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Volkswagen becomes shareholder in biofuel company

Volkswagen and Daimler AG have each acquired a minority shareholding in biofuel company CHOREN Industries. The main goal of the commitment by the two companies is the widespread market introduction of BTL (biomass to liquid), a climate-friendly second-generation synthetic fuel.

The shareholdings in CHOREN acquired by the two companies are an important step towards the systematic use of second-generation biofuels and support the further project development of world scale BTL production plants: with a planned annual production capacity of some 200,000 tonnes, such plants represent a milestone for the envisaged widespread market introduction.

CHOREN is currently building the world’s first commercial industrial scale BTL plant at its Freiberg site. From 2008, the plant is expected to produce approximately 15,000 tonnes of fuel a year. This would be sufficient to meet the annual requirements of 15,000 cars. CHOREN also plans to build a plant in Germany with an annual capacity of 200,000 tonnes. Such plants have the potential to contribute significantly towards realizing the German government’s climate protection targets. 10 to 15 CHOREN BTL plants could save up to 3 million tonnes of CO2 by 2020.

Dr. Wolfgang Steiger, Head of Group Research, Powertrains, says that Volkswagen has been calling for and supporting the development and industrial production of second-generation biofuels, known as SunFuels, for a long time. “Compared with the first generation, these second-generation biofuels can in fact as much as triple hectare yields, they do not compete with food production and they help to reduce greenhouse gases by approximately 90%.

BTL is an ultrapure fuel, virtually free of sulphur and aromatics which combusts with extremely low emissions and has an excellent CO2 balance. BTL is produced from various
types of biogenic feedstock and residue, and thus hardly competes with food and fodder production. No adjustment of existing fuel infrastructure is necessary for the distribution and storage of BTL. In addition, BTL is compatible with current as well as future diesel engine technology.

Volkswagen has been supporting the socially, ecologically and economically-compatible cultivation of organic resources for the production of second-generation biofuels. The company wants to see taxation on biofuels oriented to both CO2 efficiency and sustainability criteria such as the use of fertilizers or pesticides, the protection of rainforests, social standards and employment potential.