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Profit in the Canada Biofuel Industry

Canada Biofuels Market Potential
Canada Biofuels Market Potential

Biofuel is any fuel that is derived from biomass - recently living organisms or their metabolic byproducts, such as manure from cows. It is a renewable energy source, unlike other natural resources such as petroleum, coal, and nuclear fuels.

Ethanol is manufactured from microbial conversion of biomass materials through fermentation. Ethanol contains 35% oxygen. The production process consists of conversion of biomass to fermentable sugars, fermentation of sugars to ethanol, and the separation and purification of the ethanol. Fermentation initially produces ethanol containing a substantial amount of water. Distillation removes the majority of water to yield about 95% purity ethanol, the balance being water. This mixture is called hydrous ethanol. If the remaining water is removed in a further process, the ethanol is called anhydrous ethanol and is suitable for blending into gasoline. Ethanol is “denatured” prior to leaving the plant to make it unfit for human consumption by addition of a small amount of products such as gasoline.

Biodiesel fuels are oxygenated organic compounds - methyl or ethyl esters - derived from
a variety of renewable sources such as vegetable oil, animal fat, and cooking oil. The oxygen contained in biodiesel makes it unstable and requires stabilization to avoid storage problems. Rapeseed methyl ester (RME) diesel, derived from rapeseed oil, is the most common biodiesel fuel available in Europe. In the United States, biodiesel from soybean oil, called soy methyl ester diesel, is the most common biodiesel. Collectively, these fuels are referred to as fatty acid methyl esters (FAME).

Biofuels have become a growth industry with worldwide production more than doubling in the last five years. The rapid expansion of ethanol production in the United States and biodiesel production (and to a lesser extent, biogas) in Germany and other countries in Western Europe has created a biofuels frenzy that has affected many countries, including Canada. Many measures have been used to stimulate production and consumption of biofuels, including preferential taxation, subsidies, import tariffs and consumption mandates. Recently, Canadian federal and provincial governments have announced consumption mandates and subsidies to assist rapid expansion of biofuel production in Canada.

Canada has considerable natural resources and is one of the world’s largest producers and
exporters of energy. In 2006, Canada produced 21.1 quadrillion British Thermal Units (Btu) of total energy, the fifth largest amount in the world. Since 1980, Canada’s total energy production has increased by 86%, while its total energy consumption has increased by only 48% during that period. Almost all of Canada’s energy exports go to the United States, making it the largest foreign source of U.S. energy imports: Canada is consistently among the top sources for U.S. oil imports, and it is the largest source of U.S. natural gas and electricity imports. Recognizing the importance of the energy trade between the two countries, both participate in the North American Energy Working Group, which seeks to improve energy integration and cooperation between Canada, the U.S., and Mexico.

The report Biofuel Industry in Canada is a complete coverage of the ethanol and biodiesel
market in the country.


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Pages: 74
Publication Date: October 2008
Publisher: Energy Business Reports
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