Biomass availability and sector competition

The present version of the report is a draft sent out for review by selected stakeholders. Subject to exposing our findings to review comments during a webinar June 2nd 2022, the report will be prepared as a final version.

The aims of this project have been to:

- Provide an overview of recent scientific consensus on future potentials of biomass that are estimated to be sustainably available for non-food/feed purposes, i.e. as feedstock for energy, fuels and materials/chemicals

- Provide an overview of potential demands for carbon-based fuels and feedstock from all key sectors and some insight into the green transition strategies pursued by the sectors

- Get some understanding of the proportions between potential biomass supply and demand in order to understand future competition for biomass feedstock

- Provide an understanding of alternatives to bioenergy, i.e. electrification, hydrogen, ammonia, and electrofuels made from CO2 and hydrogen, and if possible provide an understanding of price/cost developments of biofuels and electrofuels.

These project aims are quite wide and comprehensive and given the limited time scope of the project, it shall be considered as a ‘first step’ or pre-project that can potentially be followed up by a deeper dive into the topics subsequently.

Project procedure

The project was confined to readily available information from literature and key stakeholders. First a brief literature survey was done on biomass availability. Second, existing review of energy system design studies was used to understand demands for carbon-based substances in the energy system, using the Danish energy system as a case in order to understand the details of the system design options. This was in turn supplemented by estimated demands for carbon-containing substances from the materials and chemicals sectors including also the building sector. Third, literature data on price/cost predictions and projections for biomass, biofuels, hydrogen and electrofuels was collected in order to understand and compare their mutual cost-efficiency now and in the near to medium term future.

Finally, key stakeholders from the materials and energy sectors were invited for interviews in order to understand the present thoughts on transition strategies in the various sectors. The interviews comprised stakeholders from:

- Plastic industry: LEGO, BASF

- Cement industry: Aalborg Portland

- Building sector: Danish Architects - Industry in general: Danish Industry (Branch Organization)

- Energy systems and infrastructure: Energinet (the Danish TSO)

- Aviation sector: Airbus, Markit, NISA

- Shipping: Maersk and the Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping

Global biomass potentials

In 2005, with a global population of less than 7 billion people [1], the so-called Human Appropriation of Net Primary Production (HANPP) was around 220 EJ per year [2], i.e. the total net biomass harvest due to human activities. Of this harvest, 35—55 EJ per year were used to provide energy services [3], 20—30 EJ/year for roundwood, paper, and cardboard production [4], and the remainder being used mainly for food and animal feed. In 2019, the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem services (IPBES), released their Global Assessment Report on Biodiversity and Ecosystem Services [5]. According to this expert review, the best estimate of the experts is that a million species are threatened with extinction at the present level of HANPP. Demand for biomass and land is, however, likely to increase further due to global developments; the main drivers for land and biomass demand being the projected development in population and welfare in general as well as the development towards bioenergy and biomaterials in particular.

According to the United Nations [6], the world’s population is projected to reach 9.8 billion people in 2050 and 11.2 billion in 2100. If this population growth comes alongside a significant general increase in welfare per capita and people shift their diets towards more meat, it would result in a dramatic increase in demands for land for animal feed production [7].

Many studies have attempted to estimate the global biomass potential, i.e. how much biomass can be available for bioenergy in the future. In 2010, Haberl et al. reported a range of 160—270 EJ/year of biomass potential sustainably available for bioenergy [8]. A year after, in 2011, a comprehensive review was published by a bioenergy working group under the Intergovernmental Panel on Climate Change, IPCC [2], reporting a consensus among the experts of a bioenergy potential ranging between 100 EJ/y and 300 EJ/y by 2050. In 2013, Haberl et al. published an updated potential of maximum 190 EJ/year [9], and in 2017, the International Energy Agency found a limit of 150 EJ/year of sustainable biomass feedstocks for their scenarios [10]. The more recent studies tend to estimate the potential to be a little lower, and consensus since 2018 seem to center around a biomass potential of 100 EJ/y by 2050 (IPCC 2018, Danish Climate Council 2018, and International Energy Agency 2021). In 2021, the Energy Transition Commission reported an even lower range of 40-60 EJ/y as their best estimate of a sustainably available potential.

The most recent study [27] from the IPCC Working Group III, i.e. their 2022 contribution to the Sixth Assessment Report of the Intergovernmental Panel on Climate Change, states a more nuanced breakdown of the potential as (quote):

”Recent estimates of the technical bioenergy potential, when constrained by food security and environmental considerations, are within the ranges 5—50 and 50—250 EJ yr-1 by 2050 for residues and dedicated biomass production systems, respectively.”

Over time, some researchers have found also higher potentials above 300 EJ/year, but with a low agreement among other experts [11].

Summing up, there seems to be a high agreement among the scientific community that the sustainable technical potential for bioenergy by 2050 is in the region of 100 EJ/year; being equivalent to around 10 GJ/person/year in 2050 if everybody should have their equal share. Table 1 next page shows the above mentioned estimates and how they have developed over time.

An extensive deployment of bioenergy is one scenario for the transition away from fossil fuels in the effort to comply with the Paris agreement [12]. But a look at proportions calls for caution. In 2015, the world’s total primary energy supply was around 570 EJ, of which around 470 EJ were fossil fuels [13]. This was more than a doubling of the world’s total primary energy supply since 1973 [13], and for current policy scenarios, the number is projected to increase to more than 800 EJ by 2040 [25] and around 900 EJ by 2050 [26], equivalent to 90 GJ/person/year. From these numbers, it is evident that biomass alone cannot fully substitute fossil fuels. Other technologies and strategies are needed for fossil fuel substitution to avoid biomass and land constraints being a bottleneck of the green transition.

Energy system transition, electrification and hydrogen integration

Many studies were done on the green energy system transition. A recent study on a global scale is the International Energy Agency’s study ‘Net Zero by 2050. A Roadmap for the Global Energy Sector’ from 2021 [16]. Global studies inherently do not have high spatial nor temporal resolution. In order to understand the details related to ensuring a balanced and resilient system, so-called Energy System Analysis, ESA studies strive to balance systems of e.g. electricity and heat hour-by-hour, thus revealing how e.g. wind and solar power fluctuations are handled partly by flexibility of demand on the one side and flexible supply on the other side partly by energy transmission, trade and storage. Further, many such ESA studies aim to minimize the cost and, thus, find a cost-efficient mix of solutions including electrification of transport and heat sectors and including biofuel pathways as well as electrolysis and electrofuel pathways for transport fuel production.

During the past decade, many such ESAs and energy system design studies were made of the future Danish energy system. Through a recent PhD study at SDU, an overview of these were made [28]. This overview has revealed how electrification and integration of electrolysis and hydrogen can reduce the demand for biomass in the system.

In brief, most of the system can be electrified, including road transport, heat supply and the majority of industry’s demand for thermal energy, and this electrification seems to be cost-competitive even compared to fossil fuels. But around a third of the fuel/feedstock demand of the system, when including plastics and other carbon containing materials/chemicals, cannot be directly electrified.

Studies on the Danish energy system

Mortensen et al. [29] studied a total of 16 energy system scenarios from 8 different studies on the Danish energy system. All of these scenarios comprise fully renewable energy system designs, but with varying design principles and varying system compositions. An overview of the studies and scenarios is given in Table 2 below.

These system design scenarios were scrutinized by Mortensen et al. [29] in order to reveal the implications for biomass demand of a renewable energy system, and the role of electrification and hydrogen in bringing this biomass demand down to a sustainable level. The key lesson learnt from this is shown in Figure 2 and explained in the following section 3.2.

The scrutinized studies shown in Table 2 all had some degree of economic concerns and other nontechnical criteria underlying the system designs. As a supplement to the scenarios from these studies, Mortensen et al. [29] created a total of 9 purely technical system designs, the purpose of which was to show how system biomass demand can be lowered by gradually advancing the systems with increasing degree of system integration, electrification, electrolysis and CO2 capture from both flue gases and the atmosphere. With these 9 system designs, the aim was to show how each of technically logical, discrete system advancements would lower the biomass demand, see section 3.2.

Hydrogen demand at sustainable biomass use

In Figure 1, the stepwise gradual advancement of the technical system design is shown from Design Scenario 1 (DS1) to Design Scenario 9 (DS9). All systems satisfy the same energy end-services of electricity, thermal energy and transport. Including, of course, all the various sub-categories of these, thermal energy e.g. comprises individual domestic heating, district heating (which in Denmark comprise 60 % of all domestic heating) and industrial thermal energy demand, and transport comprises all kinds of road transport, shipping and aviation. All energy demands and supplies are expressed per capita per year. As shown, end-services of energy add up to the aggregated numbers of 20 GJ/capita/year of electricity, 40 GJ/capita/year of thermal energy and 15 GJ/capita/year of mechanical energy for transport, i.e. the propulsion energy from to motor after the fuel conversion or electricity conversion in order to have a common denominator independent on the means of propulsion. Only DS1 has higher end-service, because this represents a scenario, in which significant energy saving can still be achieved, whereas DS2-DS9 represent scenarios, in which these energy savings are already implemented.

DS1 is representing a poorly integrated and inefficient system with significant options for energy savings. In DS2, such savings were implemented, including modal shift of transport especially towards more freight transport on rail. In DS1 and DS2, there is still no sector integration, i.e. no co-generation of heat and power (CHP) and no district heating grids. In DS3, district heating and CHP are implemented to the present degree of the Danish system, i.e. around 60 % of all domestic heating supplied as district heating. In DS4, wind and solar power are implemented to the extent allowed without curtailing peak power production and without significant export, i.e. to the extent where the renewable electricity supply can be consumed within the Danish system. DS5 shows, then, the effect of deep electrification, where almost all person transport on road and most of thermal energy are electrified through battery electric vehicles and heat pumps in both individual heating and district heating, as well as in 75 % of industry’s thermal energy demand. In DS6, electrolysis is implemented for hydrogen production to the extent that allows all carbon in the used biomass to be upgraded with hydrogen to achieve highest energy content per biocarbon input. This is achieved through methanation of the CO2 in biogas and through hydrogenation of syngas from biomass gasification. In DS7, also point source CO2 is captured and hydrogenated with hydrogen from further electrolysis. In DS8, biomass is limited to manure and other agricultural residues going into biogas, and the biomass input is kept at 10 GJ/capita/year in order to comply with this threshold, which in turn implies the need to capture CO2 also directly from the atmosphere in order to have carbon enough for the demandside, leading consequently to even more electrolysis and hydrogen production. Finally, DS9 represents a scenario completely free of biomass use, in which all carbon derive from direct air capture, DAC.

As evident from Figure 1, the stepwise advancement of the system design allows for more and more wind and solar power integration and for less and less biomass use — going from a biomass demand of 215 GJ/capita/year in the least carbon-efficient scenario (DS1), over 60 GJ/capita/year in the fully electrified scenario (DS5) without any hydrogen to 10 GJ/capita/year and even 0 GJ/capita/year with increasing scale of hydrogen production and carbon capture (DS8 and DS9). Figure 2 below aims to capture this dependency of biomass demand on system electrification and hydrogen integration.

As Figure 2 shows, all the 8 Danish studies include one scenario with a maximum biomass use of 40 GJ/cap/y, because this is found to be the volume of residual biomass from Danish agriculture and forestry that can be sustainably used in Denmark. The reason that it is four times higher than global average is mainly that Denmark has a much higher than average agricultural production of 3-5 times the Danish food consumption. However, a system that on the demand side depends on this scale of biomass input is, of course, not scalable, and, thus, not a model of a global system solution. Therefore, in the technical system design solutions, Mortensen et al. [29] wished to include systems with a biomass dependency of 10 GJ/cap/y or less.

Lessons to be taken from the presentation in Figure 2 are:

- Without any electrification or hydrogen, a fully renewable Danish energy system would need a biomass input of above 100 GJ/cap/y — even at the very high sector integration of heat and electricity that prevails in Denmark

- With a very deep electrification of heat, transport and industry thermal energy demand, the system will still demand 60 GJ/cap/y of biomass

- Integrating electrolysis and hydrogen as well as carbon capture from flue gases and the atmosphere in fuel production can bring the biomass demand down to a sustainable level.

- In order to reach a biomass demand of maximum 10 GJ/cap/y, the Danish energy system will need at least 17 GJ/cap/y of hydrogen

- In Figure 2, the area shaded green represents the sustainable solution space for a renewable energy system design of a system like the Danish, respecting concerns for both climate and biodiversity

Interestingly, the above lessons learned of the need for hydrogen and electrofuels represents the energy system alone, and do not include feedstock for materials such as plastic, building materials etc. nor chemicals such as solvents, paints, etc. The demands for carbon-containing feedstock from these sectors are of the same scale as the energy system demands (see below), and they also express strategies for using sources of biomass or bio-CO2 as feedstock.

The purpose of showing this overview, comparing demands for carbon-based fuels with demands for carbon-based feedstock, is to visualize that the need for biomass and/or CO2 as the source of carbon input 9 Classification: Public is twice the one of the deeply electrified energy system alone, when including feedstock for materials and chemicals in a society like the Danish. Satisfying feedstock demand for the material and chemical sectors as well would, thus, demand around twice the hydrogen demand of the energy system alone, i.e. above 30 GJ/cap/y of hydrogen. Moreover, the sustainably available biomass of 10 GJ/cap/y would only provide 25 % of the total carbon needs for all sectors in society, the rest would have to come from CO2, either from flue gases (implying a capture and second use of the bio-C) or from the atmosphere directly. Realizing that CO2 from flue gases in the future deeply electrified system is quite limited, the vast majority of this CO2 will have to come from direct air capture, DAC.

Finally, one further significant demand for carbon exists, i.e. carbon storage, as we need global negative emissions at some point. This can to some extent be achieved by afforestation, by using bio-C or DAC for making plastic, or by using wood in buildings, but strategies for storing carbon as CO2 in the underground are also expressed by several countries, implying that CCS becomes a carbon customer on the demand side. Up to the scale of using the CO2 from biomass used in heat and electricity, this does not involve extra carbon demand, but as seen from the list above, this is only a minor share of the biomass/carbon demand. Any CCS above this scale or soil sequestration of carbon, like e.g. using biochar, will come as an extra demand.

Extrapolation to the global system

A point can be raised that the overview presented here is valid for the Danish energy and materials system, and it may be questioned, if the lessons learned are valid for the global average. The benefit of looking at the Danish system with the high spatial and temporal resolution (hour-by-hour match of supply and demand), it implies, is that the details of the demands caused by the system dynamics, system balancing and system integration are revealed. Of course, the Danish energy demand per capita is higher than the global average, and of course, the Danish housing sector demands much heat, where other countries demand cooling. However, carbon demands in heating and cooling are very small in this system, the majority of demands stem from heavy transport and materials/chemicals. Therefore, the lesson learned that around two thirds of the system can be electrified, whereas one third of the system still needs fuels and carbon-based feedstock, is probably quite valid as a global average.

Another point can be that the perspective used here is to design a fully renewable energy system with zero use of fossil fuels. Some studies, like IEA’s ’Net Zero by 2050’-study [16] assumes some degree of fossil fuels use, which in turn is counteracted to net zero by carbon storage and soil sequestration. This will, probably, imply some difference, but on the other side, the more fossil fuel input to the system, the more carbon is needed to go into soil or the underground, so on a net basis, it may not change the picture that much.

Cost breakeven between biofuels and electrofuels?

When deciding on a strategy for future feedstock supply, each sector, thus, has to consider whether to go for biomass or CO2 as carbon feedstock — in those cases where direct electrification, hydrogen or ammonia are not feasible. As part of this consideration, cost-efficiency is an obvious concern.

Today, electrolysis/hydrogen is expensive and so is carbon capture. But the focus on both technologies is huge, much innovation is going on and many projects started. The world is on a steep learning curve and the benefit of economy of scale is ahead of us. Last year (2021), Bloomberg published a forecast of development in hydrogen production costs, and towards 2050, the cost is believed to be reduced by two thirds at least, going from around 25 EUR/GJ today (under Danish conditions) to around 7 EUR/GJ in 2050, see Figure 3.

The opposite is believed to be the case for biomass prices. Wood chips are traded on an international/ global market, and biomass supply is constrained. It implies that increasing demand/supply only comes at increasing production costs. Today, market prices for wood chips lie around 6 EUR/GJ ab forest [31] at the present scale of demand of around 60 EJ/y, whereas in a future with increasing demand as well as concerns for compliance with UN sustainable development goals, a demand/supply at a scale of 170 EJ/y will come at a price of 25 USD/GJ or just above 20 EUR/GJ [32]. At some point, therefore the cost of hydrogen seems to potentially become smaller than the cost of biomass per unit of energy, and accordingly, so can the cost of electrofuels compared to biofuels.

In Figure 3, an attempt is made to forecast the development of the production cost of biofuels and electrofuels.

As can be seen from Figure 3, and assuming that Bloomberg’s forecast of hydrogen production costs holds true, sometime soon, the cost of electrofuels has the potential to become lower than the cost of biofuels. As space requirements for solar power and wind power are very small compared to biomass (per unit of energy) and as the water for hydrogen production is abundant, this is a promising acknowledgement. A key question is, thus, if we can believe the prediction indicated by Figure 3 above, especially with respect to technology development of electrolysis. The Figure is made here based on quite rough assumptions and needs further elaboration. Another question is at what speed, infrastructure developments and investments in solar and wind power and electrolysis will take place, and finally, who will get hold of CO2?

Point source CO2 will become limited soon, and probably more than half of the needed CO2 must come from direct air capture according to our judgement from studying the Danish system. The key stakeholders in DAC predict that by 2040 the cost of DAC will get as low as 100 EUR/ton, and in this case e.g. e-methanol from DAC will not lie much higher than the green dotted line in Figure 3 above, and presumed to be well below 20 EUR/GJ.

Sector demands for carbon-based fuel and feedstock

Based on knowledge on the global scale of demand for the various sectors and some of it roughly extrapolated from our Danish experience, an attempt was made to estimate low and high global sector demands for carbon-based fuels and feedstock, see Table 3 next page.

Bearing in mind that the World Energy Council forecast of total world energy demand by 2050 is 900 EJ/y in a business-as-usual scenario [26], it is evident from Table 3 that both the low and the high estimate for carbon-based fuel & feedstock demand require a high degree of electrification. With these estimates, therefore, global demands seem to exceed biomass availability by a factor 2-4 — or even more, because the demand here are end demands of fuel and feedstock, whereas biomass availability represents biomass inputs before any conversion.

Parts of these feedstocks can, of course still be fossil fuels, e.g. for plastics. But as mentioned earlier, the more fossil feedstock is used, the higher the net demand for carbon storage becomes though Bioenergy with Carbon Capture and Storage (BECCS) or soil sequestration through e.g. biochar. Moreover, based on our interviews with key sector stakeholders (see section 5), all sectors seem to have ambitions and strategies of green transition, i.e. using a green carbon source, because who wants to be left behind on the platform when customer preferences exert their influence on the market? In the overview created in this project, we have, thus, used the perspective of a full transition away from fossil fuels and feedstock.

The figures are rough and need further elaboration, but there is little doubt that competition for biomass and also for bio-CO2 from flue gases and from biogas becomes strong. Whoever can aim for DAC on the medium to long term seem to be on the safe side.

The general questions for each sector to address are:

- what is the cost increase of non-fossil, non-bio, non-carbon solutions and the cost differences between them?

- what are customer perceptions and the willingness to pay & ability to pay in each sector and why?

- what is the road map and likeliness of conversion in each sector — to which alternatives at which time?

Sector stakeholder interviews

The minutes from the conducted stakeholder interviews are held brief and at the level of bullet points.

Plastic industry

LEGO

Søren Kristiansen, Sr. Technology Director, Materials:

- LEGO has two goals in parallel: Both decarbonize and increase resource circularity

- LEGO is in frequent dialogue with world leading plastic producers like Dow

- Dow and Shell work on electrification of crackers and claim that 75 % of cracking energy can be electrified

- Strategy is developing fast: five years ago mainly bio-materials, now many pathways q LEGO pursues all pathways today:

• Bioplastic (bio-ethylene)
• Recycled plastic — special focus on PET
• Chemical recovery (pyrolysis)
• E-plastic (to a lesser extent at the moment)

- E-plastic believed to be a viable option, if there is enough space/locations for wind and solar. On the short term, main focus is on bio, recycling and pyrolysis.

- But tendency is to not lean too much on bio-plastic.

- Pyrolysis has high conversion loss and other more direct chemical recycling routes would be preferable.

BASF

Rene Backes, scout for renewable raw materials, chemist (identify projects)

Andreas Bode, engineer, carbon management R&D program, mid to long term programs

Wolfgang Huebinger, chemist, engineer (raw materials input, 10 year forecast)

Yvonne Heischkel, chemist global procurement, value chain analyst, GHG emissions

• Henrik: Ellen McArthur Foundation predicts plastic production to increase from 0.32 Gt/y in 2016 to 1.2 Gt/y by 2050, i.e. almost a quadrupling. 15 Classification: Public
• Wolfgang: BASF believes lower, i.e. like a 2- to 3-fold increase instead. Ellen McArthur exaggerates, the 1.2 Gt/y more like the whole carbon-based material/chemical sector
• Henrik: Seen in this growth perspective => plastic in techno-sphere can be a huge carbon sink if based on e-naphta. This could potentially turn the substance and image of plastic industry to being the most climate friendly material in the world. Andreas Bode finds this to be an interesting perspective.
• Wolfgang: plastic/other carbon-based chemicals 50/50 in volume. Other chemicals (like solvents) are non-recyclable => carbon emitted
• Wolfgang: Road transport can be electrified even big trucks. Daimler on the way with this.

Strategy:

• Rene: BASF looks strongly into recycling, incl. chemical recycling
• Don’t see e-plastic to come before high electrification is done in other sectors
• Wolfgang: Strategy most probably towards Bio-C in the coming 10-20 years. In the long run maybe 10 % of polymers will come from bio
• Wolfgang: believes CCS will be implemented on all flue gas emissions

Cement industry

Ã…lborg Portland

Kent Rønning Andersen, responsible for fuels (from US to Asia) including waste sources

Jesper Sand Damtoft, Sustainability and R&D

• Ã…lborg Portland (AP) owned be Cementir Group, 11 cement plants around the world
• AP looks a lot into CCS now
• Around 2/3 of CO2 emissions come from calcination, the rest from energy
• Electrification difficult due to the need for a flame to transfer the energy to the material. Could be possible for the drying & calcination, but would require new kilns
• Priority fuels are waste-derived, i.e. containing plastic, paper, wood
• Worldwide production is 5 billion tons grey cement/y ≈ 20 EJ/y today. White cement is very small, i.e. 20 Mt/y ≈ 0.14 EJ/y
• World demand still growing, with the fastest growth in developing countries, but expected to flatten out with increasing development
• Landfill mining of waste for waste-based fuel production could be an option for cement industry 16 Classification: Public
• Concrete re-absorbs part of CO2 from calcination during its lifetime. This process can be enhanced during production of aggregates from demolition
• Henrik: landfill mining + CCS + using concrete-aggregates from demolition => a very large negative carbon footprint of cement/concrete and has the potential to turn cement/concrete from being the climate bad guy to the savior in the building sector

Danish Industry

Troels Ranis, Danish Industry, Director DI Energy

• Troels: From DI Climate Partnership report: Danish Industry needs 17 PJ/y of bio-methane by 2030
• Troels: Demand for carbon-based fuels caused by be need for flame or for very high temperature/very large scale
• Troels: Today, the whole industry demands ca. 100 PJ, just energy: 25 is used by plastic, cement, glass industry, 25 PJ used by food industry, 15-18 PJ used by refineries (not final consumers), 5 PJ chemical industry, 12 PJ by metal industry, 15 PJ Other
• Henrik: According to Energinet and a Rambøll report, 75 % of industry’s fuel demand today can be electrified. Fuel demand is around 75 PJ/y, i.e. around 18 PJ is needed as fuel. Troels is aware of this report and estimates and confirms.
• Troels: Overall strategy is to electrify wherever it is possible. A study is ongoing looking at electrification in the food industry.
• Troels some companies install dual boilers allowing to switch to electricity at low electricity prices
• Sugar industry (Nordic Sugar) aims for biogas in the near-term future

Energy systems and infrastructure

Energinet

Anders Bavnhøj Hansen (ABH), Chief Engineer, systems perspective

Anders Winther Renuit-Mortensen (AWM), PhD electrofuels

• ABH: EA Energianalyse seems to expect stable biomass prices even with increasing demand (but not mentioned how large increase)
• ABH: 1.5 EUR/kg H2 could lead to break-even with biofuel prices 17 Classification: Public
• Carbon-based fuels not really needed for road transport — even the heaviest transport can be electrified
• ABH: With regards to industry — refer to Wiegand-Maagøe report
• AWM: DAC is CAPEX intensive, Technology catalogue says levelized cost of 190 €/ton by 2025 and 115-120 €/ton by 2050. But if excess heat available from e.g. waste incineration or other CHP, then 100 €/ton by 2030 and 80 €/ton by 2050. Compression adds 10 €/ton. Other sources expect even lower costs.
• ABH: H2 cost in DK today = 3-5 €/kg, expected to be 1.25-1.5 €/kg in DK by 2050
• Final methanol price could be around 450-550 €/ton

Building sector

Building sector

Peter Andreas Sattrup, Danish Architects

• Peter Andreas Sattrup, Danish Architects q Peter finds our aim to understand building sector strategy good, but no clear answer. The sector is very fragmented.
• A good contact is also Harpa Birgirsdottir at Ã…lborg University
• In greening strategies for buildings, there is a tendency towards substituting concrete with wood. Foundation will probably always be concrete
• Henrik: Total roundwood production today is 25 EJ/y. Believed to reach 40 EJ/y by 2050 due to the below:
• Henrik: two drivers for increased use of wood in buildings:

1. Transition towards wood in construction (replace concrete)
2. General growth in population and living standards, i.e. more living space/capita => more wooden floors, ceilings, kitchens, furniture, … This driver is believed to be the strongest

Aviation sector

Markit

Daniel Evans, Louise Vertz, Madison Barefoot, Stephen Li

• Markit themselves look at trends in various sector’s transition strategies — including decarbonization of aviation and shipping
• Daniel: biofuels mainly for aviation. No major cost reduction trend seen for biofuels. Biofuels believed to become more costly whereas cost of other alternatives is believed to decrease over time
• Stephen: the coming pathways for aviation: Alcohol-to-jet and biomass gasification + Fischer[1]Tropsch. US aviation sector acts on ethanol-to-jet at present
• Daniel: Hydrogen in aviation — we are skeptical, takes too long to roll out, not realistic before 2050
• Daniel: Fuel demand projection: 9 M barrels/d in 2050 (= 20 EJ/y), 15 % of this as SAF, the rest fossil. Only few airlines care about SAF today
• Louise: when shift to e-fuels? — by 2035, e-fuels are believed to be on the market

NISA

Martin Porsgaard, Director

• Nordic countries have relative high CO2 reduction ambitions
• Denmark aims for 30 % reduction by 2030
• Danish aviation looks into e-fuels, but use of green hydrogen in refineries and biofuels are also in the game
• Aviation in general look at several pathways — electrification of very short distances and small aircrafts, hydrogen for medium and hydrocarbons for long distances

Airbus

Mark Galle, Steven Le Moing

• Electric aviation only very short distances
• Hydrogen has physical limits, cannot go into the wings and therefore takes up large space. ATAG view: beyond 2500 km, hydrogen not feasible
• >50 % of aviation fuel demand comes from flights > 2500 km. So > 50 % fuels must be kerosene type, either bio-kerosene or e-kerosene
• Biofuels are seen as an intermediate in order to bridge a time gap towards e-fuels 19 Classification: Public
• Existing aircraft fleet must use kerosene — no way of changing fuel type. But 50 % SAF can today be blended into fossil fuel of existing fleet
• ATAG ‘Waypoint 2050’ scenario study show transition scenarios
• When full fleet is exchanged after fleet lifetime, then > 50 % will still run on kerosene => maybe max 25 % transitioned by 2050?
• Fuel demand by 2050 expected to be 500 Mt/y = 21 EJ/y

Shipping sector

Maersk

Maria Strandesen, Maersk Decarbonisation

• After 2,5 years of evaluating new fuel options, Maersk has landed on green methanol (both bio/e methanol) as their favorite fuel — due to it having the best overall feasibility profile (non-toxic, easy to handle, engine available, multiple production pathways incl. e/bio, and usable in fuel cells)
• Efforts still ongoing to identify potential drop-in fuels for existing fleet — currently pyrolysis/HTL oils are of interest due to the relatively low cost and it being the ‘dirty oil’ that other sectors might not want to use.
• Ammonia still on the ‘perhaps-list’ — main concerns being safety. Expected to be the cheapest e[1]fuel option in the future, however, due to handling issues there may be a willingness to pay ‘a bit more’ for e-methanol, just to avoid having to handle ammonia.
• Hydrogen being investigated as a potential fuel for smaller vessels with a roundtrip of maximum 2000 km. Not an option for deep sea going vessels.
• Continuous evaluation of how the split between e-fuels and biofuels should be going forward
• 13 new vessels (one 2.000 TEU feeder and twelve 16.000 TEU vessels) ordered — all designed to run on green methanol. Will be put in the water in 2023/2024 and onwards. Green methanol (e[1]methanol) secured for the feeder, negotiations on bio/e-methanol ongoing for the 12 vessels.
• All newbuildings (new ships) from now on (owned by Maersk) will be designed to run on carbon neutral fuels

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