Implications for Agriculture, Energy, and Automotive.
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Transcript of Implications for Agriculture, Energy, and Automotive.
Implications for Agriculture, Energy, and Automotive
Copyright © 2006 Global Insight, Inc. 2
The Bio-fuels Boom
Copyright © 2006 Global Insight, Inc. 3
Value Proposition
Providing an Integrated Perspective Agriculture, Transportation, and Energy perspectives
combined – from Field to Wheels.
Identifying the Issues & Answering the Questions in Context Long-standing expertise in competing and
complementary businesses Based on an economic analysis platform
GLOBAL INSIGHT Independent, reliable analysis
Copyright © 2006 Global Insight, Inc. 4
Three Major Policy Drivers…
…Are They Compatible?
Reduce criteria emissions at local, urban, metro, and national levels
Reduce greenhouse gas emissions
Create new markets for agricultural crops
Reduce subsidies
Energy security Reduce dependency
on petroleum-based energy sources
Diversify energy sources
Energy Environment Agriculture
Copyright © 2006 Global Insight, Inc. 5
Strategic Questions Addressed in The Bio-fuels Boom
• What are the global drivers of bio-fuels consumption?
• What role do the major economic powers play in bio-fuels growth? (U.S., NAFTA, EU-25, Asia, Latin America, Africa)
• What is the range of long-term policy objectives? How will they vary from country to country
and at the regional and local levels?
How will policy influence the creation of a commercially viable bio-fuels industry?
Copyright © 2006 Global Insight, Inc. 6
Strategic Questions Addressed in The Bio-fuels Boom
• How is the bio-fuels infrastructure evolving internationally?
• What is the current state of technology and how will it develop?
• What is the tipping point, where bio-fuels will impact the energy, agriculture and automotive markets?
• What are the expectations and limits to growth in the bio-fuels industry?
Copyright © 2006 Global Insight, Inc. 7
Ethanol Production Capacity: Growing Rapidly
- 5.0 10.0 15.0 20.0
United States
Brazil
China
India
France
Russia
Germany
South Africa
Spain
U.K.
Billions of liters per year
2004
2005
Source: F.O. Licht
Copyright © 2006 Global Insight, Inc. 8
A Scenario-based Approach
• The global bio-fuels industry will unfold based on the evolution of several key factors: Government mandates and support Production and process technology in the agricultural, automotive,
and energy industries Cost evolution International trade issues Distribution and infrastructure Global oil prices
• Alternative scenarios of future supplies and prices are a core element of the study
Copyright © 2006 Global Insight, Inc. 9
Proposed Scenarios
Market Re-managed: Supply Growth Keeps
Pace with Demand
Cornucopia: Significant Supply Surplus,
Price Drops
Supply constrained: Production Does Not
Meet Demand
Global Insight will also build scenarios with the charter subscribers to the study.
Copyright © 2006 Global Insight, Inc. 10
Bio-fuels Growth Ranges from 5-to-25% by Scenario
0%
5%
10%
15%
20%
25%
30%
2005 2008 2011 2014 2017 2020 2023 2026 2029
Market Re-managed
Supply Constrained
Cornucopia
To
tal G
lob
al P
etro
leu
m S
up
ply
(%)
Global Insight Petroleum Scenarios
Copyright © 2006 Global Insight, Inc. 11
FUEL TYPES
Study Coverage
FEEDSTOCKS
CORN SUGAR BEETS SWITCH GRASS & WOOD CHIPS(NEXT GENERATION FUELS)
SUGAR CANE SOYBEANS CROP RESIDUES (NEXT GENERATION FUELS)
WHEAT & BARLEY RAPESEED, JATROPHA OIL & PALM OIL (BIO-DIESEL)
OTHER NON-CONVENTIONAL SOURCES (E.G., ALGAE, FARM & MUNICIPAL WASTES)
(Study does not include alternative fuels such as LPG, LNG, CNG, hydrogen, gas-to- liquids, or coal-to-liquids)
NEXT GENERATION BIO-FUELSBIO-DIESEL
BIO-ETHANOL
Copyright © 2006 Global Insight, Inc. 12
Final Report: Proposed Table of Contents
• Executive Summary
• Description of ScenariosKey components of scenariosMajor uncertaintiesSummary of scenario storiesSignposts
• Major Government Bio-fuels Programs and Policies Incentives, targets, restraints
• U.S.• Europe (by country)• Africa
• Bio-fuels Consumption ForecastsBy bio-fuel type By scenarioBy major consumption countryTrade flowsTo year 2030
• Bio-fuels Production ForecastsBy bio-fuel typeBy scenarioBy major production country/region
• Automotive Sector ResponseTechnologyStrategies of each of 10 major OEMsComponent sourcing
• Agricultural Sector ResponseStrategies for the Agricultural SectorMarketingMajor stakeholder responses
• Energy Sector ResponseMarkets for bio-fuels in energy sectorStrategies for the Energy SectorMarketingMajor stakeholder responses
• Conclusions and Recommendations
• Appendices Detailed data tables provided electronically
• Asia (by major country)• Latin America
Copyright © 2006 Global Insight, Inc. 13
Bio-fuels and the Automotive Industry
Bio-fuels Automotive Technology
Strategies for the 10 Major OEMs
• How are the on-vehicle systems impacted by each fuel? (e.g., storage, delivery, energy management)
• What technical solutions are needed and at what cost?
Product Offerings Marketing
• Which Vehicles?
• What Fuels?
• Are alternative fuels a strategic initiative?
• …OR a “must do” to be competitive?
Corporate Positioning Component Sourcing
• Wrap itself in green?
• Take the role of a responsible corporate citizen?
• View alternative fuels as an extension of product lines necessary to remain competitive?
• In-house technology development or outsource the expertise?
• In-house or outsource component production?
Copyright © 2006 Global Insight, Inc. 14
Bio-fuels and the Agricultural Industry
Bio-fuels Production Technologies
Strategies for the Agricultural Sector
• Major Feedstock Technologies Grain fermentation advancements Cellulosic ethanol
• Production Cost Estimates• Energy and Carbon Balances
• Government policies for use of agricultural surpluses• Land use management for food and energy production
• Current and future subsidization programs• Competition with food production and prices
Marketing Stakeholder Response
• What is the potential market for crops to produce bio-fuels? (by country & by U.S. state)
• How will this affect the agricultural industry?
• Large agricultural companies
• Farm co-ops
• Emerging bio-fuels companies
• Transportation – pipelines, trucks, ports
• Investors
Copyright © 2006 Global Insight, Inc. 15
Bio-fuels and the Energy Industry
Bio-fuels Markets in the Energy Sector
Strategies for the Energy Sector
• Fuel for electric power generation
• Substitute for distillates and home heating oil
• Blending agents for gasoline and diesel pool
• Government energy security policies• Government environmental policies• Product quality regulations• Taxes and import/export tariffs• Targets and mandates
Marketing Stakeholder Response
• What is the potential market for bio-fuels? (by country/region and within the U.S. by region)
• Large integrated energy companies
• Refiners
• Pipelines and retailers
• New business entities
• Investors
Copyright © 2006 Global Insight, Inc. 16
Who Should Participate?
InvestorsInvestors
Agri-BusinessAgri-Business
AutomotiveAutomotive
EnergyEnergy
Policy & GovernmentPolicy & Government
Bio-fuels IndustryBio-fuels Industry
TransportationTransportation
Equipment ManufacturerEquipment Manufacturer
Copyright © 2006 Global Insight, Inc. 17
Kick-off Meeting: October 2006
Study Timetable
Final Client Presentation: Early 2007
Final Report: The Bio-fuels Boom February 2007
Monthly Bio-fuels Webcast: December 2006
Copyright © 2006 Global Insight, Inc. 18
Interim Webcasts: SCENARIO REVIEW IMPLICATIONS FOR ENERGY, AGRICULTURE, & TRANSPORTATION SECTORS
Deliverables
Kick-off Meeting: NORTH AMERICA, EUROPE, ASIA
Results Presentation: NORTH AMERICA, EUROPE, ASIA
On-site: OPTIONAL, ON-SITE PRESENTATION OF STUDY RESULTS
Final Report: ANALYSIS & RESULTS; WEB-BASED DATA ACCESS
Copyright © 2006 Global Insight, Inc. 19
Project Team
Kevin Lindemer Refining Sector & Alternative Energy Economics
Phil Gott Automotive Technology
Stewart Ramsey Agricultural Economics
Juliette Kerr Latin American Bio-fuels Industry Policy & Analysis
Sarah Kingsbury Automotive Sector
Dick Buttigeig Automotive Sector
Mary Novak Energy Policy & Modeling
Margaret Rhodes Energy Policy & Modeling
Copyright 2006 Global Insight, Inc. 19
Copyright © 2006 Global Insight, Inc. 20
Previous Studies in Bio-fuels by Global Insight
1. Study of the Global Bio-fuels Market to Identify Business Opportunities – 2006
2. U.S Federal Highway Administration: Forecasting Revenues from Highway Trust Fund
3. Global Bio-fuels – The Next Step Towards Environmentally Neutral Transportation?
4. National Railroad – Prospects for U.S. Ethanol Production
5. The Potential for Increased Market Share for Alternative Fuels
6. Winners and Losers of Ethanol Mandates
7. Identification and Assessment of Alternative Fuels Market Drivers
For Further Information
Gil Rodgers Senior Director, Energy Group tel: 781.301.9142 em:[email protected]
www.globalinsight.com/energy