Strategic supply system design – a holistic evaluation of operational and production cost for a biorefinery supply chain

Abstract

Pioneer cellulosic biorefi neries across the United States rely on a conventional feedstock supply system based on one-year contracts with local growers, who harvest, locally store, and deliver feedstock in low-density format to the conversion facility. While the conventional system is designed for high biomass yield areas, pilot scale operations have experienced feedstock supply shortages and price volatilities due to reduced harvests and competition from other industries. Regional supply dependency and the inability to actively manage feedstock stability and quality, provide operational risks to the biorefi nery, which translate into higher investment risk. The advanced feedstock supply system based on a network of depots can mitigate many of these risks and enable wider supply system benefi ts. This paper compares the two concepts from a system-level perspective beyond mere logistic costs. It shows that while processing operations at the depot increase feedstock supply costs initially, they enable wider system benefi ts including supply risk reduction (leading to lower interest rates on loans), industry scale-up, conversion yield improvements, and reduced handling equipment and storage costs at the biorefi nery. When translating these benefi ts into cost reductions per liter of gasoline equivalent (LGE), we fi nd that total cost reductions between -$0.46 to -$0.21 per LGE for biochemical and -$0.32 to -$0.12 per LGE for thermochemical conversion pathways are possible. Naturally, these system level benefi ts will differ between individual actors along the feedstock supply chain. Further research is required with respect to depot sizing, location, and ownership structures. Published 2015. This article is a U.S. Government work and is in the public domain in the USA. Biofuels, Bioproducts and Biorefi ning published by Society of Industrial Chemistry and John Wiley & Sons Ltd. Supporting information may be found in the online version of this article.Keywords: biorefi nery; feedstock logistics; depot; bioeconomy; biofuel; advanced feedstock supply system 3 Targets are generally iterated between advancements in feedstock logistics and the development of more robust conversion systems. But it remains unclear if a conventional system will allow for the current goal to be met. Diff erent analyses 4-7 have shown that the conventional system fails to meet this supply cost target outside of highly productive regions and could encounter issues even in highly productive regions in some years due to inclement weather (e.g., drought, fl ood, heavy moisture during harvest, etc.). Th ese supply uncertainties increase risks, which could limit the biorefi nery concept from being broadly implemented.

Biofuels 2020: Biorefineries based on lignocellulosic materials

“…biomass pellets or chipped material in the case of woody biomass. An example could be, as described by (Lamers et al, 2015), an intermediate storage where preprocessing of the biomass is carried out. This would decrease logistic costs and provide higher versatility to all facilities.…”

Predictive modeling to de-risk bio-based manufacturing by adapting to variability in lignocellulosic biomass supply

“…This is especially true given the 1) impact of annual and geographic variation on biomass yields and types (Emerson et al, 2014) and 2) process changes, relative to cellulosic ethanol, needed to deploy a slate of products, including hydrocarbons and lignin-derived compounds (Langholtz et al, 2016). Integrating biomass such as energy crops into existing crop rotations and blending these feedstocks with existing wastes and residues available to a bio-refinery will de-risk the logistics of biomass supply (Lamers et al, 2015;Langholtz et al, 2016;Li et al, 2016;Ray et al, 2017;Williams et al, 2016). In contrast to this approach, pioneer bio-refineries in Iowa, Kansas, etc.…”

EISA (Energy Independence and Security Act) compliant ethanol fuel from corn stover in a depot‐based decentralized system

“…Furthermore, the decentralized system using depots and pellets can process and blend pellets more easily from a variety of feedstocks, not just pellets from corn stover. Most of these systemic risks of centralized biorefineries are not accounted for in the models used in this and past papers …”

“…Most of these systemic risks of centralized biorefineries are not accounted for in the models used in this and past papers. 5,[15][16][17] One or two very large-scale depot-based decentralized biorefineries can process about 8-12% of total corn stover S Kim et al…”