#Bioenergy

The use of bioenergy is projected to expand significantly in all scenarios, especially for the net-zero scenarios. This expansion is based primarily on the deployment of new and advanced biofuel technologies using cellulosic feedstocks. Existing liquid biofuel production (such as corn-based ethanol) is assumed to be gradually phased out and replaced by next-generation biofuels. Existing use of biomass residues, such as in the pulp and paper industry, is projected to continue, subject to growth assumptions in the underlying activity. The scenarios also include increased supply from waste methane sources, such as landfill gas, but these sources are relatively limited in quantity.

The potential supply of cellulosic feedstocks consists of residues, such as agricultural waste, purpose-grown energy crops, such as miscanthus, switchgrass, and hybrid poplar, and hardwood and softwood logs. The supply of residues is a function of the associated agriculture and commodity markets and production, as well as the costs of handling and processing the residue streams. The supply of energy crops and logs depends on the productivity and opportunity cost of land for production. The delivered cost of all cellulosic feedstocks considers transportation and annual storage. For this analysis, regional supply curves for a broad range of cellulosic feedstocks were developed using a detailed land use and agricultural model^[1] to capture constraints and interactions with commodity markets and competing land uses. Although energy crops would require land for production, many factors influence the type of land utilized over time, including changes in relative yield, market conditions, and land management opportunities. By 2050, the land-use modeling projects an expansion of cropland and forest land into marginal, pasture, and set-aside lands with an increased supply of biomass feedstocks for energy. The net effect on terrestrial carbon stocks is neutral or possibly even increasing due to higher carbon content above ground and in soils. Based on these results, our scenarios assume that bioenergy is an effectively zero-carbon primary resource.

To explore sensitivity to the available supply of energy crops and logs, the Higher Fuel Cost and Limited Options scenarios in this analysis assumed a much more limited quantity of potential primary production from energy crops and logs (supply curves shown in Figure 6). The current primary energy supply for existing corn-based ethanol production is approximately 2 quad Btu. The total potential supply from cellulosic energy crops and logs based on the land-use modeling is 29 quad Btu (up to a price of $40/MMBtu). In the two scenarios with limited bioenergy supply, the potential supply from energy crops and logs is reduced to 14% of the total modeled potential, or around 4 quad Btu, which equates to roughly double the current level of production of corn for energy. In both scenarios, the total potential from residues is 7 quad Btu (at $40/MMBtu). Note that these quantities refer to the primary feedstock supply. The conversion of feedstocks to end-use fuels such as liquids and gases requires a conversion step with significant associated losses on the order of 50%.

The annual production and use of bioenergy projected by 2050 across scenarios are summarized in Figure 29. In the Reference scenario, cellulosic biofuel production increases somewhat relative to today because, at the lowest cost feedstock levels (which are quantity-limited), advanced liquid biofuels become competitive with conventional petroleum liquids even without an implicit carbon price. At the same time, electrification of transportation is driving down demand for liquid fuels, particularly gasoline and diesel, although this demand only gradually declines and does not reach zero. Thus, biofuels are providing an increasing share of a decreasing market. In the Net-Zero scenarios, the production of bioenergy increases further for two reasons. First, the carbon target introduces stronger incentives to replace petroleum liquids and other fossil fuels with bio-based alternatives. Second, the capture of CO₂ from bio-conversion processes creates valuable opportunities for carbon management. Captured biogenic CO₂ may be stored underground in the scenarios where geologic storage is assumed to be available, resulting in a net withdrawal of carbon from the atmosphere (or “negative” emissions) that can offset other positive emissions. Alternatively, that CO₂ can be used along with hydrogen as an input to synthetic fuel production, effectively increasing the yield of carbon-neutral fuel output from bioenergy feedstocks. Both directly produced biofuels and synthetic fuels production augmented by hydrogen are assumed to be “drop-in” equivalent to conventional hydrocarbons. However, synthetic fuels require additional capital and energy inputs and are thus more expensive to produce.

In the Net-Zero All Options scenario, primary production of cellulosic biomass feedstocks increases to around 22 quad Btu total, of which 6 are from residues, and 16 are from energy crops and logs. Most of this primary supply is directed toward liquid fuels, whose net production is approximately 9 quad Btu (see Figure 34). There is also some biomass directed to hydrogen production and power generation, as well as a small amount of solid biomass used for industrial process heat and buildings. Note that there is no conversion of cellulosic feedstocks to renewable natural gas in this scenario, which is less competitive with the fossil-based alternative due to the low commodity cost of natural gas in the U.S. However, a small amount of renewable natural gas from waste methane is added to the pipeline gas supply mix. All of the conversions to liquid fuels, hydrogen, and electricity are deployed with carbon capture and storage, resulting in nearly 1 GtCO₂ of negative emissions. The carbon offset value of these negative emissions is a major factor in the economics of the bio-conversion activity.

In the Net-Zero Higher Fuel Cost scenario, there are much more limited quantities of energy crops and logs, which drives up the price of bioenergy and leads to lower quantities supplied. In particular, there is lower demand for liquid biofuels, which also reduces the scale of the opportunity for negative emissions from carbon capture of process emissions from liquid fuel conversion. There is an increase in demand for bioenergy for power generation with CCS to provide additional negative emissions. Because of the constraints and higher marginal costs associated with bioenergy production in this scenario, direct air capture is also used to provide negative emissions (see Figure 7).

In the Net-Zero Limited Options, there is no opportunity for negative emissions from CCS, which creates stronger incentives for low-carbon alternatives to fossil fuels. Hence there is more demand for bioenergy despite the lack of carbon offset value, which corresponds to even higher delivered prices for biofuels, as the supply curve becomes extremely steep (see Figure 6). In this scenario, there is also a broader range of final energy fuels produced from bioenergy, with about a third of bioenergy production going to renewable natural gas (via gasification of cellulosic feedstocks). Although geologic storage of CO₂ is not available in this scenario, bioenergy conversion technologies still employ carbon capture, with the CO₂ flow utilized as an input to synthetic fuel production.

The regional allocation of biomass supply depends on relative regional differences in agriculture and forestry markets and land availability and productivity. The majority of the production of biomass for energy is supplied by the Midwest and South, with relatively little coming from the West. Note that new bioenergy conversion facilities are assumed to be co-located with feedstock collection points, but the fuels themselves can be readily delivered to markets in other regions.