The role of Alternative Fuels in Sustainable Heavy Duty Transport

Jonas Strmberg
Director Sustainable Solutions Scania CV AB

Provider of Transport Solutions

Haulage

Construction

Distribution

Special purpose

Network and services

City and suburban

Intercity and coach

Used vehicles

Engines

Todays Agenda

Drivers for Sustainable Transport Solutions the Green Toolbox Focus: Biofuels Good examples Questions and Discussion

Many Drivers for Sustainable Transport

Climate Change Peak Oil Local Energy Security Diesel shortage Urbanization Air Quality Congestion Increase of transportation Policies Green image Urbanization

Drivers for Sustainable Transport

Climate Change The Elephant in the Room

Rapid environmental change is underway Current policies are far from enough Transport sector is one of the fastest growing emitters

Peak interval

Actual IEA Shell Hubbert model

The flow/day is key!

Peak Oil Local Energy Security

The diesel shortage High costs for net importers and problems for heavy duty transport. Diesel substitutes essential!

Fuel security

Who will feel the oil pressure?

A double challenge: To replace oil and reduce CO2 simultaneously...

Oil use in OECD

120 100 80 60 40 20
Oil use in the OECD

Other sectors
Transport sector

73 %

0 1970

2010

Transport Sector to 96% dependent on oil

Energy security

Global population growth 1950-2100

Rapid Urbanization
ASIA

High % of GDP used for oil/diesel imports

AFRICA

How to achieve sustainable mobility of people and goods in fast-growing countries and cities?
Source: United Nations, Department of Economic and Social Affairs The 2010 Revision. (Updated: 15 April 2011)

Asian/African transport challenges

More people die from air pollution than from traffic accidents

Congestion, air quality and health

Climate Change and CO2

Air Quality & Congestion

Are you part of the problem? Transports Peak Oil & Energy part of the solution? oil addiction Or Security
Oil use in OECD
120 100 80 60 40 20 0 1970 1970: Index 100 1980

Other sectors
Transport sector
1990

>73 %

2000

13

The diesel shortage High costs for net importers and problems for heavy duty transport. Diesel substitutes essential!

Fuel security

Most important sustainability challenges for the heavy transport sector

1. Local Emissions (Particles, NOx, etc) 2. Energy Efficiency 3. Emissions of fossil CO2

1. Local Emissions
Driven by Legislation
NOx

PARTICLES

2. Energy Efficiency
100 % Market driven
Euro
litres/100 km 50

4 5

45
40 35 30 25 20

Market driven
The no 1 competetive factor All commercial measures automatically applied Rising fuel prices increase the competition
92 96 01 06 09

1950

1960

1970

1980

1990

2000

2010

2020

3. But what about the big challenge?

Fossil CO2 from the transport sector

Data from TREMOVE

Projected CO2-emissions from road transport in EU

Energy Efficiency and new technology is not enough!

Energy use and local emissions decreases continuously CO2 is not... Future technology is always just around the corner but to break transports increasing CO2 emissions and oil dependency

CO2-emissions from road transport

we need commercial volume solutions here and now!

Data projection from TREMOVE

No single magic solution a green toolbox

Scania vision for CO2 reduction from transport

19

Engine Rolling resistance Aerodynamics Payload

CO2 per tkm

1. Logistics and Smarter Transport 2. Driver 3. Vehicle technology 4. Biofuels

50%
1970 2000

50%
2020

Biofuels are one of the most cost efficient ways of reducing CO2 emissions in heavy transport Fuel CO2
Regular spec
Ecolution spec Driver training Biofuel Maintenance+

Ecolution commercial green tools

No single magic solution a green toolbox

Which tools gives most CO2 reduction for your money?

Biofuels are one of the most cost efficient ways of reducing CO2 emissions in heavy transport
Regular spec
Ecolution spec Driver training Biofuel Maintenance+

Fuel CO2

Ecolution commercial green tools

Fuel CO2

Regular specification
Ecolution spec Driver training

Biofuels

Biofuels are key in decarbonizing heavy transport!

Bioethanol
Worlds No. 1 biofuel Diesel engine & efficiency Average 71 % CO2 reduction (EU) Buses, coaches waste collectors, distribution trucks.

Biodiesel
Low blends to B100 Diesel engine Average 38 % CO2 reduction (EU) All types of applications, including long-haulage and coaches.

Biogas
Mixes with CNG Otto engine Average 73 % CO2 reduction (EU) City/Intercity buses, waste collectors, distribution trucks.

Buses & Trucks for the 3 major biofuels

Ethanol fuel ED95

Cost Efficient & Sustainable Diesel Replacement
Ethanol fuel ED95 95% ethanol, 5% additive EU engine certification fuel Highly efficient diesel combustion Ethanol up to 43% efficiency Diesel up to 44% efficiency Scania modular system Minor changes to standard diesel engine Very similar to diesel operation Proven technology Third generation engine In commercial traffic since 1986

Euro 5/EEV

 A local biofuel
A clean fuel

A renewable fuel
Solving waste problems Mixes with CNG Scania a part of SymbioCity: Swedish biogas expertise - from waste to bus!

Alternative Fuels Seminar - Method & Arguments 9-10th Sept 2010

From waste to clean biogas fleets

Fuel quality

Biodiesel could be produced from a variety of oil plants (rape, soy or palm most common) - with varying quality. Cold flow properties vary between markets.

Bodywork

Fuel standard EN/BS14214 very important!

Work with a knowledgeable fuel supplier.

Temperature Biodiesel is a strong solvent - bodybuilders must use material resistant to biodiesel. Ensure that auxiliary equipment can run on biodiesel. Oil and fuel filter change interval may be affected.

Auxiliary equipment

Maintenance

Up to B100 available in most Scania products

Biodiesel operation

 Reduced Oil Dependency Local Energy Security

Avoid Diesel Shortage Rural Development

Avoid even worse fossil alternatives

(Oil from deep water, shale and tar sands, coal and gas to liquids, etc.)

Job Creation
More Efficient Land Use Co-products

Biofuels Many synergies

Cost efficiency of biofuels (IEA Blue Map Scenario)

Sustainability - IEA Blue Map Scenario

Biofuel Production Costs 2010-50

Production costs shown as untaxed retail price

Most conventional biofuels still have some potential for cost improvements Advanced biofuels reach cost parity around 2030 in an optimistic case

Most biofuels are sustainable today

There are both good and bad biofuels But today the market is strongly regulated by sustainability standards EU regulation toughest Most biofuels are therefore sustainable today work with certified producers! But oil is also becoming more and more unsustainable Tar sands, deep sea, fracking

Biofuel production pathway

Average GHG emission saving

Sugar beet ethanol

52%

Wheat ethanol, 47% NG as process fuel

Wheat ethanol, straw as fuel

Sugar cane ethanol RME (Biodiesel) Waste oil FAME (Biodiesel) Biogas from organic waste

69%
71% 38% 83% 73%

[From Annex V of the EU RED directive]

Biofuel myths, land use and food vs fuel

Most food production from increased efficiency on existing land, not from new land (FAO). Big potential to increase production of both sustainable biofuels and food especially in EU, Latin America and Africa
In EU alone 40 MHa of abandoned farmland. Global biofuel production = 30 MHa

Grain production

Land use

Potential for cropland expansion

Coffee or golf, anyone? Proper land use policies/management for all types of land use necessary biofuel policy lead the way. Enough land for food, fuel AND other activities

> 2,5 billion hectares available

NOx
g/kWh

Diesel and Biofuel Engines Local Emissions

Diesel Euro 2

Diesel Euro 4

Ethanol Biogas

Particulates
g/kWh

Cleaning up our cities

1986

Electrification only one part of the future puzzle

Scania have tested and run hybrids since the 1980s Hybrids will have to stand on its own merits
Bottleneck still energy storage batteries Components developed for cars are not suitable for HD-transport Cost level and lifetime not yet on commercial level

1995

1995

1996

Electric power transfer from the road or at bus stops a more attractive future possibility than batteries?
Research project with Bombardier on inductive power transfer

1997

2007

Production of electricity must also be clean elsewhere emissions Scania have tested and run hybrids since the 1980s 2011

all fuel and CO2 reduction tools are supporting each other not competing. Do not let the best be the enemy of the good

Eco-spec

Separated bus lane

 Type of operation?

Biofuel availability?

With a unique portfolio of products, infrastructure Fuel infrastructure? and partners, Scania can always find the most cost Fuel quality? efficient biofuel solution Total cost/km for different biofuels? for any customer case Most emission reductions/$?

Biofuels local markets local solutions

How to get started

The BEST project experience*
City policy/procurement important Heavy fleets represent a large proportion of emissions (~50%) Depot based traffic infrastructure costs kept low Possibilities to quickly replace vehicles, build volumes and reach scale advantages
*EU-project alternative fuels www.best-europe.org

Start with heavy fleets

Functional tender demands Cost efficiency How much CO2 cuts or mobility for your money?

Focus on volume solutions that make a real difference. Not on silver bullets

BEFORE
CLEAN VEHICLES

AFTER
CLEAN VEHICLES

Biofuels + Bus Systems = Sustainable Transport

140 120 100 80 60 40 20 0
Car Automvel Diesel bus nibus diesel Biofuel bus nibus etanol g CO2/pkm

Stockholm 100% biofuels in city transport

All buses on biofuels in Stockholm Ethanol (800), Biogas (240) and Biodiesel (100) Also introduced for waste collect & trucks

Big effect on both air quality and CO2

Focus: Cost efficient CO2 reduction Long term policy & key actors co-op

A good example - I

Service, fuel and capital costs

70000 km/y, city bus 12 m, Sweden

Cost distribution biofuel operation

 Local bioethanol in bus operations in Johannesburg

Ethanol from locally grown sugar beets Verified according to the Worlds strictest sustainability regulations 78% reductions of fossil CO2 Local fuel local jobs/energy security 1 bus/truck: 2 new jobs in fuel production Replaces 50 000 litres of diesel

A good example - II

Package solutions for bus systems, vehicles, biofuels, service and infrastructure are available here and now!

Public transport & BRT

Distribution & Waste

Power Supply

Biofuel, service & infrastructure

 Biofuels key for HD transport to decarbonize Multi-fuel future, local energy, local partnerships Ethanol, biodiesel and biogas only viable commercial options, both now and in the foreseeable future Ethanol will dominate the biofuel market for a foreseeable future also as a diesel substitute! Biogas small but a good solution for city/intercity fleets CNG/LNG likely to be a cheap fossil diesel/petrol substitute Biodiesel (especially in EU) - possible future problems with cost, sustainability demands, and necessary fuel quality? All biofuels developing... Cellulosic feedstock, 2nd gen biodiesel/HVOs, etc. But 2nd gen not commercial until 2025... ...and no silver bullet in sight start with todays commercial solutions here and now!

46

Biofuel conclusions

Biofuels are not difficult!

They are here and now!

jonas.stromberg@scania.com

How to get there conclusions

More functional and long term transport procurement is key:
Many tools no magic solution do not let the best be the enemy of the good use functional demands for CO2 cuts that allows for all tools to be used most cost efficient emission cuts

Short term view and focus on up-front price prevent investments in

robust, well-maintained and clean quality vehicles Functional and long term demands for e.g:
lowest cost per km over a 10-15 year life cycle minimum uptime levels over a 10-15 year life cycle maximum local emission levels

More

kms and emission cuts for each $ invested

Service quality economy/efficiency Challenges

Random mode Self-made experts Parts supply? Quality? Uptime?

Service contracts
Skilled staff! Planned service! Parts logistics! Quality! Uptime!

Also other resources are getting scarce

Source: DOE Critical Materials Strategy 2010

Rapid growth of biofuels, now

and in the future

Global biofuel supply grows from 2.5 EJ today to 32 EJ in 2050

Biofuels share in total transport fuel increases from 2% today, to 27% in 2050 Diesel/kerosene-type biofuels key to decarbonize heavy transport modes

IEA Biofuel Roadmap

Functional tender demands Cost efficiency How much CO2 cuts or mobility for your money?

Focus on volume solutions that make a real difference. Not on silver bullets

Todays Agenda

Scania on Sustainable Transport

Drivers Tools and solutions Focus: Biofuels/Alternative fuels Challenges and possibilites

Discussion

ExaJoule

600 500 400 300 200

500 EJ 440 EJ

45-220 EJ
100 0 Energy Use (Global) Transport Energy Use Technically Available Biomass Agricultural Waste
Source: IPCC

90 EJ

Biomass a big energy resource

2050 Bioenergy Potentials & Deployment Levels

Past Literature Range of Technical Potentials 0-1500 EJ Technical Potential Based on 2008 Model and Literature Assessment Availability of sustainable bioenergy/biofuels is 100-300 EJ to 2050. (Todays total global energy use is 500 EJ) In EU alone, 25-40 Mha of abandoned farmland is available.

Global Primary Energy Supply, EJ/y

2050 Global Energy AR4, 2007 2008 Global Energy Total

2000 Total Biomass Harvest for Food/Fodder/Fiber as Energy Content

Technical Potential 2050 Global Biomass AR4, 2007

Land Use 3 and 5 million km2

Chapter 2 Possible Deployment Levels 2011 IPCC Review*

Chapter 10 Modelled Deployment Levels for CO2 Concentration Targets

440600 ppm

<440 ppm 300 Maximum

300

265

Percentile
190 150 118 20
75th

2008 Global Biomass Energy

Copernicus Institute

median
25th

100

80

25 Minimum

Sustainable Development and Innovation Management

2050 Projections

[IPCC-SRREN, 2011]

BUILDINGS

DESERTS MOUNTAINS, ETC

Tobacco Coffee Tea Golf Courses

FORESTS

FARMLAND

Energy Crops

GRAZING

All types of land use compete with other types of land use. In EU, total farm land use decrease but biofuel production increase. Biofuels have not caused the 2006-2008 food price increase. (World Bank) 80-90% of increased food production has and will come from increased yield and more efficient farming, only 10-20% from new land (World Food Org. FAO)

Global land use

Source: FAO, OECD

Ethanol Rainforest Myth