Advanced biofuels are based on the same chemical platform of carbon, hydrogen and oxygen as oil refineries, so therefore technically the biomass-to-fuels conversion processes can produce products similar or identical to those produced by today’s petrochemical industry. The impact of such a development on costs and revenues are not part of the price projections, as many of the processes are still at a pre-commercial level.
However, we can get an idea of how advanced biofuels will develop when comparing them with the development of fossil oil products. Around 1850, when kerosene substituted whale oil, only 15% of the oil could be used, while the remaining 85% was waste or of very low value. Technologies soon started to develop enabling the use of diesel and gasoline.
Later on, the development of high-pressure chemistry laid the foundation for the modern chemical industry. In 2014, fuel products make up 94% of the fossil product mix, but only 50% of the revenue. The remaining 50% of the revenue comes from just 6% of the oil processed into chemicals [A] .
Biofuel technologies are much in the same situation as oil was in 1850, and a similar development will take place for biomass refining starting with a partial conversion to fuel products followed by higher efficiency and the inclusion of high value chemicals. This will further drive down the costs of advanced biofuels beyond the cost projections and economic models, and in the end provide highly competitive advanced biofuels together with bio-based chemicals and materials.
The speed and extent of such a development cannot be fully predicted. It depends on markets and policy drivers, but that it will happen and in a shorter time span than for fossil products is inevitable once the industry is established.