A Study on Production of Anhydrous Fuel Ethanol in Lithuania

Global Environment Centre Foundation(GEC)

Reports of CDM/JI Feasibility Studies

Title of the researchA Study on Production of Anhydrous Fuel Ethanol in Lithuania
FYFY 2004
Main research organizationMitsui Engineering & Shipbuilding Co., Ltd.
Research partner(s)Kauno NOVA
Location of the projectKaunas, Lithuania
Summary of the research report (PDF)Summary(137kb)
Description of the projectIn this project, anhydrous biomass ethanol is produced mainly from wheat as raw material and with relatively low energy consumption. Agricultural product waste is also utilized. The product ethanol is to be distributed to the domestic market as well as the EU market as the fuel of gasoline substitute. A company for ethanol production and sales, newly established in Kaunas City, constructs ethanol production plant in the City. Reduction of energy consumption in the process is attempted by combining efficient ethanol fermentation and membrane dehydration. The supply of raw material grain for this project is secured by contracting for a long-term basis with suppliers.
    • Raw materials: Principally grain procured at peripheral area of the ethanol production plant

    • Raw material feed rate: 1,320 tons/day

    • Product: Anhydrous ethanol for fuel (99.8 Wt%)

    • Production capacity: Annual output 160,000 kℓ

    • Plant availability: 335 days / year

    By-product: Fermentation residue is sold as fodder for animals. Gluten is sold as food or fodder additive.
Sector of the projectBiomass Utilisation
Duration of the project activity/ crediting period2007 to 2021
Baseline methodology/additionality(1) Baseline setting
In presumption of baseline scenario, (b) approach in paragraph 48 of Modalities and Procedures for CDM was applied.
Based on hypotheses, out of plural scenario which are thought to be possible, the following scenario was selected as the most plausible:
The new construction of a fuel ethanol production plant does not take place from economic rational viewpoint. Instead conversion of the existing potable ethanol production facilities into fuel ethanol production by newly adding dehydration equipment is more likely to occur. Because the production capacities of these existing facilities are relatively small, fuel ethanol production volume as a whole hardly increases. As a result, fuel ethanol production volume is far less than the demand volume.
The situation is similar to those in other EU countries.

(2) Proof of additionality
With the project scenario a fuel ethanol production plant is newly founded in Lithuania. With full operation of the plant, the amount of anhydrous ethanol to meet the expected demand when ethanol blended gasoline is introduced in Lithuania can be domestically supplied. With this scenario, plant investment cost is markedly large in comparison with the baseline scenario and therefore project IRR is much lower than the baseline scenario, indicating that the choice of constructing a new production plant cannot be economically attractive activity. Therefore it is not a BAU scenario. In addition, because all the anhydrous bio-ethanol produced by the production plant is assumed to be used as automobile fuel, the difference between the quantity of GHG emission that corresponds to the consumption of gasoline based on the baseline scenario and the quantity of actual GHG emitted through implementation of the project is the reduction quantity. Because the difference is supposed to be positive, the additionality is proved.
Estimation of GHG emissionsThe GHG emission quantity for both baseline scenario and project scenario were calculated. The result shows that annual emission reduction of approximately 130,000 tons of CO2 equivalent would be achievable with execution of this project. As for leakage, because it is presumable in this case that there would be no significant difference in the quantity of greenhouse effect gas discharge outside the project boundary, the leakage due to this project is assumed to be zero.
Monitoring methodologyPrincipal measurement items are as follows:
○Keeping records of the quantity of raw materials, secondary raw materials etc., which are accepted at the bio ethanol factory, stored in the facility and used in operation, by computer or by writing.
○Keeping records of the production volume of produced anhydrous bio-ethanol by computer or writing.
○Keeping records of the sales volume of produced bio-ethanol by computer or writing.(because anhydrous bio-ethanol is denaturalized, it is not used other than for automobile fuel.)
○Keeping records of the quantity of the fossil fuel used on the occasion of unscheduled stop, startup and shutdown of the plant.
Environmental impactConcerning the implementation of environmental impact assessment, it is stipulated with law that the implementation is obligatory for those that are regarded to have large impact on the environment. Accordingly to the stipulation, the project is likely to be the case.
Issues and tasks for project implementationThe results of business profitability calculation conducted are as shown in the figure below. The PIRRs are at 10th year after starting the business. The impact of ERU is small under the conditions employed.