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Biofuels development: Singapore powering ahead, but gaps remain

Singapore is charging forward in a bid to be a powerhouse in renewable energy.

Early this month, Finnish firm Neste Oil officially opened in Tuas the world’s largest plant to make biodiesel using palm oil, palm waste and waste animal fat.

The plant, which exports to Europe and North America, joins those of other renewable-energy giants which opened here recently: Danish wind-power firm Vestas and Norwegian solar-energy company Renewable Energy Corporation.

Earlier this month, Singapore hosted a conference on energy harnessed from biological sources like plants and algae. Part of the prestigious Keystone Symposia series, it was attended by scientists worldwide.

At the Neste Oil plant opening, Deputy Prime Minister Teo Chee Hean said: ‘In Singapore, we are actively pursuing projects that could leverage biorenewable raw materials for the production of fuels, as well as for the production of chemical products.’

European aerospace and defence firm EADS last year started a year-long partnership with the Agency for Science, Technology and Research (A*Star) to study whether microalgae could be used as a source of jet fuel.

But it will take at least six years before algal fuel can be used effectively as fuel feedstock, said Neste Oil chief executive Matti Lievonen. The firm is also doing research on algal biofuel overseas.

The Economic Development Board is carrying out a study of materials like palm oil, sugarcane and plant biomass as feedstock for Jurong Island plants to produce plastics, chemicals and other industrial polymers.

Small firms like Alpha Biodiesel have seen some success in refining waste oil.

Researchers and industry players believe more can be done. For one thing, demand for biofuels is still driven by government mandate and not by price.

For example, governments in Europe and North America have ruled that transportation fuels must contain a certain amount of biodiesel.

In the euro zone, 5.75 per cent of transport fuel must be biobased. For the United States, 800 million gallons of biomass-based diesel is mandated for this year.

That is why such countries represent the biggest market for Neste and other biodiesel makers. No country in Asia has adopted any such mandate and Mr Lievonen said, in the next five years, Asia is ‘not going to be a big market for us’.

Malaysia, though, is expected to adopt a biofuel mandate in some states this year, which will support the country’s palm oil industry.

Singapore could boost demand for renewable energy - not necessarily by adopting legislation, but by putting a price on the higher carbon emissions of fossil fuels.

It could be a tax on carbon emissions or an official cap on the amount of carbon that can be emitted, and allowing companies to buy carbon credits.

But these proposals may be too bold for Singapore, said A*Star Science and Engineering Council chair Charles Zukoski. ‘Singapore won’t lead in terms of carbon taxes but it’s also clear that the Government isn’t going to lag behind either,’ he said.

It is already taking steps to curb energy use. He added: ‘Car quotas, energy efficiency, building consumption and smart grids for the local population… these things are being pursued.’

Said Mr Lim Chuan Poh, A*Star’s chairman, at the biofuels conference: ‘Singapore has identified the clean energy industry as a strategic growth area since 2007, and had begun to implement a comprehensive blueprint to grow the industry.’

Typically, interest in biofuels waxes and wanes with the price of oil. In July 2008, for instance, oil hit US$145 a barrel - and in September that year, the US Department of Energy offered six universities US$4.4 million in biofuel research funding.

Right now, oil prices are high - around US$99 a barrel. Industry players and researchers worry, however, that if prices drop again, so will excitement over biofuels.

Total global biofuel production currently accounts for about 1 per cent of traded energy, or about 20 billion gallons a year, and a US$40 billion (S$51 billion) market. But it is expected to reach 144 billion gallons per year by 2022, based on standards set by various governments for renewable energy use.

The lack of supply-side mandates also affects business. For example, Mr Edwin Khew, whose firm IUT Global converts food waste into biogas for electricity, has long bemoaned the lack of laws to require food outlets to recycle their waste.

Locally, what more can be done?

Dr Wong Pui Kwan of A*Star’s Institute of Chemical and Engineering Sciences is looking at producing high-value polymers and chemicals from biobased feedstocks.

And high-protein by-products of algal oil production could be tapped for animal feed, suggested algal fuel researcher Jeffrey Obbard, who is based in Hawaii.

Top of the wish list for A*Star’s Mr Zukoski is for Singapore to build a larger-than-lab-scale demonstration plant to show that it can be ramped up to commercial scale.

Such a plant could handle high-density algal oil, for example, cultivated in a neighbouring country, and that has already undergone some basic refining there.

But, Dr Zukoski explained, when it comes to both biofuels and renewable energy in general, there is no single ‘silver bullet’ technology that can replace fossil fuels. It will have to be ‘silver buckshot’ instead, he said.

Current initiatives

  • Neste Oil has opened the world’s largest biodiesel plant that uses palm oil, palm waste and waste animal fat.
  • European aerospace and defence firm EADS has started a year-long partnership with A*Star to study whether microalgae could be used as a source of jet fuel.

Lack of mandate in region

  • Demand for biofuels is still driven by government mandate and not by price, and no country in Asia has mandated that transportation fuels contain a certain amount of biodiesel.

What Singapore can do

  • Impose a tax on carbon emissions or cap the amount of carbon that can be emitted.
  • Build a larger-than-lab-scale plant to demonstrate that high-value polymers and chemicals from biobased feedstocks can be ramped up to commercial scale.

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