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Economic analysis of novel synergistic biofuel (H2Bioil) processes

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Abstract

Fast-pyrolysis based processes can be built on small-scale and have higher process carbon and energy efficiency as compared to other options. H2Bioil is a novel process based on biomass fast-hydropyrolysis and subsequent hydrodeoxygenation (HDO) and can potentially provide high yields of high energy density liquid fuel at relatively low hydrogen consumption. This paper contains a comprehensive financial analysis of the H2Bioil process with hydrogen derived from different sources. Three different carbon tax scenarios are analyzed: no carbon tax, $55/metric ton carbon tax and $110/metric ton carbon tax. The break-even crude oil price for a delivered biomass cost of $94/metric ton when hydrogen is derived from coal, natural gas or nuclear energy ranges from $103 to $116/bbl for no carbon tax and even lower ($99–$111/bbl) for the carbon tax scenarios. This break-even crude oil price compares favorably with the literature estimated prices of fuels from alternate biochemical and thermochemical routes. The impact of the chosen carbon tax is found to be limited relative to the impact of the H2 source on the H2Bioil break-even price. The economic robustness of the processes for hydrogen derived from coal, natural gas, or nuclear energy is seen by an estimated break-even crude oil price of $114–$126/bbl when biomass cost is increased to $121/metric ton.

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Abbreviations

HDO:

Hydrodeoxygenation

NPV:

Net present value

IRR:

Internal rate of return

B:C:

Benefit to cost ratio

PV:

Present value

H2CAR:

Hybrid hydrogen-carbon

H2Bioil:

Hydrogen Bio-oil

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Acknowledgments

Several discussions with Professors W. Nicholas Delgass and Fabio H. Ribeiro are gratefully acknowledged. The authors would like to thank Solar Economy IGERT (Grant No. NSF 0903670) and the US Department of Energy (Grant No. DE-FG316-08GO18087) for the support of this work.

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Authors and Affiliations

  1. School of Chemical Engineering, Purdue University, West Lafayette, IN, 47907, USA

    Navneet R. Singh, Dharik S. Mallapragada & Rakesh Agrawal

  2. Department of Agricultural Economics, Purdue University, West Lafayette, IN, 47907, USA

    Wallace E. Tyner

Authors
  1. Navneet R. Singh
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  2. Dharik S. Mallapragada
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  3. Rakesh Agrawal
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  4. Wallace E. Tyner
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Corresponding authors

Correspondence to Rakesh Agrawal or Wallace E. Tyner.

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Singh, N.R., Mallapragada, D.S., Agrawal, R. et al. Economic analysis of novel synergistic biofuel (H2Bioil) processes. Biomass Conv. Bioref. 2, 141–148 (2012). https://doi.org/10.1007/s13399-012-0043-5

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  • DOI: https://doi.org/10.1007/s13399-012-0043-5

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