Parratt & Associates Scoping Biorefineries: Temperate Biomass Value Chains

5.8 Research and Development across the Value Chain

A whole of value chain approach is necessary to enable the capture of the value add at various components along the chain. For growers to invest in new technologies to harvest, store and manage crop and forest residues they will require an assured price and return on investment that is above alternate crops or uses of the residues. In order for rail and road transport operators to provide purpose built and dedicated transport, they will require an assured price to supply, long-term contracts with biorefineries. There is also the question of the development of appropriate infrastructure at railheads, intermodal transport hubs and port facilities. An assured supply of biomass is also required for the development of biorefineries of scale, with high efficiencies, product quality and quantity. The biomass must be at a price that enables efficiencies to be captured, whilst also providing the level of investment necessary to deliver the efficiency and throughput through the refinery. Finally, the downstream chemical industry will require an assured product of sufficient quality and quantity that will allow them to compete with the existing petrochemical-based suppliers during the transition to a bioeconomy.

Across the Australian value chain for temperate biomass transformation to actual bioproducts, research and development is small by international standards. IEA through Task 42 has reviewed research outside of Europe²⁰⁵. A major reason for this comparatively low level of research and development in Australia is the much higher level of industry and government support programs internationally. This is primarily a result of global drivers of energy security, food security and climate change being addressed by direct government intervention and support to the chemical and materials sectors to move away from non-renewable resources.

Since the 2007 report by Haritos for the RIRDC²⁰⁶ little appears to have changed in terms of the research outcomes. Research gaps identified in the report included;

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  on-going demand for new and innovative biobased products with desirable attributes for industry, including low energy costs of production;
  
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  routes to high purity, cost-effective production of the raw materials needed for biobased products;
  
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  cost-effective methods of downstream biomass processing to enrich biobased product fractions;
  
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  maximize financial return from processing of biomass containing only the primary characteristic of interest and with reduced waste;
  
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  documented claims of environmental sustainability for biobased products;
  
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  fulfil regulatory requirements for the production of biobased feedstock;
  
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  identify characteristics and potential markets for novel biobased products,;
  
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  communication strategies to inform stakeholders of the benefits of biobased products to the environment, sustainable agriculture and rural economies; and
  
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  build research capacity in discovery, production and development of biobased products and facilitate commercialization of new products in Australia.
  

These gaps are still evident today. Some companies identified by RIRDC have either ceased to exist, morphed or are struggling in the current economic and policy environment. Recently, CSIRO closed its Forestry Division and merged aspects of its activities into other Divisions.

Clearly there is research into biorefinery development is still being undertaken within Australia. However there are views to suggest that this research is currently disconnected uncoordinated and non-strategic. These views were expressed in workshops and discussions with many senior public servants, industry representatives and researchers during interviews that have formed the basis for comments in previous and following chapters. One company claimed that for any activity to be undertaken in Australia could only be ‘off the back’ of research and development from overseas.

The National Collaborative Research Infrastructure Strategy (NCRIS) provided $32M for the development of research facilities and access for commercial and research organisations to high quality laboratories. The program has been hailed as a success by many, because it provided much-needed research infrastructure however, the delivery of the facilities has been slow, and there is little operating funding for the ongoing management and upgrading of the resources. There is only one facility dedicated to development of existing biomass, i.e. the Mackay Renewable Biocommodities pilot plant. Access to this facility by researchers of temperate based biomass and companies is logistically and technologically difficult, however. Historically, NCRIS facilities tend to be under-resourced, under-utilised and ‘captured’ by the hosting institutions. A survey of Australian universities, CRC and CSIRO suggests that research efforts in biobased products is now slowly getting underway at the NCRIS facilities, This may also point to heightened interest in applying industrial biotechnology to pressing issues of fuel security, food security, land use management and climate change.

The following glimpse of Australian Research and Development into temperate biomass is undoubtedly incomplete, because several companies’ and research institutions’ confidential research programs cannot be accessed.

1. Agriculture

Australia is well served by a number of rural research and development corporations and departments of agriculture focused on new product development and sustainability on the ‘farm’. The key agricultural sectors likely to impact directly on temperate biomass development are the grains and the forestry industry. The Grains Research and Development Corporation (GRDC) and the Forest and Wood Products Australia have major responsibilities for the development of their industry sectors. In recent years neither of these rural development corporations has been prepared to invest strongly in the value chains for biomass conversion. There is a range of reasons for this, not least of which is the hesitance to invest beyond the ‘farm’ gate in R&D and a difficulty in determining how their major stakeholders can capture value downstream in the subsequent value chain.

The departments of agriculture in the Victoria, NSW and Western Australia have research programs on a variety of approaches with the major emphasis being sustainable land use management. The Victorian Department of Primary Industry has a large-scale program of research in to biomass development. Particular emphasis has been given to the partnership with Dow Agrosciences to deliver novel varieties and crops or pastures with specific attributes for subsequent processing. A key emphasis with sections CSIRO has been on the development of novel products through the joint Crop Biofactories program with GRDC and research in to novel oils. In all three States research on the use of short rotation mallee as a bioenergy crop is is being undertaken. The Australian Plant Functional Genomics Centre, jointly funded by the SA government, GRDC and the Australian Research Council has ongoing research into plant traits of interest for drought resistance, salt tolerance and nutrient deficiency. There are also ARC Centres of Excellence focussing on potential new plants and plant products. The flow-on benefits could be increased availability of marginal lands for biomass production.

Though it is not the focus of this report research in SA has been focused on the utilisation of algae for biofuels and bioproducts.

The Rural Industries Research Corporation (RIRDC) has focused mostly on aiding development of temperate biomass through the sponsorship of a range of research reports and workshops. These have provided an informed basis for further work however little actual laboratory or pilot-scale work has been supported by RIRDC.

There continues to be a strong emphasis on development of novel products and plants to deliver inputs for biomass transformation. CSIRO, Victorian DPI, SARDI, University of Queensland and WA Department of Agriculture continue to invest in the potential development of genetic modification of plants, algae and other unicellular organisms. The ability to deliver these modified organisms into Australia agricultural and other production systems is open to question given both the public perceptions around the release of GMOs, intellectual property constraints and perceived market size versus the risks.

Dow, Dupont and to a lesser extent other multinational companies have made investments in R&D in Australia on GMOs. Non-GMO based solutions, such as Microbiogen’s molecular evolution of yeast has also received significant government funding. They have linked up with the USA pre-treatment company PureVision Inc. to examine the applicability of Microbiogen’s technology to various substrates.

CSIRO Joint Venture Agroforestry Program²⁰⁷ had a range of projects in relation to the use and development of novel chemicals from lignin (2005). There is no indication as to what, if any research outputs were produced or whether these were available for commercialisation.

2. Transportation and Logistics

Given the critical nature of the role of logistics, relatively little research work has been undertaken in this part of the value chain, especially in the Australian context. Transport operators could gain considerably from participation in the supply chain. However, the development of infrastructure for intermodal connections for road, rail and ports is critical to achieve the added value.

3. Pre-treatment

Research being undertaken at the Queensland based Centre for Tropical Crops and Biocommodities has been considering the application the application of ionic fluids to pre-treatment of biomass. Work along similar lines is being undertaken at University of Sydney within Chemistry and Chemical Engineering groups²⁰⁸.

Microbiogen’s partnership with the Colarado based PureVison Inc. is intended to optimise both company’s processes, Microbiogen’s organisms and PureVision’s pre-treatment methods. Although Deakin University and CSIRO approached PureVision to transfer its technology to Australia in 2009, funding restrictions in Australia prevented the development.

4. Biochemical and/or thermo-chemical processing

The University of Sydney group, with the support of the GRDC and others has been examining opportunities to deliver novel products from biomass in batch and continuous flow reactors. University of Technology in Queensland, which is closely linked to the Mackay Pilot plant have research underway into transgenic methodologies for conversion of sugarcane to bioethanol. Work on Zymomonas mobilis, as a fermentation organism, is being undertaken at the University of NSW. Research into utilising marine uni-cellular organisms to produce fermentation products, is being undertaken at Deakin University.

Monash University and Melbourne University have small research programs looking at pyrolysis methodologies for delivering biobased chemicals and biofuels. The Renewable Oil Corporation in association with Enecon, is developing a pilot-scale plant based on the Dynamotive Energy Systems technologies from Canada²⁰⁹

There is considerable interest and investment in the application of synthetic biology to production of biobased chemicals. The research at University of Queensland has attracted major international collaborations and investment to the program. Research on metabolic engineering to produce novel products from cells focussed particularly on PHAs in sugarcane is underway.

CSIRO within its flagship programs and bioproducts research themes is undertaking R&D into novel products and enzymes and processes. However, these appear to lack sufficient scale or investment at this time to have a significant impact on either the national or international scene.

5. Product development and Delivery

It is likely that some Australian chemical manufacturers are utilising biobased products in their processes. The most notable example is Plantic, a packaging supplier for the confectionary and baked foods industry utilising corn starch. Plastral , Ecofibre, Dzolv, Signum and Biopak are still operating using bioplastics or biodegradable products in packaging from imported materials.²¹⁰

The Australian Paper and Pulp Institute at Monash University has a range of programs and a relatively small team focussed on a range of products and processes to develop new products and markets from bio-resources. Though there is interest from Dupont to establish a Serona base product plant in Australia the development of a large-scale Australian processing facility is still some years away.

The research and development programs within Australia are diverse and for some niches are even world class. However, only one or two have sufficient scale to drive commercial development or to add significantly to the body of international output. There are opportunities available to link in with international programs, at a buy-in cost of co-investment in Australia. The lack of coordination across the value chain presents both a challenge and an opportunity to address the future R&D for bioproducts and biorefineries. The impetus for change as the world demands greater fuel security, greater food production and urgent action on addressing the perils of climate change require concerted action across the R&D sectors.

The recent proposals from the Paper and Pulp review suggest that there could be significant opportunities to work with the Pulp and Paper Innovation Council on the development of a Biorefinery Institute. The clear message from this report and others is the need for an across value chain approach and for an across agricultural/forestry sector coordinated R&D program that is linked to international efforts. It is only by making bioproducts Research and Development a key priority that Australian industry will remain competitive into the future.

The close linkage between the biomass transformation and the potential development or resurgence in the Australian chemicals industry is self evident. How this will be achieved and whether Australia can capture the opportunity to participate is less evident? Recent experiences in undertaking technology mapping exercises, such as in the automotive industry suggest that a similar exercise may be useful for the chemical industry in Australia. The chemical industry employs more people and represents a significant part of the manufacturing sector which is currently dependent on increasing imports of increasing expensive products. The value to be gained from such an analysis can only be achieved by moving to an implementation strategy with government and industry support.

The pharmaceutical based biotechnology industry growth in Australia (excluding CSL) has been driven from a strong bio-medical R&D sector linked to a growing SME to mid-range companies that have taken opportunities to work with multi-nationals and at various points in the global value chains. Relying on multi-nationals to develop a biomass transformation industry in Australia is not likely to be successful.

Key Messages:

Direct chemical market was US$1.2T in 2005 and growing at 3-6% p.a. compound. Global shipments in chemicals were worth US$3.7T in 2009.

Biobased chemicals are expected to represent 22% of the chemicals market by 2025. Total technical substitution potential by biobased plastics and fibres is 90% of the current total consumption.

Several niche markets and commodity markets are available for biobased products from biorefineries.

There are Australian companies selling biobased products into the marketplace, albeit on a small scale.

The value-add from existing biomass transformation in biorefineries can be up to 5 times the input costs.

Australia’s research and development lags significantly behind overseas activities. All aspects of the value chain warrant addition research to provide efficiency gains and new products and processes.

Interaction with and development alongside an Australian chemicals industry will be essential for the development of biobased products. Linking the plastics and chemicals industry into a technology road-mapping exercise could provide a useful impetus to the development of the Australian chemicals industry based on renewable biomass resources.