Biofuels and the role of innovation

Unfortunately there is no silver bullet to solve the challenge of climate change. This means that low-carbon technologies will be required to significantly reduce carbon emissions. Many see this transformation as a cost to the economy but responding to climate change represents a huge commercial business opportunity through the creation of new markets. Bioenergy has the potential to decarbonise electricity generation, heat and transport in the UK and globally.

Liquid biofuels used for transport are particularly controversial. They appear to have as many dissenters as advocates. Advocates see a dispatchable renewable energy source, which can use existing infrastructure, can be domestically sourced, and could be used to generate low-carbon electricity when combined with Carbon Capture and Storage (CCS). However, dissenters see an energy source that competes with food for agricultural land, creates emissions from land use change, generates air quality concerns and can impact negatively on biodiversity. The debate around bioenergy has moved on in recent years from "can this be done sustainably" to "how much of this can we deploy sustainably and equitably?". Indeed the UK Government's  Bioenergy Strategy states that only sustainable deployment will be acceptable in the UK and calculates that around a tenth of UK energy could be provided by bioenergy by 2050. That is significant and we must continue to unlock its potential.

The key to this, and ensuring sustainable deployment goals are met, lies in innovation. Innovation offers the chance to increase deployment of more sustainable feedstocks and to develop and refine the technologies that can convert these as well as waste to useful energy outputs. Analysis by the Carbon Trust for the Government found that innovation has the potential to reduce UK energy system costs by £42bn by 2050. International business development is calculated to provide further economic value to the UK to the tune of £19 bn.  

So where to innovate? When looking at priorities for innovation in biofuels in the UK, we found that the highest priority comes from woody and grassy crops with higher yields on marginal land, advanced biofuels demonstration, proof of integrated gasification systems at scale, and high efficiency biopower systems that are robust to a variety of feedstocks and ready for CCS. 

Looking beyond the UK, one sector where we believe biofuels innovation is critical to unlock potential is aviation. This is a fast-growing sector where very few alternatives to fossil fuels exist and represents an ideal market to focus on fast-tracking the commercialisation of biofuels. The sector is seeking a single 'drop-in' solution and has a manageable number of major re-fuelling locations whilst its large players are aligned around the nature of the challenge and willing to collaborate to find solutions. By focusing on this sector we believe biofuels will be able to truly show their worth.

This article was originally published on The Economist Management Thinking blog at: