GLOBAL BIOFUEL INVESTMENTS AND OUTLOOK · GLOBAL BIOFUEL INVESTMENTS AND OUTLOOK ... Other=electric...

BNEF BIOENERGY BRIEFING, March 2014 1 / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / /

GLOBAL BIOFUEL INVESTMENTS AND OUTLOOK

BERKELEY BIOECONOMY CONFERENCE

MARCH 2014

SALIM MORSY

BNEF BIOENERGY BRIEFING, March 2014 2 / / / /

FIRST GEN CONTENT

1. About Bloomberg New Energy Finance

2. First and next-gen biofuel investments

3. Brazil ethanol market outlook

3. Low Carbon Fuel Standard outlook


ABOUT BLOOMBERG NEW ENERGY FINANCE

San Francisco New York

Washington DC

São Paulo Cape Town Sydney

Hong Kong New Delhi

London Beijing

Tokyo

200 staff in 13 offices worldwide Objective: serve clients with the best intelligence on finance, technology and policy developments

in clean energy, energy efficiency and carbon markets

Zurich

Singapore


WHO WE SERVE: 700+ LEADING PLAYERS GLOBALLY

GOVERNMENT & AGENCIES SUPPLY CHAIN &TECHNOLOGY

UTILITIES & ENERGY FINANCE & INVESTMENT


FIRST GEN CONTENT






ASSET FINANCE BY REGION, 2004-2013 ($BN)

Bloomberg New Energy Finance Note: all investments are new build asset finance projects. AMER: North and South America. EMEA: Europe, Middle East and Africa, ASOC: Asia Oceania


VC/PE INVESTMENT, 2004-2013 ($M)

Source: Bloomberg New Energy Finance

FIRST-GENERATION VS. NEXT-GENERATION BY REGION


TOTAL IOC BIOFUEL INVESTMENT BY COMPANY, 2005–2012 ($M)

Source: Bloomberg New Energy Finance Notes: Exxon's investment figure represents 1/6 of its 2009 announcement to commit $600m to biofuels as the company publicly recognized this figure in May 2013.


IOC NEXT-GENERATION BIOFUEL INVESTMENTS BY TECHNOLOGY, 2005–2012 ($M)


Note: "R&D" represents BP's investment in the Energy Biosciences Institute in California, which focuses on a wide range of bioenergy research programmes including plant science, biomass depolymerisation, fermentation processes and environmental impact research. We also believe the BP investment in its biobutanol fermentation technology is significantly higher than the figure we are able to record here as there are limited public figures quantifying its involvement.


FIRST GEN CONTENT






LCFS COMPLIANCE SCHEDULE 2011 – 2020 (GCO2E/MJ)

Source: Bloomberg New Energy Finance, CARB,


REGISTERED PRODUCTION CAPACITY UNDER THE LCFS, 2013 (BN GALLONS)

Source: Bloomberg New Energy Finance, CARB


CI VALUES: RANGE OF REGISTERED FUELS IN THE LCFS AND WEIGHTED AVERAGES BASED ON SUPPLY, 2014 (GCO2E / MJ)

Source: Bloomberg New Energy Finance, CARB Note: CI’ stands for carbon intensity. Weighted averages refer to the weighted average of the CI values of the various biofuels, based on their total volume registered with CARB.


SOURCES OF NET CARBON CREDIT GENERATION UNDER THE LCFS, 2011–2013 (TONNES OF CO2)

Source: Bloomberg New Energy Finance, CARB Notes: Other=electric vehicles, compressed natural gas, liquefied natural gas.


LCFS CREDIT PRICES, SEPTEMBER 2013 – FEBRUARY 2014 ($ PER CREDIT)

Source: Bloomberg New Energy Finance, CARB Note: Q3 and Q4 2013 prices are estimates.


BNEF LCFS COMPLIANCE CALCULATOR

Source: Bloomberg New Energy Finance Note: Corn ethanol CI: 82, Sugarcane ethanol CI: 58, Biodiesel CI: 4, Renewable Diesel CI: 33. Biomass-based diesel blend rate: 3%


PROJECTED CALIFORNIA DIESEL DEMAND AND SOURCES OF DISPLACEMENT (BASE CASE), 2014-20 (BN GALLONS)


Note: All volumes are expressed in diesel gallon equivalents (DGE). Volumes of displacement are measured relative to the demand for gasoline and diesel that would have occurred had the drivers of displacement not existed at all.


PROJECTED CALIFORNIA GASOLINE DEMAND AND SOURCES OF DISPLACEMENT (BASE CASE), 2014-20 (BN GALLONS)


Note: All volumes are expressed in gasoline gallon equivalents (GGE). Volumes of displacement are measured relative to the demand for gasoline and diesel that would have occurred had the drivers of displacement not existed at all.


PROJECTED DEMAND IN CALIFORNIA FOR ETHANOL, 2014-20 (BN GALLONS)



PROJECTED CALIFORNIA BLENDED BIOFUEL MIX, 2014 (BN GALLONS)



FIRST GEN CONTENT






QUARTERLY BRAZILIAN NEW ETHANOL INVESTMENTS, Q1 2009 – Q4 2013 ($ BN)

Source: Bloomberg New Energy Finance Notes: VC/PE stands for “Venture capital / Private equity”


FINANCED NEXT-GENERATION BIOFUEL PROJECTS IN BRAZIL

Source: Bloomberg New Energy Finance .


RAÍZEN’S CORPORATE STRUCTURE AND TECHNOLOGY PARTNERS FOR THE COSTA PINTO CELLULOSIC ETHANOL PLANT

Source: Bloomberg New Energy Finance .


COSTA PINTO CELLULOSIC ETHANOL PLANT PROJECT RETURNS, 2014

Source: Bloomberg New Energy Finance. Notes: we assume total revenue per litre of $0.69 including bioelectricity generation from lignin. Other assumptions include a feedstock cost of $30 per dry tonne of bagasse, a load factor of 80% and an asset lifetime of 20 years. We base anhydrous revenue prices on the five year average CEPEA price. Debt to equity is 90:10 with a cost of debt of 3.5% and a cost of equity of 12.9%.

BNDES COSTS OF CAPITAL MARKET COSTS OF CAPITAL


BRAZIL ETHANOL PRODUCTION CAPACITY AND PLANNED EXPANSIONS, 2012–2021 (BN GALLONS)

Source: Bloomberg New Energy Finance, ANP, Petrobras Notes: We assume all new ethanol production capacity will be anhydrous.


BRAZIL PETROLEUM PRODUCTS REFINING CAPACITY, 2012–2021 (BN GALLONS)

Source: Bloomberg New Energy Finance, ANP, Petrobras

Notes: We do not include the installed capacity for aviation gasoline, heating fuel, lubricants, paraffins and solvents. We include the output of the Premium 1 second module that Petrobras is planning on building although no firm commissioning date is set. Gasoline capacity includes all napthta hydrocracking and catalytic reforming capacity.


BASE CASE BRAZIL LIGHT VEHICLE FUEL DEMAND AND SOURCES OF SUPPLY, 2012–2021 (EXAJOULES)

Source: Bloomberg New Energy Finance, EPE, ANP

Notes: Domestic gasoline supply capacity is based on announced gasoline cracking expansions at Petrobras refineries as well as announced new refineries. Ethanol supply is based on the BNEF database of announced sugarcane greenfields and expansions through 2015. We base fuel demand on the Brazil government's projection of vehicle sales in Brazil. In addition, we assume the total vehicle fleet gains 0.2% of fuel efficiency on a yearly basis.


COPYRIGHT AND DISCLAIMER

This publication is the copyright of Bloomberg New Energy Finance. No portion of this document may be

photocopied, reproduced, scanned into an electronic system or transmitted, forwarded or distributed in any

way without prior consent of Bloomberg New Energy Finance.

The information contained in this publication is derived from carefully selected sources we believe are

reasonable. We do not guarantee its accuracy or completeness and nothing in this document shall be

construed to be a representation of such a guarantee. Any opinions expressed reflect the current judgment of

the author of the relevant article or features, and does not necessarily reflect the opinion of Bloomberg New

Energy Finance, Bloomberg Finance L.P., Bloomberg L.P. or any of their affiliates ("Bloomberg"). The

opinions presented are subject to change without notice. Bloomberg accepts no responsibility for any liability

arising from use of this document or its contents. Nothing herein shall constitute or be construed as an offering

of financial instruments, or as investment advice or recommendations by Bloomberg of an investment strategy

or whether or not to "buy," "sell" or "hold" an investment.

/ / / / / / / / / / / / / / / / / / / / / / / / / / / /

Subscription-based news, data and analysis to support your

decisions in clean energy, power and water and the carbon markets

[email protected]

MARKETS Renewable Energy Carbon Markets Energy Smart Technologies Renewable Energy Certificates Carbon Capture & Storage Power Water Nuclear

SERVICES

Insight: research, analysis & forecasting Industry Intelligence: data & analytics News & Briefing: daily, weekly & monthly

Applied Research: custom research & data mining Knowledge Services: Summit, Leadership Forums, Executive Briefings & workshops

GLOBAL BIOFUEL INVESTMENTS AND OUTLOOK SALIM MORSY [email protected]

GLOBAL BIOFUEL INVESTMENTS AND OUTLOOK · GLOBAL BIOFUEL INVESTMENTS AND OUTLOOK ... Other=electric...

Documents

Transcript of GLOBAL BIOFUEL INVESTMENTS AND OUTLOOK · GLOBAL BIOFUEL INVESTMENTS AND OUTLOOK ... Other=electric...