Disappointing yields dampen switchgrass enthusiasm

Governments both in the EU and the US view switchgrass and other herbaceous energy crops as plentiful and low-cost alternatives to corn or sugarbeets for making the next generation of biofuels.

As sources of cellulose, such dedicated energy crops can be used as feedstocks for the production of cellulosic ethanol and for synthetic biofuels obtained from the gasification of biomass. The dream of these temperate regions of the planet is to turn their vast prairies and grasslands into energy plantations.

Crude economics
But the price of the switchgrass and similar feedstocks must be kept low enough so that (next-generation) biofuel plants can afford to buy them. Some interesting data from Iowa State University now show that, as things currently stand, the economics of switchgrass do not work out.

The US Energy Department hasn't specified a cost target for switchgrass but does have one for corn: US$35 per ton - needed to keep biofuels competitive. If the experience of switchgrass growers in Iowa is a guide, ethanol plants are going to have to pay a lot more than that for switchgrass.

Farmers in four southern Iowa counties have been growing switchgrass as part of the Chariton Valley Biomass Project, a cooperative effort between the Chariton Valley Resource Conservation and Development Inc., Alliant Energy, Prairie Lands Biomass LLC, and the U.S. Department of Energy.

What they have found is that it costs farmers about US$60 a ton to grow, harvest and bale the grass, including the price of seed, fertilizer and herbicides. It costs another US$25 for storage and transportation costs, and then farmers will need an additional US$30 to US$40 a ton in profit to make it worth their while. In short, cellulose ethanol and synthetic biofuel producers would face feedstock costs of between US$115 and US$120, more than three times those of corn.

A question of yields
Low yields are to blame for the unfavorable economics. Switchgrass yields in the Iowa project have averaged about 3 tons per acre (7.4 tons per hectare), way below what would be necessary to make an ethanol plant competitive: 8 to 12 tons per acre (20 to 30 tons/ha), according to Mark Downing, who analyzes bioenergy markets for the Energy Department.

We can't stress enough that real switchgrass yields - not hoped for, desired or projected yields - are marginal compared to those of tropical grass species, such as sugarcane, sorghum or gynerium sagittatum. In Brazil, in 2005, the average sugarcane yield was 80 tons/ha; many plantations easily yield 120 tons/ha. Trials with new sweet sorghum hybrids in the Philippines showed average yields of 110 tons/ha (earlier post). And plantations of gynerium sagittatum show 50 tons/ha on average. In short, from a purely economic point of view, producing biomass and biofuels in the (sub)tropics makes much more sense than attempting it in the North.

The biomass feedstock cost is the single most important factor determining the viability of biofuels projects. It informs all further decisions on investments in harvesting technologies and logistics - such as transporting, pre-processing and storing. It determines design, scaling and expansion options and opportunities for biofuel plants. It indicates how much land will have to be dedicated to supply a plant of a particular scale. It determines the environmental footprint of the venture. It opens or closes opportunities to create efficient cogeneration facilities that can power the biofuel plant. It determines the risk levels of a biofuel venture as it competes with fossil fuels with their volatile prices, and so on.

Stuck in cornfields?
Switchgrass has been hyped because supposedly it would yield large amounts of affordable biomass and consequently cellulosic ethanol or synthetic biofuels:
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The hope was that by utilising such a dedicated energy crop, land requirements would be reduced. Unfortunately, the first large-scale trials now prove that indeed, much of the enthusiasm was not based on realistic assessments.

Mike Duffy, an Iowa State University economist who has analyzed the project, puts the production costs of switchgrass at US$50 a ton. "There's no $35-a-ton switchgrass," conceded his collegue, Mark Downing. His department is undertaking a study, which will include the use of satellite imagery, soil carbon measurements and climate data, to decide whether and where it might still be feasible to grow the herbaceous energy crops.

He said the high cost of Iowa land is a major impediment to biomass crop production in the state. "That's going to be really tough, to get a farmer to get out of corn and produce switchgrass," he said.

It is not unreasonable to assume that in both the US and the EU, farmers will stick to producing crops like corn for biofuels. Betting on switchgrass may prove to be too risky. But sticking to corn would obviously be disastrous from an environmental perspective - because these fuels have a very low energy balance even though they are commercially viable - and perhaps even more so from a social point of view, because these are food crops that should be consumed as such.

At the Biopact, we obviously present a far more realistic and sustainable alternative, on which we base our entire concept: natural resources and agro-climatic factors leading to good biomass yields, and the need for economic development in the South, make biofuel and biomass production there not only most feasible commercially, but also from an environmental and social point of view.

As many scientists, economists and think tanks have come to understand, Europe and the US should import these fuels, instead of making their own, which contribute marginally to fighting climate change, strengthening energy security or relieving poverty. There is not reason to perpetuate the European and American mirage of 'energy independence', on which so much of the switchgrass hype was based. Interdependence and a diversification of biofuel supplies, opening world markets for biofuel trade from the South and ending the market distorting US/EU subsidies for bad biofuel crops such as corn, is the way forward.

Image: harvesting switchgrass, yields of which are way below expectations. Courtesy of the Chariton Valley Biomass Project.