Report on Second Generation Biofuels

The International Energy Agency has produced a report which examines second generation biofuel technologies produced from crop and forest residues and from non-food energy crops.

Produced jointly with IEA Bioenergy, the report examines the current state of play and the challenges for 2nd-generation biofuel technologies, evaluates their costs, and considers policies to support their development and deployment.

In summary, the report concludes that it is increasingly understood that 1st–generation biofuels (produced primarily from food crops such as grains, sugar beet and oil seeds) are limited in their ability to achieve targets for oil-product substitution, climate change mitigation, and economic growth. Their sustainable production is under review, as is the possibility of creating undue competition for land and water used for food and fibre production. A possible exception that appears to meet many of the acceptable criteria is ethanol produced from sugar cane.

The cumulative impacts of these concerns have increased the interest in developing biofuels produced from non-food biomass. Feedstocks from ligno-cellulosic materials include cereal straw, bagasse, forest residues, and purpose-grown energy crops such as vegetative grasses and short rotation forests. These

“2nd-generation biofuels” could avoid many of the concerns facing 1st-generation biofuels and potentially offer greater cost reduction potential in the longer term.

This report looks at the technical challenges facing 2nd-generation biofuels, evaluates their costs and examines related current policies to support their development and deployment. The potential for production of more advanced biofuels is also discussed. Although significant progress continues to be made

to overcome the technical and economic challenges, 2nd-generation biofuels still face major constraints to their commercial deployment. Policy recommendations are given as to how these constraints might best be overcome in the future.

The key messages arising from the study are as follows:

• Technical barriers remain for 2nd-generation biofuel production.

• Production costs are uncertain and vary with the feedstock available, but are currently thought to be around USD 0.80 – 1.00/litre of gasoline equivalent.

• There is no clear candidate for “best technology pathway” between the competing biochemical and thermo-chemical routes. The development and monitoring of several large-scale demonstration projects is essential to provide accurate comparative data.

• Even at high oil prices, 2nd-generation biofuels will probably not become fully commercial nor enter the market for several years to come without significant additional government support.

• Considerably more investment in research, development, demonstration and deployment (RDD&D) is needed to ensure that future production of the various biomass feedstocks can be undertaken sustainably and that the preferred conversion technologies, including those more advanced but only at the R&D stage, are identified and proven to be viable.

• Once proven, there will be a steady transition from 1st- to 2nd-generation biofuels (with the exception of sugarcane ethanol that will continue to be produced sustainably in several countries).

“From 1st- to 2nd- generation Biofuel Technologies – an overview of

current industry and RD&D activities” is available as a free download from

or the extended summary from