Coal and gas rate top future liquid fuel sources

By: Rob McKay

Report says developments over the next six years will make alternatives to petroleum-based fuels economically attractive.

Coal and gas rate top future liquid fuel sources
Alternative sources of liquid fuel are developing quickly.


The next generation of transporters can expect to deal with a wider choice of liquid fuel sources, according to this year’s Australian Liquid Fuels Technology Assessment (ALFTA) report.

It is expected that developments over the next six years will make alternatives to petroleum-based fuels economically attractive to produce in this country.

"By 2020, multiple emerging technologies are expected to be available at a lower LCOF [levelised cost of fuel] than petroleum fuels," the report’s findings state.

Of 18 liquid fuel production technologies examined, fuel sourced from coal and gas, though non-renewable, look the most likely options in the medium to longer term.

"Natural gas and coal-derived fuels technologies offer the lowest LCOF over most of the projection period and they remain cost competitive with the lower cost renewable technologies out to 2050, if carbon pricing or cost of carbon capture is not included in the LCOF estimates," the report finds.

From the Bureau of Resources and Energy Economics (BREE) and supported by research by engineering consultancy WorleyParsons, ALFTA 2014 is the Federal Government’s liquid fuels costs estimates document.

It provides current and projected technical viability, feedstock and co-product prices and availability, capital costs, operating costs, and barriers to development and implementation of production technologies.

A key comparable cost across technologies, and one of the estimates presented in this report, is the LCOF, which is expressed in real Australian dollars per gigajoule of energy content.

The LCOF is indicative of the price at which liquid fuels must be sold for at the gate of a single plant to break even, taking into account the costs incurred over the life of the plant.

The 2014 ALFTA’s findings note that while several currently available technologies from which fuel production is already competitive with conventional petroleum fuels are available, they are yet to arrive on our shores.

Beyond conventional petroleum fuels and gases, the top options measured by technical and commercial readiness levels and relevance to this country include: conventional bioethanol; biodiesel by transesterification; hydroprocessed esters and fatty acids (HEFA) and hydrotreated vegetable oil (HVO); and methanol to dimethyl ether (DME) or methanol to gasoline (MTG).

The report can be found here.

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