A systematic evaluation of risk in bioenergy supply chains

Abstract

We introduce a novel method of evaluating risks of disruption to (bio)fuel supply chains. The biofuel landscape is complex, with multiple options for feedstocks and processing routes, but the type, size, and scale of risks are currently not sufficiently appreciated. As a consequence, the uptake of biofuels remains below expectation suggesting the need for comprehensive risk assessment. Our method of risk discovery and evaluation is based on a transparent and robust sustainability assessment framework, and exploits the richness of data and expert analysis available in publications. In a UK case study, we show that biomass (solids) has a similar risk score to coal, biogas being slightly less risky, with bioliquids being less risky still though more risky than wind and solar power. The most important cause of risk, ‘changing policy or regulatory framework’, reflects this fledgling industry's need for policy support. The second most important cause of risk is ‘lack of access to capital’, reflecting the scale of the process engineering required to convert biomass to tightly specified products which could substitute fossil fuels. Levels of optimism bias in the biofuel industry are high, leading to unrealistic expectations from complex technologies and dubious claims about the quantity of resource available. This, together with the wide variety and variability of feedstocks complicates the business case for biofuel investment. Bioenergy policy would benefit from a more nuanced understanding of risks which impede the widespread large-scale deployment of biofuels.