The depletion of fossil fuel sources, the wobbling prices of fuels, and the increased pressure regarding environmental and social aspects have increased the industrial focus towards renewable energy resources such as organic waste [1
]. Organic residues have been considered an inexpensive, renewable, widely available, and environmentally friendly feedstock for biofuels production [10
]. Currently, large quantities of biofuels are generated from first-generation resources, such as starch, corn, and sugar [15
]. Although this is a more efficient way of producing fuel compared to fossil fuel sources, the drawback of using first-generation resources is that these products are part of the food supply. The increased demand for first-generation resources negatively affected the availability of food [20
]. Additionally, first-generation resources require large amounts of fertile land, and most agricultural land is already occupied. Therefore, a better fitting source for the production of biofuels is organic residues since they have no negative impact on food production or land use, resulting in a more sustainable feedstock utilization for the production of bioethanol [25
Lignocellulose is a natural composition consisting of cellulose, hemicellulose, and lignin. The dry weight mainly consists of cellulose, namely 35–50%, a further 20–35% of hemicellulose, and around 10–25% of lignin [29
]. Lignocellulosic waste can come from several sources, namely industrial waste (e.g., recycled newspaper, food industry residues, sawdust), agricultural waste (e.g., bagasse, rice straw, corn stover), forestry waste (e.g., wood chips, grasses, hard and softwood), bioenergy crops (e.g., common reeds, switchgrass), and municipal solid waste [30
]. The lignocellulosic biomass can be converted into bioethanol via a biochemical pathway. Biochemical conversion is based on enzymatic hydrolysis of the biomass into sugars. These sugars are fermented, and after distillery of the fermentation liquid, pure ethanol is obtained.
From the early 2000s to 2012, the biofuel consumption in Europe flattened out after increasing steadily. In 2017, 2718 t of oil equivalents (toe) of bioethanol was consumed for transport in Europe, of which 121 toe was consumed by the Netherlands [33
]. Although much research has been done on the ethanol production from lignocellulosic biomass [34
], the economic viability of a bioethanol plant in the Northern Netherlands is yet unknown. Therefore, this research aims to investigate the feasibility of a bioethanol plant treating organic residues (sugar beet pulp and grass straw) in the Northern Netherlands. In this study, the economic analysis is conducted to evaluate the profitability of the plant based on net present value (NPV) and internal rate of return (IRR). This study provides techno-economic information to a broad audience and can also be used as a baseline study for further business investigations.
3. Results and Discussion
Mapping the operating bioethanol plants in the Netherlands, it was found that none of these feedstocks are used for the production of bioethanol; but most of them are focused on corn stover, a feedstock that contains high amounts of cellulose (43.7%) and hemicellulose (23.7%) [64
]. The investigation of the viability and sustainability of bioethanol plants is required, to give insights into new pathways for boosting the bioeconomy [65
]. There will be more fermentable sugars available that result in higher ethanol production, and thus, revenue.
After simulating the processes in SuperPro Designer, the data in Table 4
were acquired. Here it can be seen that ethanol production from GS yields the highest revenues. This can be a result of the significantly higher dry matter content (92.50%) when compared to SBP (70.36%), or the slightly higher efficiencies of carbohydrate polymer conversion in the GS. Therefore, the plant treating GS will obtain the highest revenue. The executive summary for SBP and GS for the production of bioethanol can be found in Table 4
From Table 4
, it can be concluded that a bioethanol plant that treats SBP is not economically viable since the NPV is negative. The revenue per year is not large enough to cover the total capital investment and the operating costs per year, which results in an NPV of −671,000 €. The high capital costs are due to the building and constructing costs (22.91%) and equipment purchase costs (18.15%), which total of €1,061,000 €. The operation costs mainly consist of utilities (57.78%) which are 621,000 €. The high utility costs mainly result from the high amount of steam required to heat the vessel for 30 min at 121 °C in the pretreatment step. The costs are 328,134 € per year for only V-101, which accounts for 71.62% of the total amount of steam used. Besides, since SBP is not vastly available, 105,000 € per year must be paid to store the SBP to have a constant supply. If it was vastly available, the operating costs would decrease to 970,000 € resulting in a unit production cost of 0.68 €/kg ethanol. In this situation, the IRR is 5.86%, the NPV 207,000 € and the payback time 13.8 years, meaning that it would be economically viable.
As can be seen in Table 4
, a bioethanol plant treating GS is not economically viable. Due to the long cycle time, the batches are larger resulting in a larger fermentation vessel. To process the volume, 3 fermenters are needed, which results in high equipment purchase costs and high direct fixed capital costs. Thus, it is a high capital investment because most of the investments consist of the equipment costs. The equipment purchase costs are 18.45% of the total capital investment. Together, with the engineering and construction costs, which are 22.71% of the total capital investment, they are the largest expenses. Besides high equipment costs, more energy is needed since the equipment used is larger. Furthermore, the utility costs and thus operating costs are higher, since the pretreatment requires heating at 180 °C, and this needs to be done with high-pressure steam instead of regular steam. High-pressure steam costs 18.80 €/MT and normal steam 11.28 €/MT, whereby the costs increase to 434,483 €. Besides the use of high-pressure steam, 4,734,017 metric tons of cooling water are needed to cool the pretreated GS in the fermentation vessel since that process must be executed at 37 °C, which further contributes to the high utility costs (70.71% of the total operating costs). Since the costs are too high compared to the revenue, it is not possible to calculate the IRR nor the payback time.
When comparing the different feedstocks used, it can be concluded that SBP is the most viable. Although the numbers are not positive now, better technology/procedures for storing the SBP could provide a way out. For SBP, this could be a solution; but for GS, the gap is too large. Furthermore, in both cases, the equipment purchase costs, building and construction costs, and utility costs are the highest expenses within the total capital investment. By removing the pretreatment section (units V-101, PM-101, PM-102, and the sulfuric acid (Figure 2
)) from the pretreatment pathway several aspects change. The efficiency of the enzymatic hydrolysis of non-pretreated GS will be lower. In the fermentation, less ethanol will be produced and therefore the revenue becomes smaller. Furthermore, the total capital investment decreases since the equipment purchase costs are lower, which also lowers the direct and indirect plant costs. In addition, since the sulfuric acid is no longer used, the volume of the process decreases; and therefore, the equipment costs and the utility costs decrease. Additionally, the raw material costs and waste handling cost decreases since sulfuric acid is no longer needed or disposed of. Compared with corn stover, SBP and GS contain a lower amount of cellulose and hemicellulose, and therefore the revenue from the ethanol production is not high enough to cover the total capital investment and operating costs which leads to a non-economical viable plant.
Since V-101 required heating to 121/180 °C, a large amount of steam was needed to obtain these temperatures. After that, a large amount of cooling water was required to obtain the right temperature for fermentation. Since this is no longer part of the process, the operation costs are significantly lower. In Table 4
, it can be found that the production of bioethanol from SBP and GS without pretreatment is viable. SBP gives a payback time of 5.09 years, an IRR of 23.05%, and an NPV of 3,367,000 €. GS provides a payback time of 5.85 years, an IRR of 19.30 and an NPV of 2,763,000 €. Comparing SBP with GS, investing in SBP would be advised since the NPV and IRR are higher. The costs that are saved on the equipment and utilities do not weigh up against the loss in revenue. To break even, the selling price of the ethanol for SBP and GS must be 0.68 €/kg and 0.96 €/kg, respectively, which are too high because the ethanol still must be purified.
Analyzing all results, it is found that a plant treating GS produces the highest amount of bioethanol. Although this results in the highest revenue, plants processing GS are not most favorable. Due to the large volumes required, the direct plant costs, indirect plant costs, and operating costs are larger, which results in higher unit production costs. Furthermore, it is found that an ethanol production plant using pretreated SBP or pretreated GS is not viable, since these result in a negative NPV. The content of cellulose and hemicellulose in the biomass is too low, which results in revenue which cannot cover the total capital investment and the operating costs. If the right procedure for storing SBP was available, the plant treating SBP would be viable since the NPV becomes −671,000 €. Furthermore, excluding the pretreatment improved the financial outcome of the cases: the NPV became smaller. Altogether, it is possible to have a viable production process for SBP or GS when the pretreatment section is excluded, or if a suitable storage procedure of SBP is included.