Scania, the Sweden-headed engine, bus and truck manufacturer, and Lantmännen Agroetanol, Sweden’s largest ethanol producer, have teamed up in a multi-year initiative to establish ED95 as a readily accessible renewable biofuel. Called the “Etha project”, the launch of the initiative was in conjunction with Scania delivering 17 new trucks with its new Euro 6 engine configured for ED95 to Swedish dairy major Arla in Kallhäll, north of Stockholm.
Bioenergy international was present at the handover and spoke with some of the leading players working to revive and grow ED95 as a renewable fuel alternative in the heavy-duty vehicle (HDV) sector.
Jennie Edvardsson, project manager for Etha project, explained what it is about and what is happening right now.
– Ethanol is an interesting fuel, among other things because it is the world’s largest biofuel and with Lantmännen Agroetanol’s ethanol, greenhouse gas (GHG) emissions are reduced by up to 90 percent and it is also an easy fuel to handle. The player who wants to become fossil-free is wise not rely on just one renewable fuel. It is good that biodiesel, HVO, biogas and ethanol are all available, we need them all.
Five-year project
The Etha project is a five-year project. The basis is that anyone who buys a Scania truck that runs on ED95 will get an offer that is cost-neutral in relation to the running costs of a fossil diesel alternative and is valid for the fuel and truck for five years. The deal is a ready packaged by Scania and Lantmännen Agroetanol. The only additional cost is the installation of an ED95 refuelling station and service.
– But that is a marginal additional cost, said Jennie Edvardsson.
300 truck target
– Our plan in the Etha-project is to sell 300 trucks in Sweden within five years. We see that there are obstacles, the lack of infrastructure being the main one, which we address with this packaged deal strategy. The overall goal is to establish a refuelling and fuel distribution infrastructure for ED95 and a sufficiently large vehicle fleet, said Edvardsson.
– The experience thus far is that many do not even know that ED95 is available as an option. This means that many fleet operators, hauliers and transport buyers have a longer decision process. Ethanol has almost disappeared for cars and many do not realize that there are ethanol trucks. We must begin by informing that we actually have ethanol for trucks, she said.
Time for a boost
Carl von Schantz, interim CEO for Lantmännen Agroetanol, means that it is time for a revival of ED95.
– The domestic market for ED95 has been pretty stagnant for many years. It is mainly buses in Stockholm has been the major users. These buses are getting on in years and therefore the use of ED95 has decreased. Our idea is that we, together with Scania and the new Euro 6 engine, will be a boost for ED95. We see that if Sweden is going to achieve its goal to be fossil-free, we need to do something about heavy goods traffic. There is room for all renewable fuels, we are competing solely with fossil diesel, said Carl von Schantz.
Difference between ethanol and ethanol
According to von Schantz, Lantmännen Agroetanol competes on the ethanol market with high sustainability. The climate benefit of ethanol is very much affected by how the fuel is produced.
– Ethanol produced in Europe has on average GHG savings of around 55 percent whereas ours has up 95 percent. We use no fossil energy in our process, we utilise the carbon dioxide (CO2) produced during ethanol production and we use some residues from bakeries as feedstock, therefore, we can achieve up to 95 percent reduction compared to fossil diesel, explained Carl von Schantz.
New option
For many years, ED95 was a patent protected product with only one supplier.
– Now that the patent has expired we have gotten ourselves involved in the production of ED95 and we can supply large volumes. This gives ED95 a new opportunity to grow in the market, said Carl von Schantz.
Towards high-GHG reduction benefits
Currently, Agroetanol exports a significant volume of its “climate-smart” ethanol to Germany as the market pays more the higher the climate benefits are.
– We should also have steering instruments that favour climate benefit ahead of volume. Right now, we sell a lot of ethanol to Germany, because they value the climate benefits higher than we do in Sweden. We get paid on how high the climate benefit is and not just per litre, said Carl von Schantz. The higher price of exported ethanol is also one of the reasons that Agroetanol made a profit in 2015 and 2016 also looks to be good. Other contributing factors are that the company refines more of its ethanol into products like ED95, sells the carbon dioxide as co-product and the use of cheaper feedstock such as food waste.
New engine first step
The trucks that Scania has delivered to Arla are equipped with a new generation engine for ED95. It is a nine-litre 280 horsepower (hp) engine suitable for local distribution and light commercial haulage. Johan Karlsson, Sales Manager, Scania Sweden, spoke about Scania’s role in efforts to establish ED95 as an available renewable fuel.
– The new engine is the first step in our ethanol engine programmes in the Euro-6. It makes sense to start with the smaller engines that have a relatively short radius of action, to build an infrastructure around the vehicles, filling stations and fuel supply. It is to build the infrastructure that we have chosen to partner with Lantmännen Agroetanol. Instead of sitting alone wondering if it’s worth investing or not we cooperate, explained Johan Karlsson.
Largest delivery
The order from Arla for 17 trucks with the new engine is the largest ever for Scania.
– Arla is a very valued customer because they do not just choose one option; they work with the entire palette of renewable fuels. We have a close cooperation and are actively working with the tools we have in our portfolio, which can help to lower emissions of carbon dioxide in Arla’s transport, said Johan Karlsson. The economic motivation for ED95 varies from customer to customer.
– Our trucks are only one tool in the logistics chain, which means that motivations shift. The common driving force in the industry right now is to reduce carbon emissions. The additional cost for an ED95 solution is negligible, but you have to sit down and calculate on each case, concluded Johan Karlsson.
Several legs to stand on
Berne Carlsson is responsible for the vehicle fleet at Arla.
– Regarding the choice of biofuels we have learned from past experiences. We went in hard into RME in 2013 and 2014. Then came a sudden tax decision that raised the price. Luckily HVO was available on the market and we could continue with renewable fuels, but we learned the importance of having more legs to stand on, said Berne Carlsson.
More than 80 percent fossil free
In Sweden, over 80 percent of Arla’s transport is fuelled using renewables fuel. At the three largest terminals; Kallhäll, Jönköping and Göteborg, all vehicles run on renewable fuels.
– We have no fossil diesel at these terminals, instead it’s HVO, RME and in Kallhäll we now also ethanol, ED95. RME and HVO have not given us higher costs over time it is a zero-sum game. Ethanol is a bit more expensive in operation right now, but we look at it as an investment in sustainability capital. We’ll see how the cost of ethanol will look in a few years, ended Berne Carlson.
Facts
About ED95
ED95 is a blend of 95% ethanol and 5% ignition improver that was developed by Swedish ethanol producer SEKAB, that still produces the fuel. It is used in modified diesel engines with higher compression ratio and an adapted fuel system. Stockholm city buses began using ED95 already in 1985 and by 2010 had the world’s largest fleet running on ED95. Several cities in Europe and Brazil have buses running on ED95.
