Growing Biofuels

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First, Choren's process heats biomass to 500 C, causing the tars to turn into a gas. The coal-like char left behind is then ground into a powder and blown into a high-temperature chamber, along with the gaseous tar. The resulting chemical reactions and temperatures as high as 1600 C break down the tars and simultaneously convert the carbon char into syngas pure enough for Fischer-Tropsch chemistry.

Steve Brown, Shell's London-based commercial manager for biofuels, says the result is a domestically produced fuel that outperforms both petroleum and plant oil-based biodiesel. Brown says studies that account for each joule of energy consumed in growing or pumping feedstock and fuel production show motoring on gasification biodiesel produces 85-90 percent less climate-changing carbon dioxide than using fossil diesel, while conventional biodiesel offers only a 50 percent reduction.

Using Choren's biodiesel also generates less soot and smog because the fuel contains none of the sulfur found in conventional diesel and few aromatic hydrocarbons, such as benzene. Carmakers DaimlerChrylser and Volkswagen, which helped finance Choren's pilot plant, test-drove on its fuels and measured a 30-50 percent drop in exhaust soot and up to 90 percent less smog-forming pollutants, compared to the cleanest grades of conventional diesel.

Shell's cash and expertise is helping Choren build the world's first commercial biomass-to-biodiesel plant. By early 2007, the company expects to be consuming approximately 67,000 tons of biomass and pumping out 15,000 tons of biodiesel annually. If all goes well, Choren plans to build a series of larger plants each capable of pumping 200,000 tons of biodiesel per year.

Even at that scale, though, Choren's biodiesel will be pricey. Rudloff predicts that Choren will produce biodiesel for €0.70 per liter (about $3.10 per gallon). That is marginally more than the cost of conventional biodiesel and two to three times more than wholesale diesel in the United States.

However, Shell's Brown cautions that biodiesel's price per liter is not the whole story. He says Shell believes biofuels use will double over the next five years because it responds to government pressures to reduce carbon emissions and to strengthen energy security, and that these advantages will be ultimately be rewarded. "The price per liter might be higher," says Brown, "but it might be very competitive in terms of price per gram of CO₂ saved."

Brown says government incentives are already leveling the playing field. Many European countries, including Germany, Austria, Italy, and Spain, exempt biodiesel from their hefty fuel taxes. Diesel fuel currently sells for €1.05 per liter in Freiberg, of which €0.65 is tax. That leaves plenty of room to guarantee biodiesel producers such as Choren and Shell a profit.

It's not surprising, then, that in Germany -- Europe's leader in biodiesel production and consumption -- Shell is now a major distributor of conventional biodiesel. Currently, the company purchases its biodiesel from independent suppliers and then blends up to 5 percent into the diesel its sells across Germany. No doubt, they'd prefer to sell their own.