Increased crude oil prices coupled with other factors like limited resources, environmental sustainability and political instability have forced many regions in Southeast Asia to search for alternative energy sources. As such, the potential benefits of opting for alternative second generation biofuels in these regions cannot be ruled out.
The Potential Benefits of Second Generation Biofuels
Second Generation Biofuels successfully address all the concerns posed by standard fossil fuels as well as the first generation biofuels. One of the main issues experienced by the latter; scarcity, is easily handled by second generation biofuels which have plenty of resources in the form of feedstock like corn starch, wood fuel, grass and other cellulosic materials.
Since these elements are not a part of the food chain, using them will not create a significant imbalance in the same as well. Environmental sustainability is also easily achieved with lower emissions when compared to fossil fuels. Recent technological advances have also led to overcoming factors like unfavorable economics in regions like Southeast Asiawhich can enjoy significant production afterwards.
The hurdles that need to be crossed
In spite of the potential benefits of biofuels for Southeast Asia’s energy industry, there are certain hurdles that one would need to cross before realizing this dream. These include:
Although experts believe that the production of biofuels would cost only a fraction of crude oil production, the expenses related to feedstock are something one needs to ponder about. While first generation and third generation biofuels can experience limited growth owing to volatile feedstock prices, only second generation fuels can experience a significant growth. But this sector alone would not be able to satisfy the region’s growing demands for energy.
Availability of Feedstock
First generation biofuels need materials off the food chain and can create an imbalance in the same with repeated use. Factors like loss of biodiversity, food supply disruption, soil erosion and increased pressure on water resources to produce this feedstock can hamper fuel production to a great extent.
Moving over to second generation (2G) biofuels would be the best way to address this concern. Second generation biofuels use feedstock that don’t disrupt the food pyramid. Southeast Asia has an abundant supply of the feedstock needed for 2G fuel production. Hence, the region has a great potential to leverage these materials for biofuel production on a large scale.
Challenges related to Supply
Supply chains for feedstock cost up to 50% of the overall feedstock cost itself. The dispersed nature of the feedstock across diverse agricultural areas also makes it difficult to set up a coordinated supply chain management for feedstock related to 2G biofuel production in Southeast Asia.
One would have to either increase the efficiency of the existing supply chain system by defining optimal networks for bio refineries in the region, or find out alternate logistics like transporting feedstock in liquid form to keep the supply chain alive and active for 2G fuel production.
Need for regulatory support
Many governments across Southeast Asia have passed mandates to support biofuel production on a large scale. However, one cannot expect this to take effect until appropriate measures are made to introduce incentive-based policies that are appealing enough for stake holders to show interest in the industry.
The efforts of numerous stakeholders have already yielded fruits in many countries outside the Southeast Asian region, including the U.S. Biofuel production has reached new heights in the U.S. as well as other countries like Brazil which have been taking painstaking efforts to make alternate fuel a mainstay for their energy needs in the near future. By overcoming the hurdles pointed out, the Southeast Asian region can definitely see a revolution of sorts in its energy industry with the introduction of biofuels.
Biofuels are being considered as the best alternate replacement for crude oil in the near future. With proper regulatory support from governments and the hurdles related to feedstock, supply and affordability taken care of, bio fuels can easily revolutionize the energy industry.