% due to
466
Table 4
Methodology for nth plant capital cost estimation. Source: Peters and Timmerhaus
[29].
Parameter
Assumption
100%
39%
26%
10%
31%
29%
12%
55%
TPEC installation factor (3.02)
0.89 TPEC
32%
34%
23%
TIC + IC
20% of TDIC
TDIC + contingency
15% of FCI
6% of TPEC
FCI + WC + Land
Table 5
Comparison of TEA assumptions. Source: Wright et al. [8] and WSJ [30].
Assumptions
Present analysis
2000
58.2
100
N/A
200
Merchant
1.33
0.054
10
83
2000
57.4
50
7.5%
429
Merchant
1.33
0.054
10
83
467
Fig. 2. Installed equipment costs for the present analysis and the 2010 ISU study
(indirect costs, working capital, and land costs are excluded) [8].
Fig. 3. Annual operating costs for the present analysis and the 2010 ISU study
(capital depreciation, average income tax, and annual return on investment are
excluded) [8].
Table 6
Comparison of transportation fuel MFSPs with a 10% IRR. Source: 2010 ISU study [8].
Analysis
Present analysis
2.11
2.57
468
Fig. 4. Sensitivity analysis for 2000 MTPD FP and hydroprocessing facility. To reach the baseline transportation fuel MFSP of $2.57, a 10% facility IRR is assumed.
generating a MFSP of $3.32/gal. The cost of debt and price of electricity have relatively little impact on product MFSP by comparison, although they are not inconsequential.
The results of this sensitivity analysis demonstrate the importance of the assumptions on the economic feasibility of a 2000
MTPD FP and hydroprocessing system. MFSP is highly sensitive
to bio-oil yield, and a reduction from 63 to 49 wt% on a feedstock
basis changes the result from a competitive facility at current
petroleum prices to a loss maker. While facility economic feasibility is not as sensitive to variables such as TPI and the price of electricity, they still have an impact. Raising TPI from $429 million to
$463 million increases MFSP by 4%. The offsetting effect of electricity revenues on the increased equipment costs incurred by the
large boiler and turbogenerator system is illustrated by the 9% decrease to MFSP that occurs when the electricity price is assumed to
be zero. Similarly, failing to account for the sale of excess electricity generated by the boiler and turbogenerator system increases
MFSP by 9%. Alternatively, forgoing electric power generation at
the facility reduces TPI to $288 million and MFSP falls by 9%.
is 22% higher than the MFSP calculated in the 2010 ISU study
($2.11/gal).
The results of the present analysis indicate that the FP and
hydroprocessing pathway might not be quite as competitive with
petroleum-based transportation fuels as originally suggested by
the 2010 ISU study. While the calculated increase to facility MFSP
is not especially large, the increase to facility TPI is and could pose
a challenge to pathway commercialization in an economic scenario
in which capital nancing is difcult to obtain. While much of the
increase to TPI is offset by electricity revenues resulting from the
inclusion of a large boiler and turbogenerator system, the cost increases attributed to the inclusion of a rening unit, a higher estimated hydroprocessor cost, and equipment cost ination are not
offset and act to increase facility MFSP. Further research is needed
to determine whether the large boiler and turbogenerator system
is necessary from a lifecycle analysis perspective to achieve the
GHG reduction threshold required by the revised Renewable Fuel
Standard (RFS2), as the systems high capital cost could hinder
the acquisition of capital nancing for the facility.
6. Conclusion
Acknowledgments
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