Bioeconomy Coaltion of Minnesota overview
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Bioeconomy Coaltion of Minnesota overview



A summary of the Bioeconomy Coalition of Minnesota, presented by the Great Plains Institute

A summary of the Bioeconomy Coalition of Minnesota, presented by the Great Plains Institute



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  • 95 percent of products coming from petroleum can be made from biobased alternatives (LUX RESEARCH)
  • Even so, there is a substantial reduction in energy savings. Again here we see that one can provide twice as much product for the same amount of energy.
  • 30K MT capacity = GHG Savings 211,700Tonne CO2e per/yearThe CO2 emissions of Petro Succinic is 213,000 tonnes Co2/yearThe co2 emission of Bio Succinic is 1,300 tonnes Co2e/yearThat is a savings of 211,700 tonnes of Co2e per yearElectricity Reductions (kilowatt-hours) The Greenhouse Gas Equivalencies Calculator uses the Emissions & Generation Resource Integrated Database (eGRID) U.S. annual non-baseload CO2 output emission rate to convert reductions of kilowatt-hours into avoided units of carbon dioxide emissions. All C02 equivalency metrics calculated from the Environmental Protection Agency equivalency calculator
  • 1.6 Trillion Btu per year according to our LCAThis is the savings, NOT the USE for BIO-SA production. That means this is the difference between the energy our process uses and the energy of Petro derived SA.

Bioeconomy Coaltion of Minnesota overview Presentation Transcript

  • 1. Bioeconomy Coalition of Minnesota: 2014 Legislative Priorities
  • 2. Mission of the Bioeconomy Coalition of Minnesota Articulate and implement a Minnesota state policy and regulatory agenda to expand biobased chemical, advanced biofuel, and biomass thermal energy industries, along the entire value chain from R&D through commercial production and use.
  • 3. Coalition Organizers
  • 4. Coalition Partners
  • 5.
  • 6. Displacing the WHOLE Barrel of Oil Other Products US Department of Energy 2005 Slide courtesy of 6 BioIndustrial Partnership
  • 7. Renewable Chemical Value Slide courtesy of BioAmber
  • 8. Large forestry biomass resource and large (but declining) forest products industry Large agricultural biomass resource, and successful track record in creating an ethanol industry through effective state policy
  • 9. Minnesota’s Biobased Chemicals Cluster XL Terra Segetis Reluceo Lonza Cortec Butrolix Entropy Solutions EarthClean Cargill Industrial Oils West Central Ammonia Development BioAmber Natur-tec Natureworks Agristrand Biocomposites Butamax Gevo Cargill BioH Starch Tech CHS Slide courtesy of 9 BioIndustrial Partnership
  • 10. Renewable Materials Value Chain Next Generation Biorefinery Farmers/Foresters Formulator/ Refinery End Product Manufacturing Retail, End Uses 10
  • 11. Company Highlight: • Headquarters: Golden Valley, MN • Base bio-derived compound: Levulinic ketals • Used to replace petroleum in the manufacture of: – Plasticizers (PVC), polyols for polyurethane materials or use in polyester thermosets or thermoplastics and cleaning solvents
  • 12. Greenhouse Gas Reductions from Biofuels According to existing federal policy (EPA’s RFS2) 100% 20% 90% Reduction 80% 50% 70% Reduction 60% Reduction 60% 50% 80% 40% GHG Intensity 30% 50% GHG Intensity 20% 10% 40% GHG Intensity 0% Gasoline Corn Ethanol Advanced Biofuel Cellulosic Biofuel Compared to gasoline: Corn Ethanol 20% GHG Reduction Advanced Biofuel 50% GHG Reduction Cellulosic Biofuel 60% GHG Reduction e.g. bio-butanol e.g. ethanol from corn stover or wood Source: EPA RFS2 Threshold Levels; graph and slide by GPI
  • 13. Iowa
  • 14. Company Highlight: • Headquarters: Elk River, MN • Produce syngas from biomass • Use syngas coupled with commercial thermochemical processing technology to produce gasoline, diesel fuel and chemical products – integrated biorefinery
  • 15. 2013 Legislative Achievements • Biobased Chemical Funding: – Language added to NextGen Energy Board Statute allowing investment in biobased chemicals – ~$2.5 million over 2 years – Planned RFP for Fall 2013 • Next Gen Biofuels: – Modifying MN “ethanol” mandate to be biofuelneutral, allowing butanol and other biofuels to enter market. – Establishes 30% by 2025 biofuel goal – Taskforce to recommend incentives to commercialize advanced and cellulosic biofuels in MN
  • 16. 2014 Policy Priorities
  • 17. Success of MN’s 1st Generation Plants 18
  • 18. Policy 1: Producer Incentive • Summary: Provide production-based incentives for production of biobased chemicals, advanced biofuels, and biomass thermal energy.
  • 19. Policy 1: Producer Incentive • Why do this? – Make Minnesota a world-class destination for building commercial-scale advanced biofuel and biobased chemical plants – Production incentive can be included in financing, and will attract projects to Minnesota. – Legitimate government role in helping to build “first-of-a-kind” facilities, for which other forms of financing do not exist. – Protection for the state. No payment occurs until production occurs. No risk of boondoggle projects. – State government doesn’t pick technology winners. They simply award the projects that cross the finish line. – Minnesota has history with this approach, through the state’s ethanol producer payment.
  • 20. Policy 1: Producer Incentive • Eligibility and Incentive levels – Biobased Chemicals • $0.03/Ib • Up to $60,000,000 over 10 years – Advanced Biofuels • $0.10/gal • Up to $30,000,000 over 10 years – Cellulosic Biofuels and Cellulosic Diesel • $0.20/gal • Up to $60,000,000 over 10 years – Certain Biomass Thermal projects • $10/mmbtu • Up to $2,000,000 over 10 years • Additional sustainability bonus for use of certified feedstocks, or for following state-approved best management practices
  • 21. Policy 1: Producer Incentive • Qualified Facilities – Must source raw materials (sugar, biomass) from Minnesota – Raw material must be from agricultural or forestry sources, or from organic content of municipal solid waste. – Facility must be located in Minnesota – Facility must begin operation after January 1, 2015 (including existing facilities with significant retrofits to allow new production after January 1, 2015)
  • 22. Policy 2: Public/Private Equity Investments • Summary: Create a new state-funded public/private investment pool to make equity investments in Minnesota-based biobased chemical and advanced biofuel companies to support growth and innovation, and help companies cross the “valley of death” to commercialization.
  • 23. Policy 2: Public/Private Equity Investments • Why do this? – Already permitted under state statute governing the Environment and Natural Resources Trust fund – Secure MN’s leadership in a potentially $500 billion industry – Support innovative MN start-up companies, in a sector where MN is currently the world leader – Assure MN companies stay in the state, despite competition from other states; counteract venture fund pressure to move companies to CA and other states where funds are located. – Attract $4 in outside funding for every $1 invested by the state of MN – Significant outside match assures vetting of companies and technologies by outside investors, and protects state investments. – State also manages risk by making multiple investments.
  • 24. Policy 2: Public/Private Equity Investments • Policy detail: – State should aim to make 5-10 total investments of $2-10 million each (total state investment of between $10-100 million). – The state should form a partnership with a qualified lead investor who will take responsibility for attracting other investors, and conducting due diligence and company valuations and negotiating investments. – State should require a 4:1 match for any state investment, represent no more than 20% of total investment in a given company (required by statute). – Favor companies that receive SBIR investment in scoring system, along with other criteria. – Possible source of funding: State Environment and Natural Resources Trust fund, or other state investments managed by the State Board of Investment.
  • 25. Policy 2: Public/Private Equity Investments • Only invest in companies that are: – Headquartered in Minnesota and have the majority of their operations in Minnesota. – Primary operations devoted to developing biobased chemical or advanced biofuel technology. – Evidence of movement towards commercial-scale production. – Investment targeting companies in “pre-commercial” stage to assist moving towards commercial scale. – Invest in companies that have already attracted significant venture capital investment (more than $50 million) (include SBIR as a criteria)
  • 26. Policy 3: Bonding for Community-Scale Biomass Thermal Projects • Summary: Provide bonding funding for capital investments in biomass heating plants and district energy facilities to support that state’s biomass thermal industry while reducing energy bills and environmental impact.
  • 27. Policy 3: Bonding for Community-Scale Biomass Thermal Projects • Biomass heating and district energy are proven technologies that are being operated at scale in Minnesota and around the world. • There are numerous biomass heating projects proposed around the state. • Bonding funding helps communities to finance large, multi-building projects and projects at public facilities that are difficult to finance. • Several studies show strong economics for these facilities.
  • 28. Policy 3: Bonding for Community-Scale Biomass Thermal Projects • A few examples of projects that would immediately benefit from a state bonding bill include: – City of Grand Marais District Heating Project – City of Ely District Heating Project – Itasca Community College – Itasca State Park – Soudan Underground Mine State Park
  • 29. Other policies • Support Department of Biosystems Engineering Bonding Request • State procurement of biobased products • Product stewardship
  • 30. Additional context slides
  • 31. Renewable Materials Value Chain Next Generation Biorefinery Farmers/Foresters Formulator/ Refinery End Product Manufacturing Retail, End Uses Slide courtesy of 32 BioIndustrial Partnership
  • 32. Existing Biorefineries Across Minnesota 33
  • 33. Minnesota – World Leading Cluster of Biochemical Company Headquarters 34
  • 34. Mississippi 35
  • 35. Louisiana 36
  • 36. Energy Use In Production Energy use (MJ /kg) Energy Savings 52% 100 90 80 70 60 50 40 30 20 10 0 88.8 88.7 42.69 BioAmber S * A Petro AA (Thermal) Petro AA (Catalytic) *Field-to-Gate Energy and Greenhouse Gas Emissions Associated with Succinic Acid Produced At BioAmber’s Facility In Sarnia Ontario, August 2012 Slide courtesy of BioAmber
  • 37. Ontario, Canada 30K MT Production of Bio-Succinic Acid Will SAVE 212,000 tonnes of CO2e per year Slide courtesy of BioAmber
  • 38. Sarnia Production of 30,000 MT Bio-Succinic Acid will SAVE 1.6 Trillion Btu of energy per year Slide courtesy of BioAmber
  • 39. Bio-SA: Lower Cost Than Petroleum SA Lower Cash Cost TODAY Historical Data past 29 years when oil > $30/barrel Petroleum Succinic CASH COST Competitive with Oil at $35 / Barrel Bio-Succinic Cost Advantage for BioAmber Cost Advantage for Petroleum @ $80 barrel oil @ $6.00 bushel corn Cost Advantage Will Drive Market Share Growth In This $3.8 Billion Market Opportunity Slide courtesy of BioAmber