2013-08 Fueling The Future Atlantic Bioenergy PDF

Fueling the Future:
Atlantic Canadas
Bioenergy Opportunities Project
Project Report
APRI Project No. 200344
Atlantic Canadas Bioenergy Opportunities Project
APRI No. 200344
Acknowledgments
This report was produced by the Atlantic Council for Bioenergy Cooperative (ACBC) under
the leadership of Ken Magnus, Chief Executive Officer in partnership with BioAtlantech
New Brunswick, with funding from the Atlantic Canada Opportunities Agency.
The project team recognizes the work, cooperation, support, and assistance of:
ACBCs Executive and Board of Directors
BioAtlantech
Gardner Pinfold Consulting
Dr. Gerrard Marangoni
Interprovincial working groups in New Brunswick, Nova Scotia and PEI, including
their respective departments of Energy, Agriculture and Economic Development.
Atlantic Canada Opportunities Agency (ACOA)
Cape Breton University Verschuren Centre for Sustainability in Energy and the
Environment (CSEE)
Collge communautaire du Nouveau-Brunswick (CCNB)
This report is based on information gathered between March 2012 and May 2013.
Disclaimer:
This report is funded by the Atlantic Canada Opportunities Agency (ACOA) under the Atlantic
Policy Research Initiative, which provides a vehicle for the analysis of key socio-economic
policy issues in Atlantic Canada. The views expressed in this study do not necessarily reflect the
views of ACOA or of the Government of Canada. The author is responsible for the accuracy,
reliability and currency of the information.
APRI No. 200344
Executive Summary
Introduction & Purpose
The biofuels sector provides Atlantic Canada with the opportunity to position its assets
wisely, and to use them to build a sustainable biofuels industry in this region. With the
development of initial and first generation biofuels production facilities across Canada and
elsewhere in recent years, Atlantic Canada can capitalize on those experiences to determine
how they may best apply here. With the regulatory push to spur industry at the federal
level, the regional innovative capacity, recent and ongoing research, access to academia, and
the availability of renewable resources, there is ample room for a large scale commercial
biofuels industry development to take shape in Atlantic Canada.
Acting in the capacity of Atlantic Canadas lead bioenergy association, ACBCs mission is to
educate and promote the development of a sustainable bioenergy industry in Atlantic
Canada and to establish provincial and federal government policy and programming that
will allow for the development of a bioenergy industry in the Atlantic region.
ACBCs vision statement is: a vibrant, sustainable bioenergy industry, producing in Atlantic
Canada, for Atlantic Canada, with a near term outlook to export and supply outside of the
region to meet the increasing demands of the United States biofuels market.
To this end, Atlantic Canada needs both federal and provincial government policy and
programming (P&P) designed to meet its needs for growth. With this project, ACBC intends
to clarify, assess and reveal the regions bioenergy; build a business case for a bioenergy
sector in the region; identify the economic impact of that sector; and ultimately make
recommendations for the necessary policy and programming.
This project is ground-breaking. This type of information is not currently readily available
in Atlantic Canada; and, data and findings that do exist elsewhere cannot provide a realistic
and accurate picture of this regions potential. This project and its findings will be an
instrumental starting point to provide governments and industry players with an
understanding of the potential for bioenergy in the Atlantic region and clear
recommendations for moving forward to deliver the economic opportunity, jobs and
environmental benefit for Atlantic Canadians.
Methodology
The information contained in this report is the result of in-person interviews; online
surveys; research analysis; engagement and discussion with industry and government
stakeholders provincial and federal, elected and non-elected; and finally, significant
analysis, deliberation and recommendation from the ACBC Board of Directors and its
members.
Its findings are validated through the analytical work of Gardner Pinfold, one of Canadas
leading economic consultants, who were contracted to assess the feasibility of this sector, as
well its economic impact. This firms background, expertise, and strong reputation for
quality research and methodological reporting provide important credibility and
calculated proof for the arguments and recommendations this project makes.
APRI No. 200344
This project was delivered through methods including: an asset inventory, research analysis
a feasibility model, an economic impact analysis and recommendations.
Assets & Opportunity

The biofuels industry in North America is driven mainly by the Renewable Fuels Standards
(RFS) introduced by various levels of government in Canada and the U.S. To meet the RFS
mandate in Atlantic Canada, the region would have to produce in excess of 250 ML of
ethanol and approximately 75 ML of biodiesel. In fact, the potential biofuel opportunity is
seen as significantly greater since fuel produced with energy beets and other potential
feedstocks specific to this region would qualify as a blendstock under the U.S. RFS2. There is
also a substantially larger export market opportunity not defined in this report but that
could easily double demand.
Atlantic Canada is rich in natural resources and it is these natural resources where the
biomass assets lie. The regions provinces have a long history of agriculture, forestry and
marine biomass and consumption. This, combined with the regions extensive technological
research capacity (numerous academic and institutional research organizations) provides
the right backdrop for the industry to grow and develop.
Agriculturally, there is sufficient crop acreage to produce a number of potential feedstocks
including corn, wheat, barley, soybean, canola and sugar / energy beet as well as provide
farmers the opportunity to develop new crops and rotations, putting underutilized land
back into production. An emerging biofuels industry could create demand for suitable
crops that are not currently grown, or not grown in sufficient quantities, at acceptable costs,
to meet industry requirements. Cellulosic biomass crops (including marine and forestry
sectors) also offer potential, once the production technology to support it is
commercialized; new technologies and applications present significant opportunity in this
region.
References in this report to biofuel production volumes in Atlantic Canada are represented
by the numbers suggested above and demonstrated in the below table; it confirms that
Atlantic Canada has and can produce the necessary feedstock to build a viable biofuels
industry, and that stakeholders are ready and capable to support its development and
growth, with the proper tools in place.
APRI No. 200344
5% Blend Ethanol
10% Blend Ethanol
2% Blend of Bio-diesel
Motor gasoline
1.195 BL
59 MML
118 MML
Diesel Fuel Oil
889 MML
18 MML
Heating Oil
904 MML
18 MML
Nova Scotia Fuel Energy
New Brunswick Fuel Energy
5% Blend Ethanol
Motor gasoline
1.129 MML
56 MML
Diesel Fuel Oil
1.189 MML
24 MML
317 MML
6 MML
Heating Oil
PEI Fuel Energy
10% Blend Ethanol
112 MML
5% Blend Ethanol
Motor gasoline
230 MML
11.5 MML
Diesel Fuel Oil
132 MML
3 MML
Heating Oil
192 MML
4 MML
Newfoundland Fuel Energy
10% Blend Ethanol
23 MML
5% Blend Ethanol
10% Blend Ethanol
Motor gasoline
670 MML
33.5 MML
67 MML
Diesel Fuel Oil
521 MML
10.42 MML
Heating Oil
611 MML
12.22 MML
APRI No. 200344
SWOT Analysis
Stakeholders have identified a number of internal and external factors that are favorable
and unfavorable to building a bioenergy sector in Atlantic Canada.
The SWOT analysis is based on the following definitions:
Strengths characteristics that provide it an advantage.
Weaknesses (or Limitations) characteristics that create a disadvantage
Opportunities: external factors in the environment that could improve performance

(e.g. make greater profits)
Threats: external factors in the environment that could cause trouble
STRENGTHS
Significant & diverse biomass
Open territory - development, policy
and programming
Renewable Fuels Standards
Established lead agency
Strong research and academic
community
Existing producers, plants
Interested governments
WEAKNESSES
Lack of awareness, understanding
Perception that region cannot deliver
volume
Behind industry pace
Federal funding spent
No strong government champion
Lackof experience as a sector
SWOT ANALYSIS
OPPORTUNITIES
Outside investment interest
Cellulosic capacity
Close proximity for export
Shared desire to end imports
Traditional industries (feedstocks)
available to support sector
Federal mandate for renewable fuels
production
Regional priority for economic
development and employment
THREATS
Current reliance on imported biofuels
Global economic challenges
Provincial governments face fiscal
constraint
Limited will for provincial mandates,
policy and programming
Resistance towards implementing RFS
APRI No. 200344
Feasibility
To understand the true cost and potential return on investment for production facilities in
Atlantic Canada, Gardner Pinfold Consultants Inc., were contracted to develop a tool that
producers and lending agencies could use to analyze prospective ethanol and biodiesel fuel
projects an Atlantic Biofuels Feasibility Model.
The model is designed to help assess the financial viability of biofuels production options in
Atlantic Canada, based on six key factors: feedstock types, plant scale, pre-construction and
construction costs, financing, operating costs and revenues.
After entering information for each of these six areas, the Model calculates production
results and financial indicators to assess the potential performance of a biofuel plant. The
Model can evaluate up to six plants simultaneously and provide a summary of results for all
six on a final comparison sheet, with a profile of the inputs for each plant. A side-by-side
comparison gives operators the opportunity to evaluate the performance of plants that
might have different feedstocks or different capacity. Additionally, model users could adjust
any number of other variables such as feedstock price, interest rates, % equity, revenue,
or capital costs to different levels, to see how they might impact the overall performance
of a plant.
This ability to assess the impact of different variables can also help operators identify what
they need to make a plant financially attractive to bank lenders or private investors. For
instance, a potential plant may initially appear to have an 8-year payback period; but, a
combination of variables like low-interest loans, capital cost assistance, feedstock subsidies,
and salary rebates could be examined to determine what might bring the payback period
down any number of years.
This model will allow industry proponents and their associated partners and investors to
consider several options that may be applicable to their region, and their particular
expertise, to help assess the financial viability of biofuels production options in Atlantic
Canada.
Economic Impact
The firm of Gardner Pinfold Consulting Inc. was also engaged to assess the economic impact
for the biofuels sector in Atlantic Canada, to provide industry and government with a tool to
improve the understanding and further the development of a biofuels industry in this
region. The study set out to answer the question: If a bio-fuels industry were to develop in
the Maritime Provinces, what would be its impact? Because current biofuels production in
this region is not operating on the scale needed to meet federal ethanol and bio-diesel
mandates, there is no basis to document economic impacts.
The information in this study will provide prospective investors, lenders and governments
with a better understanding of the scale of the industry and how its development and
operation would affect the economies of each of the Atlantic Provinces, tracing the direct
impacts of the bio-fuels industry itself, as well as the indirect impacts of those industries
supplying it with goods and services.
APRI No. 200344
The main objective of this study was to quantify both the direct and spin-off impacts of
developing and operating a biofuels industry in the Atlantic Provinces; to do so, it uses the
Statistics Canada Inter-provincial Input-Output Model, because it produces direct, indirect
and induced impact results and it produces results at a high level of resolution. Normally,
this model uses the gross value of the output, the revenues generated through sales of the
final product, to measure economic impact. But, because there is no established biofuels
industry in the Maritime Provinces, this study instead uses the value of the commodities
used in the production process.
The report states that economic impact can be measured by four indicators: GDP,
employment, labour income and tax revenue.
For the purpose of estimating economic impacts, this study used the above mentioned
volumes 250 ML ethanol and 75 ML biodiesel as the basis for a biofuels industry in
the Maritimes. The study also assumes that biofuels plants have a capacity of 25 ML.
Accordingly, this region would require 13 plants to meet the full 325 ML capacity.
The analysis shows then, a one-time regional economic benefit of plant construction
totalling approximately $373.1 M in GDP, over 5,000 FTEs, an average total income of
$256.1 M and average total tax revenue of $81.9 M.
Once biofuels plants are operational, the region will see positive economic impact, year over
year. Again, based on the operation of 13 plants to meet the full 325 ML capacity in this
region, the annual economic impacts will total up to $244 M in GDP, nearly 5,000 FTEs, an
annual income of $125 M and an annual tax revenue to federal and provincial governments
of close to $50 M.
New Brunswick
Nova Scotia
Prince Edward Island
(GDP, Income & Tax in $000s Employment in FTE)
1 Plant
5 Plants
1 Plant
4 Plants
1 Plant
4 Plants
Maritime
Provinces
13 Plants
GDP
Direct
Indirect
Induced
Total
Employment
Direct
Indirect
Induced
Total
8,430
8,145
2,804
19,379
41,140
41,855
12,883
95,878
5,845
9,455
2,708
18,008
23,380
37,820
10,831
72,031
7,925
8,710
2,235
18,870
31,700
34,840
8,940
75,480
96,220
114,515
32,654
243,389
15
224
104
343
85
1,210
510
1,805
30
240
95
364
120
959
378
1,457
20
269
99
388
80
1,076
394
1,550
285
3,245
1,283
4,813
930
6,720
1,275
8,925
5,270
35,020
5,865
46,155
1,845
7,055
1,300
10,200
7,380
28,218
5,202
40,800
1,240
7,430
1,020
9,690
4,960
29,720
4,080
38,760
17,610
92,958
15,147
125,715
694
1,744
1,590
4,028
2,774
6,977
6,360
16,111
8,822
22,629
16,782
48,233
Income
Direct
Indirect
Induced
Total
Tax revenue
Corporate
715
3,532
629
2,516
Personal
1,607
8,308
1,836
7,344
Sales & excise
890
5,850
1,143
4,572
Total
3,211
17,690
3,608
14,432
Source: Tables 2 and 4.
Note: NB plants composed of three biodiesel and two sugar beet ethanol.
APRI No. 200344
Finally, these figures represent annual impacts for an industry with a long-term life
expectancy, of 25 years or more. Operating at its full potential, year over year, a biofuels
industry will result in significant long-term economic impact for the Maritime provinces.
Combining these two identified economic impacts for the region over a 5 to10 year period,
including the time and resources to build the plants and the overall operations of the plants
could result in a $Billion economic impact, with potentially $300 to $500M in government
tax revenue and thousands of jobs.
Recommendations
Throughout the duration of this project, ACBC worked with its industry association
members, Atlantic bioenergy stakeholders, Maritime Canada production facility proponents,
industry producers & refineries, industry distribution companies, research and academic
professionals, provincial and federal government officials and bioenergy stakeholders at
large.
The result, after 18 months of engagement and information sharing, are numerous findings,
which lead to most importantly, the proposal of recommendations to support the
development of a biofuels production industry in Canada and achieve the economic and
environmental impacts the industry holds for this region. They present significant
immediate impact, in addition to other short and long-term benefits for Atlantic Canada,
demonstrating that support for this sector can result in jobs, economic development and
opportunity for multiple other sectors in the region.
These recommendations are based on experiences and working solutions from other parts
of Canada, North America and the world, with proven track records for government support
and industry success, including a demonstrated return on investment. They are an initiative
for government collaboration and industry cooperation, seeking commitment from both the
Government of Canada and the provincial governments of New Brunswick, Prince Edward
Island and Nova Scotia and will require an aggressive and committed plan of action form all
parties.
The following four recommendations are proposed as the key public policy instruments
required to set the stage and drive industry development for Atlantic Canada.
RECOMMENDATION #1
IMPLEMENTATION OF RENEWABLE FUELS REGULATIONS
Specifically:
The government of Canada continue to finalize and implement the renewable fuels
regulations as legislated.
The Maritime Provinces adopt complimentary provincial renewable fuels

legislation.
APRI No. 200344
This report repeatedly suggests that a proposed and potentially successful biofuels industry
for the Maritime region is based on the indented national implementation numbers, and
would provide for an industry production scale of well above 300 ML of biofuels, produced
locally, and providing local economic and environmental benefits. Implementing a
Renewable Fuels Standard on a provincial basis, that is equal to that already in place
nationally, eliminates current gaps in policy, puts an end to the confusion, and solidifies the
commitment to succeed in this arena.
RECOMMENDATION #2
NATIONAL & CORRESPONDING PROVINCIAL CAPITAL ASSISTANCE
PROGRAMMING
Specifically:
Atlantic Biofuel Capital Development Initiative: The introduction of a Government

of Canada capital assistance program for Atlantic Canada creating the opportunity
for equity investment by primary feedstock producers in the region.
Provincial Biofuel Capital Initiative: The Provinces of NB, PEI, and NS introduce a
corresponding and complimentary provincial capital assistance program, to expand
on and to include the opportunity for equity investment by primary feedstock
producers and / or other provincial residents, companies or organizations.
ACBC and its membership believe that it is important to create the best opportunity for
local ownership of newly constructed biofuels production plants. Local production, in our
opinion should be owned by local people whenever possible. Local ownership will help
create more local jobs and economic spin-offs for local economies. Capital assistance
programming can provide the opportunity for farmers, communities and local residents at
large to participate in the value-added biofuel production industry in the region through
investment ownership.
This recommendation is potentially of little or no cost to governments and tax payers, as
this is a repayable loan. Furthermore, these loans could be held by the lenders (provincial
and federal) pending the completion of a feasibility study and overall approved financial
package from its investors/stakeholders and all other lenders, thereby mitigating further
government risk. All other approvals and commitments must be in place and both the
federal government and the applicable provincial governments could present a set of
criteria that must be met prior to approval.
APRI No. 200344
RECOMMENDATION #3
MATCHING FEDERAL & PROVINCIAL PRODUCTION INCENTIVES
Specifically:
Atlantic Biofuel Production Initiative: The Government of Canada introduces a

production incentive program for qualifying regional producers. Program eligibility
would expire after a regional production capacity of 325 million litres is met or
upon a fixed date of program eligibility applications.
Provincial Biofuel Production Initiative: The Provinces of NB, PEI and NS create and
introduce a Provincial production program initiative, with compatible terms,
conditions and time lines.
Atlantic Canadas production of biofuels must be competitive with other production plants
throughout Canada and North America. To compete, the region must first be on a level
playing field. In order for the industry to succeed in this part of the country, it must be able
to provide quality product, at a competitive price, and at a guaranteed production volume.
The minimum production for domestic consumption within this region, based upon the
blended amounts suggested in recommendation #1 is well over 300 million litres per year.
Production incentives can secure the ability for local production to successfully meet its
financial obligations, pay back its loans and compete in the marketplace for the long term.
Even though the industry here is just now getting its legs, an Atlantic specific program that
provided a matching provincial / federal production incentive would be the final piece to
ensure industry development in this region. It would result in a direct payout or cost to
government; however, as identified through the Gardner Pinfold analysis, the economic
impact of a biofuels industry of this scale, in this region, over a 5 year period, has the
potential to exceed $1B. The contribution for this type of program would only be utilized if
the industry builds to the recommended capacity suggesting that the anticipated
economic benefit of over $1B would be realized by our local communities. This has the
potential to be a very good investment with great results.
RECOMMENDATION #4
ESTABLISH A REGIONAL WORKING GROUP COMPRISED OF INDUSTRY,
GOVERNMENT AND ACEDEMIC REPRESENTATIVES
Specifically, the working group would have the following responsibilities and tasks:
Primarily, to consider the recommendations of this report and initiate a broader

dialogue on the potential for development of this industry in this region;
And further, to identify additional opportunities to participate in the national
dialogues in this policy area;
And continue to build relationships between, and across governments to further
examine programs and incentives related to bioenergy.
10
APRI No. 200344
Seek to strengthen coordination, engagement and partnerships between industry,

government and academia, in particular with the respect to research and
development, and other technological innovation.
Identify other project-specific items on an ongoing basis that could be initiated and
implemented through the working group organization.
Atlantic Canada is a small region, both in terms of population and geographic proximity. To
build an industry consisting of 8-15 plants, development on a regional scale versus by
individual province just makes sense. An effective policy for industry development, on a
regional scale, must come through collaboration among all players in the region.
Interprovincial and federal/provincial relations will be not only valuable, but essential to
this regions success.
In this industry, like many others, one of the key pieces in the puzzle is adequate,
appropriate, and applicable research and development. This is particularly true for this
industry, at its current stage of development. As Atlantic Canada emerges into the biofuels
production arena, the region must consider different technologies, feedstocks and overall
applications to the future of this industry. The background research required for this report
has reinforced ACBCs understanding that industry and academia must work together in
order to progress together. Our members and our stakeholders recognize that R&D is not
only important, but essential, and when done in consultation and partnership with industry
has the potential to yield impressive and economically beneficial results.
This recommendation could in fact be the most important; by bringing together government
partners, facilitating research and development, and building a solid foundation for
progress, this working group will be the catalyst to eventually drive forward all
recommendations in this report and bring the Atlantic Canada biofuels industry to a whole
new level.
ACBC and its membership are confident that these recommendations demonstrate the first
collaborative effort of an organized and established pan-Atlantic industry group.
This report clearly indicates that accepting, approving and implementing all of these
recommendations will provide the right circumstances to create exciting opportunities and
positive change for this region of Canada.
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APRI No. 200344
Conclusion
This report is the result of a comprehensive project spanning 14 months of research,
engagement and information sharing to the ACOA team and regional stakeholders. It details
numerous findings and proposes four recommendations that hold great economic promise
for Atlantic Canada and its stakeholders in the biofuels industry.
Together, the recommendations represent the first collaborative effort of an organized and
established pan-Atlantic industry group a long-term, committed and documented
interaction with biofuels and bioenergy stakeholders through the New Brunswick, Prince
Edward Island and Nova Scotia, as well as national and regional input for an informed and
dedicated community of industry leaders and supporters.
This report has been prepared by the Atlantic Council for Bioenergy Cooperative Limited
(ACBC) in collaboration with BioAtlantech, New Brunswicks lead bioscience agency, with
all reasonable skill, care and diligence, and taking account of the resources devoted to it by
agreement with the client.
Information reported herein is based on the interpretation of data collected and has been
accepted in good faith as being accurate and valid.
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TABLE OF CONTENTS
Preface
Introduction
Methodology
Assets and Opportunity
Introduction to Bioenergy Feedstock
Regional Opportunities for Cellulosic Biofuels
Improving Production Costs of Ethanol and Biodiesel via the Integration of

other Biodiesel Conversion Technologies
Other Second Generation Feedstocks
13
The Agricultural Picture
16
Anticipated Feedstocks in Atlantic Canada
17
Preferred Feedstocks for the Maritimes
23
Consideration of Non-Agricultural Feedstock for the Region
27
Stakeholders in Atlantic Canada
28
Stakeholder Survey Results
28
Bioenergy / Biorefinery Research Network
31
Market Capacity
33
Current Renewable Fuel Facilities across Canada
34
The Potential for Advanced Bioenergy Technology in Atlantic Canada
38
The Atlantic Opportunity Regional Consumption and Export
43
Research Analysis
47
SWOT Analysis
47
Testing and Analysis for Quality Control
52
Policy and Programming
53
APRI No. 200344
Atlantic Canada Biofuels Feasibility Model
67
Economic Impact Study
72
Recommendations
78
Conclusion
85
Appendices
Appendix A Stakeholder Survey Summary of Results
Appendix B Atlantic Canada Research Network
Appendix C The Case for Cellulosic Ethanol
Appendix D Cellulosic Biofuels Production & Demonstration Facilities in Atlantic
Canada
Appendix E Bioenergy Technology in Atlantic Canada
Appendix F Letter to Federal Ministers
Appendix G QA / QC Capabilities and Capacity
Appendix H Provincial / Territory Contacts
Appendix I Atlantic Canada Biofuels Feasibility Model
Appendix J Economic Impact of a Biofuels Industry
APRI No. 200344
Preface
The biofuels industry is an emerging and dynamic industry; it is still, in many respects in the
early stages of development. For example, the Canadian Governments Renewable Fuel
Standard (RFS) came into effect only recently. The requirement for 5% ethanol content in
gasoline became mandatory across Canada - with the exception of designated regions,
including the far north and Newfoundland and Labrador on December 15th, 2010. And
July 1st, 2011 marked the official start for implementing the required renewable fuel content
for biodiesel, with a delayed schedule for Atlantic Canada originally set for January 1st, 2013.
There remains some uncertainty on the biodiesel implementation schedule for Atlantic
Canada, which is likely to now come into force mid-year 2013, and proposed amendments
may all together remove the home heating fuel requirement on a national basis.
The biofuels sector provides Atlantic Canada with the opportunity to position its assets
wisely, and to use them to build a sustainable biofuels industry in this region. With the
development of initial and first generation biofuels production facilities across Canada and
elsewhere in recent years, Atlantic Canada can capitalize on those experiences to determine
how they may best apply here. With the regulatory push to spur industry at the federal
level, the regional innovative capacity, recent and ongoing research, access to academia, and
the availability of renewable resources, there is ample room for a large scale commercial
biofuels industry development to take shape in Atlantic Canada.
Note: This report makes reference to the region, as well as both Atlantic Canada and the
Maritimes. The overall picture of bioenergy is applicable to Atlantic Canada as a whole;
however, biofuels specific discussions may not reference Newfoundland or remote Northern
regions of Canada where they are currently exempt for the Canadian Renewable Fuels
Regulations.
APRI No. 200344
Introduction
Acting in the capacity of Atlantic Canadas lead bioenergy association, ACBCs mission is to
educate and promote the development of a sustainable bioenergy industry in Atlantic
Canada and to establish provincial and federal government policy and programming that
will allow for the development of a bioenergy industry in the Atlantic region.
ACBCs vision statement is: a vibrant, sustainable bioenergy industry, producing in Atlantic
Canada, for Atlantic Canada, with a near term outlook to export and supply outside of the
region to meet the increasing demands of the United States biofuels market.
To this end, Atlantic Canada needs both federal and provincial government policy and
programming (P&P) designed to meet its needs for growth. With this project, ACBC intends
to clarify, assess and reveal the regions bioenergy assets; build a business case for a
bioenergy sector in the region; identify the economic impact of that sector; and ultimately
make recommendations for the necessary policy and programming. Furthermore, it is the
intention of ACBC to be the ongoing liaison between industry and government(s) now and
into the future as this industry develops and matures, and to be the authority for future
economic development initiatives and job creation opportunities for bioenergy industry
development in Atlantic Canada.
This project is ground-breaking. This type of information is not currently readily available
in Atlantic Canada; and, data and findings that do exist elsewhere cannot provide a realistic
and accurate picture of this regions potential. This project and its findings will be an
instrumental starting point to provide governments and industry players with an
understanding of the potential for bioenergy in the Atlantic region and clear
recommendations for moving forward to deliver the economic opportunity, jobs and
environmental benefit for Atlantic Canadians.
APRI No. 200344
Methodology
The information contained in this report is the result of in-person interviews; online
surveys; research analysis; engagement and discussion with industry and government
stakeholders provincial and federal, elected and non-elected; and finally, significant
analysis, deliberation and recommendation from the ACBC Board of Directors and its
members.
Its findings are validated through the analytical work of Gardner Pinfold, one of Canadas
leading economic consultants, who were contracted to assess the feasibility of this sector, as
well its economic impact. This firms background, expertise, and strong reputation for
quality research and methodological reporting provide important credibility and
calculated proof for the arguments and recommendations this project makes.
This project is delivered through the following methods:
Asset Inventory to define the regions existing biofuels market, including an assessment
of its current resources (feedstocks), its stakeholders (producers) and its potential for
growth (what will work in the future, and when).
Research Analysis to reveal the strengths, weaknesses, opportunities and threats for this
sector.
Feasibility Model through contract with Gardner Pinfold, to understand the true cost
(whats needed to build this industry) and potential return on investment for bioenergy
production facilities.
Economic Impact Analysis through contract with Gardner Pinfold, to analyse the
research and using the Statistics Canada Input-Output Model, calculate the economic
impacts of this sector and provide a sliding scale of analysis based on the minimum and
maximum potential of the industry.
Recommendations - based on the information gathered, to support the opportunity for
growth of the bioenergy sector in this region.
APRI No. 200344
ASSETS & OPPORTUNITY

Introduction to Bioenergy Feedstock
Bioenergy is energy contained in living or recently living biological organisms, a definition
which specifically excludes fossil fuels. Plants get bioenergy through photosynthesis, and
animals get it by consuming plants. Organic material containing bioenergy is known as
biomass. Humans can use this biomass in many different ways, through something as
simple as burning wood for heat, or as complex as genetically modifying bacteria to create
cellulosic ethanol which can be burned as fuel. Since almost all bioenergy can be traced
back to energy from sunlight, bioenergy has the major advantage of being a renewable
energy source. However, it is important that bioenergy be harnessed in a sustainable
fashion.
A specific plant or substance used for bioenergy is called a feedstock. Feedstocks are usually
converted into a more easily usable form, typically a liquid fuel. Feedstocks refer to the
crops or products, like corn, wheat, canola and waste vegetable oil that can be used as or
converted into biofuels and bioenergy. Each feedstock has advantages and disadvantages in
terms of how much usable material they yield, where they can grow and how energy and
water-intensive they are to use.
Almost any plant-based material can be an ethanol feedstock. All plants contain sugars, and
these sugars can be fermented to make ethanol. Some plants are easier to process into
ethanol than others - because starch or cellulose need to be processed in order to provide
sugars for fermentation. Some don't require many resources to grow, while others need
many resources (inputs), as well as intensive care and support in order to flourish. Some
plants are used for food as well as fuel, while others are cultivated exclusively for biofuels or
other uses. Even plant-based wastes can be made into biofuels. Climate, soil and inputs all
define the types, amounts and costs associated with determining the types of plants that can
be grown in different geographic areas.
Biodiesel refers to a vegetable oil- or animal fat-based diesel fuel consisting of long-chain
alkyl m methyl, propyl or ethyl esters. Biodiesel is typically made by chemically reacting
lipids i.e. ., vegetable oil, animal fat (tallow) with an alcohol producing fatty acid esters.
Biodiesel is meant to be used in standard diesel engines, distinguishing it from the
vegetable and waste oils used to fuel converted diesel engines. Biodiesel can be used alone,
or blended with petrodiesel and can also be used as a low carbon alternative to heating oil.
This report will identify regional feedstocks that are most likely to work for Maritime
Canada, now and into the future, both in agricultural and non-agricultural feedstock supply.
Note: Reference to biomass, for purposes of this report, is not wood or grass-based pellets. The
bioenergy pellet industry is a different discussion for a different mandate and time.
Biomass for this report is organic feedstocks (resources) for liquid biofuels and biogas. In both cases,
the supply and demand for biomass is critical, and we believe there are sufficient amounts available in
Atlantic Canada on which to establish a domestic and export biofuels industry.
ACBC and this project support and promote the use of Atlantic-based biomass for the development of the
biofuels and biogas industry here.
APRI No. 200344
Ethanol Feedstocks
Starch and Sugar-Based Ethanol Feedstock
Nearly all ethanol is derived from starch- and sugar-based feedstocks. The sugars in these
feedstocks are easy to extract and ferment, making large-scale ethanol production
affordable. Corn is the leading U.S. crop and serves as the feedstock for most U.S. and
Canadian domestic ethanol production; wheat is the second most predominant feedstock
used in Canada Small amounts of energy beets, wheat, milo (sorghum) and sugarcane are
also used on smaller scales
Cellulosic Ethanol Feedstocks
Cellulosic feedstocks are non-food based feedstocks that include crop residues, wood
residues, and dedicated energy crops and industrial and municipal wastes. These feedstocks
are composed primarily of cellulose and may contain hemicelluloses, and lignin - typically
lignin is extracted to provide process steam for production. The complex, rigid nature of
these feedstocks makes it much more challenging to release the sugars for conversion to
ethanol; this difficulty in converting the biomass to sugars results in a higher conversion
cost to corn and wheat based ethanol. Cellulose conversion is technically feasible but as of
yet the conversion costs are considerably higher than that of sugar and starch based ethanol
conversion processes; however this gap is narrowing and will benefit further from timing
and research and development. So, when reports indicate that certain specific cellulosic
ethanol is 5 to 10 years in the future, they are not referring to technical feasibility but to
improvements in the technology that will provide economic feasibility.
Most plants and trees are made of inedible cellulose. Cellulose, in the form of firewood has
been used as a basic form of bioenergy for millennia. Recent advances in bioenergy, ranging
from the simple biomass pellets to the complex cellulosic ethanol, have created a need for
high-yielding feedstocks.
The crops under consideration are mostly grasses and trees, which as perennial crops may
also provide a range of environmental benefits over annual crops like corn and soybeans.
The yields of cellulosic feedstocks are much higher because any part of the plant can be
used. Cellulosic feedstocks also don't compete with food; they are seen as the best hope for
large-scale, sustainable biofuel production. Crops, like switchgrass and miscanthus, which
are grown purely for energy and have no use as food or fiber, are also called dedicated
energy crops.
Cellulosic technologies that can use these feedstocks include Cellulosic ethanol, biomass-toliquids, gasification, biogas and others.
Examples of Grass based energy crops
1. Miscanthus
2. Prairie grasses
3. Switchgrass
Examples of Trees based energy crops
Short rotation soft woods (hybrid Willow, industrial hemp, alders, poplar)
Wood waste materials (slash, woodchips, sawdust, MSW Municipal Solid Waste))
APRI No. 200344
Other cellulosic feedstocks offer many advantages over starch- and sugar-based feedstocks,
including alders and willow, which are currently being explored in the Maritime region.
They are more abundant and can be used to produce more substantial amounts of ethanol
to meet fuel demand. They are waste products or, in the case of trees and grasses grown
specifically for ethanol production, can be grown on marginal lands not suitable for other
crops. Less fossil fuel energy is required to grow, collect, and convert them to ethanol, and
they are generally not crops that are used for human food. There are challenges with
harvesting, collecting, and delivering cellulosic feedstocks, but researchers are studying
these challenges in an effort to find solutions.
There are many industry producers and proponents of cellulosic biofuels, at several stages
of development and delivery. In many cases cellulosic biofuels are being produced, but not
considered as profitable as traditional or 1st generation biofuels. The traditional methods of
producing ethanol from cellulose involve pre-treatment to break up the fibers to allow the
removal of lignin which is an inhibitor of fermentation. The cellulose and hemicellulose are
then hydrolyzed to simple sugars using either enzymes, or a strong acid or strong base. The
fermentation of the resulting sugars is still often not as efficient as the fermentation of
sucrose or starch based sugars due to trace amounts of other chemicals from the biomass
that effect yeast growth and metabolism.
An alternative method for producing biofuels from cellulose that is being researched by a
few groups in Europe, Canada and the USA is the production of biocrude using high
temperature and pressure and upgrading this biocrude to diesel or gasoline using catalysts.
This catalyst process is identical to the process used by the petroleum refining industry to
produce gasoline and diesel from crude oil. As this technology improves and develops it
will most likely supersede the current cellulosic biofuels process that is the major focus of
many companies in the USA and Canada (e.g. Mascoma, Poet, Iogen etc.).
Neste Oil from Finland is using this process commercially to produce green diesel from
palm oil. Alphakat (www.alphakat.de/temp.company.php) in Germany and Kior
(www.kor.com) in the USA are also developing processes for converting forestry and
agriculture biomass. A new company called Cellufuel was recently formed in Nova Scotia
and has developed its own proprietary green diesel technology with plans to build a pilot
plant in 2013-2014 and commercial plants across Canada starting in 2015.
However, this renewable diesel fuel faces the same challenges as biodiesel does in the
region with respect to the lack of policy and programming at the provincial level.
Government policy and programming, in coordination with research and industry
development is, and will be key to the pace and success of cellulosic biofuels production
around the world. Commercialization of these processes is a funding priority of the U.S.
Department of Energy's Biomass Program, as well as the government of Canada through
Sustainable Development Technology Canada (SDTC). However, Canadian funding is not as
significant as the U.S. based programs and should be enhanced.
APRI No. 200344
Regional Opportunities for Cellulosic Biofuels

A recent study completed by Halifax Global for ACOA focused on the opportunities for
cellulosic biofuels in Atlantic Canada. The report indicates an opportunity for Nova Scotia,
Newfoundland and possibly New Brunswick to repurpose idle assets or to integrate with
existing mills to produce biofuels. Nova Scotia has the most available wood biomass that is
not secured by the industry for pulp and paper or lumber production. The development of a
biofuels sector in Nova Scotia focused on using woody biomass would have a significant
impact on the rural regions of the province as well as providing a local supply of renewable
fuel. However, while the biomass is available, the lack of provincial biofuel mandates and
specific programming will make it challenging to establish this sector.
The most recent development in Nova Scotia that will help with the development of the
conversion technology from forest biomass is the establishment by Innovacorp Inc. of a
bioprocessing incubator complex on the former Mersey-Bowater mill site in Liverpool. This
site will provide an excellent place for companies developing biofuels process from forest
biomass to pilot and demonstrate their processes. It would also make sense that if the
process demonstration was to take place in Nova Scotia that the first commercial plant
would also be located there.
Source: Milley, Peter. 2012. Assessment of cellulosic Biofuels Potential in Atlantic Canada.
Example Theoretical Ethanol Yields of Selected Cellulosic Feedstocks
Feedstock
Conversion to Liquid Biofuel
Corn Stover (stalks and cobs)
1500 litres/acre; not cellulosic under RFS 2
Straw (Wheat, barley and oats)
280 litres/acre; not cellulosic under RFS 2
Wood Waste
200 litres / Dry Ton
Switch grass
1000 litres/acre based on a yield of 20 tons/acre
Miscanthus
1000 litres/acre based on a yield of 20 tons/acre
Sweet Sorghum
1000 litres/acre
Reed Canary
500 litres/acre
Timothy
300 litres/acre
Willow
420 litres/acre
Poplar
1000 litres/acre
Municipal Waste
400 litres/Dry Ton
Sources include: http://www.oilgae.com/, http://www.fao.org/, https://bioenergy.ornl.gov/,

http://www.greenfacts.org/en/index.htm, http://www.greenfuels.org/
Notes:
1) It is still not known whether switch grass, miscanthus, sorghum can be successfully grown in our region and if so,
what sort of yield we can expect. There are studies underway in each of the provincial departments of Agriculture.
2) Production acreages and yields are variable based on market demand and agronomic production practices
(varieties, fertilizer usage, etc.)
APRI No. 200344
Example Theoretical Ethanol Yields of 1st Generation Feedstocks (non- cellulosic)

Feedstock
Corn
940 litres/acre
Wheat (spring)
430 litres/acre
Barley
361 litres/acre
Oats
220 litres/acre
Rye
186 litres/acre
Triticale
240 litres/acre
Energy Beets
3500 litres/acre
Under RFS2 Advanced Biofuel
Potatoes
570 litres/acre
Waste alcohol
190mls/gallon (based on a 5% ethanol w/v waste stream
Sources include: http://www.oilgae.com/, http://www.fao.org/, https://bioenergy.ornl.gov/,

http://www.greenfacts.org/en/index.htm, http://www.greenfuels.org/ ACBC Board Members
Notes:
1) Estimated supplies of feedstocks may already have other markets and may not be available for use in the
production of biofuels. Alternatively, while they might be sold into other markets currently there is nothing to stop
suppliers switching markets if they can obtain a higher or competitive price. This also has value for crop rotation.
(varieties, fertilizer usage etc.).
3) Ethanol conversion yields litres/acre is based on regional yield averages. In comparing our starch based cereals
with other regions of Canada and the USA, our % starch is usually slightly lower and the Atlantic region experiences
a lower yield/acre due to our shorter growing season.
4) While the yield of ethanol per acre (for potato) is very high, the value of the potato as a food crop is much too
costly to use as a feedstock for ethanol production. However approximately 10% of all the potatoes produced in the
region are not able to be sold for food due to appearance, size etc. These are referred to as culls, and these culls can
be used for ethanol production. Currently there is no guaranteed market with a guaranteed price for these cull
potatoes.
5) Energy Beets while the substrate used for the production of ethanol from the sugar beets is sucrose, the large
yield per acre and low input of energy required to convert the sucrose to ethanol, results in a carbon foot print
comparable to the use of cellulosic feedstocks. So while it is does not produce `cellulosic ethanol` it would be correct
to say that it produces an ethanol equivalent to cellulosic ethanol.
APRI No. 200344
Improving Production Costs of Ethanol and Biodiesel via the Integration

of other Bioenergy Conversion Technologies
Biomass can be converted to a combustible gas by biological processes such as anaerobic
digestion (biogas), or a thermochemical process, gasification (syngas). The integration of
these processes with ethanol and biodiesel production improves both the economics
(allowing a smaller scale) and the environmental sustainability of the process. One of the
major challenges facing ALL bioprocessing companies in the region (e.g. pulp and paper) is
the high cost of energy in Atlantic Canada, compared to the rest of Canada and to the USA,
resulting in a non-competitive price point for the final product. The only solution to high
energy costs is the integration of an alternative energy source as part of the process that can
reduce energy costs and keep the opex as low as possible over the long term. While the
integration of bioenergy to offset energy costs improves the opex, it will increase the initial
capex by 20-25%.
Biogas
In anaerobic digestion, methane biogas is produced from organic feedstock. The feedstock
can be wet organic material such as manure, sewage sludge, industrial effluents, and
agricultural and forest residues. Biogas from anaerobic digesters is composed primarily of
methane, which can be used to generate the electricity and /or steam heat necessary for
processing other feedstocks into ethanol and biodiesel. One of the Atlantic regions primary
challenges when it comes to comparing production costs with commercial operations in the
USA, Western and Central Canada is the lack of access to low cost electricity or natural gas.
In order to be able to competitively produce ethanol and biodiesel in the region energy cost
will be a factor. One way of accomplishing this is via the integration of an anaerobic
digester producing methane for combined heat and power. This integration of biogas into
the process is often referred to as a closed loop production processes where waste streams
of the ethanol and/or biodiesel process are used to partially or fully fuel the process. In
addition to energy production the anaerobic digester produces a natural fertilizer byproduct that can be used in the crop production, again potentially reducing the cost and
carbon foot print of the feedstock being grown.
The primary use of biogas is as a local fuel for the generation of combined heat and power
(heat and electricity). However biogas is similar in composition to natural gas and can be
used as a compressed transportation fuel (requires a natural gas vehicle or a converted
diesel engine). Biogas can also be treated using a steam process to produce bioethanol.
The biogas industry in Canada is growing rapidly, with over 20 farm digesters in operation
across the country and an anticipated 40-plus farm-based digesters in Ontario alone by the
end of 2013. The increase in Ontario can be directly attributed the provincial Fee-in-Tariff
program in place which offers guaranteed pricing for renewable electricity production from
the provincial government. There are currently only two functional commercial biogas
digester systems in Atlantic Canada with another two more in development. One of the
commercial systems is located at the Cavendish Farms processing complex in PEI where the
biogas is used to provide up to 30% of the complexs heat supply (the remaining 60% is
provided with natural gas transported from the Enbridge pipeline in Sackville New
Brunswick). The other commercial system is located in St. Andr New Brunswick on a Dairy
Farm. This biogas digester is owned and operated by Laforge Bioenvironmental and uses
the biogas to produce electricity and heat (CHP). The current system has a production
capacity of 600kwh and will soon be expanded to 1.6 MWH. Laforge is exploring the
APRI No. 200344
possibility of producing compressed biogas for transportation fuel for use on the farm and
in its waste collection vehicles.
Atlantic Bioenergy Corp., with its demonstration facility based in PEI, produces ethanol
from energy beets. Its proprietary and innovative process has an anaerobic digester as its
energy source. It converts all the processing plants by-product streams to energy. Not only
does this reduce production costs and produce a fertilizer by-product for crop production, it
also results in the ethanol product being classified as an advanced biofuel in the USA
(Currently the only advanced biofuel available in the USA is from South America Sugar Cane
Ethanol).
The biogas sector has the potential to be more economically and environmentally viable
than the ethanol and biodiesel sectors. However the policy and programming related to
biogas production at both the farm and industrial level are sadly lacking in the region. Nova
Scotia is the only jurisdiction with some programming and policy, whereas PEI and New
Brunswick have no policy and programming related to biogas production.
Gasification
Gasification is a thermochemical process that occurs when biomass is heated in an oxygenstarved environment (containing approximately 1/3 of the air needed for complete
combustion) to produce a synthetic gas (i.e. syngas), which contains carbon monoxide and
hydrogen. Any reasonably dry biomass can be converted to syngas, which can also be used
as a fuel for combined heat and power generation. Source www.nrcan.gc.ca .
Gasification is most suited to the conversion of lignicellulosic residues that are not easily
degraded microbial for biogas production. In regions where forest residues and
construction and demolition waste is abundant, the use of gasification power and heat
generation can reduce energy costs in the production cycle. Waste materials from the
primary process (ethanol and/or biodiesel) can also be converted to energy using
gasification. There are currently no projects in the region that use gasification. The Cape
Breton University, Verschuren Centre for Sustainability in Energy and the Environment will
focus research efforts on gasification and its applications for converting forest biomass to
both heat and electrical energy. Again, because Nova Scotia has a Community-Feed in Tariff
program and a need for alternative electricity, it is the most likely region to begin
developing gasification in the energy sector. New Brunswick, with a large amount of forest
residues, could also take advantage of this technology, but a lack of programming and policy
are hindering current development.
Biodiesel Feedstocks
Biodiesel can be produced from a large variety of feedstocks, including vegetable oils,
animal fats and recycled cooking oils (also known as yellow greases):
Virgin oil feedstock canola, rapeseed and soybean oils are most commonly used,
soybean oil alone accounting for about ninety percent of all fuel stocks in the US and
Canada. It can also be obtained from field pennycress and jatropha and other crops
such as mustard, jojoba, flax, sunflower, palm oil, coconut, hemp.
Waste vegetable oil (WVO), also called waste cooking oil (WCO).
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Animal fats including tallow, lard, yellow grease, chicken fat and the by-products of
the production of omega-3 fatty acids from fish oil.
Algae, which can be grown using waste materials such as sewage.

Oil from halophytes such as Salicornia bigelovii which can be grown using saltwater
in coastal areas where conventional crops cannot be grown, with yields equal to the
yields of soybeans and other oilseeds grown using freshwater irrigation.
Mink oil anaerobic digestion of mink waste carcasses for the production of
biodiesel.
Feedstock yield efficiency per unit area affects the feasibility of ramping up production to
the huge industrial levels required to power a significant percentage of vehicles. In Canada,
the most common vegetable oils are from dedicated crops such as soybean and canola. Since
canola has a higher oil content, lower cloud points and pour points, and is in a large net
export position compared to soy, it is considered a better feedstock for biodiesel
production. Currently, biodiesel produced in Canada is mainly made from yellow grease and
animal fats, which are the most cost-effective feedstock, and generate relatively fewer GHG
emissions than others. As newer large scale production plants come on line in Canada, for
example Archer-Daniels-Midland (ADM) in Alberta and Milligan BioTech in Saskatchewan,
canola continues to become a more predominant biodiesel feedstock in Canada.
Example Theoretical Biodiesel Yields of Selected Feedstocks
Feedstock
Canola
300 380 litres per acre
Tallow
Difficult to estimate
Soybean
240 litres/acre
Sunflower
320 litres/acre
Hemp
150 litres per acre
Flax
190 litres/acre
Camelina
235 litres/acre
Mink oil/fat
0.25 kg oil/carcass
Fish oil / waste
0.7 litres/litre of fish oil produced from waste

Extracted oil is ~ 11% of total weight of fish waste
Waste Cooking Oil (WCO) or

Waste Vegetable Oil (WVO)
Difficult to estimate.
Microalgae
19,000 litres/acre
WVO in the region estimated to be 12 MML/Yr
5000-15000 gal [theoretical laboratory yield]. Extrapolated

from the ability to have successive harvests over a year long
period. Assumes 100% utilization rate
Seaweed
400 litres/acre
Sources include: http://www.oilgae.com/ , http://www.fao.org/ , https://bioenergy.ornl.gov/ ,

http://www.greenfacts.org/en/index.htm, http://www.greenfuels.org/ ACBC Board Members
11
APRI No. 200344
Notes:
1) Canola production in the Maritimes is also increasing. Industry estimates put total acres for Nova Scotia, New
Brunswick and P.E.I. at 13,000 acres in 2011, up from 6,000 acres in 2010 and 1,000 in 2006. P.E.I. had 3,000 acres
of canola the past few years.
2) Estimated supplies of feedstocks may already have other markets and may not be available for use in the
production of biofuels. Alternatively while they might be sold into other markets currently there is nothing to stop
suppliers switching markets if they can obtain a higher price.
(varieties, fertilizer usage etc.).
4) Because canola is considered by this report to be a very possible first choice agricultural feedstock. It is necessary
to make the following comment, in relationship to the above table and the conversion to liquid biofuel of 300 litres
per acre.
300 litres per acres is based on calculations by www.canolainfo.org and the Manitoba Canola
Growers, that one bushel of canola will make 11 litres of oil, and that the Canadian Canola Growers
estimate an average 35 bushels per acre. So, one acre should produce 385 liters of oil.
Recovery of oil to biodiesel is 9.95 percent, so this number could be as high as 380.
300 litres per acre is therefore a reasonable minimum. For purposes of this report we have used a range
of 300 to 380 litres, which would be accurate for future discussion purposes.
5) All the waste tallow and cooking oil that could be used for biodiesel production in the region is currently
collected and processed by 2 companies: 1) Rothsay rendering and 2) SF Rendering. Both companies have biodiesel
production capacity. Rothsay (rendering) has a biodiesel facility producing 1 million litres of biodiesel per week in
Montreal PQ. All the collected oil and tallow suited for biodiesel production from the Atlantic Region is shipped to
Montreal for conversion and sold into the Ontario and Northern US markets. SF Rendering currently does not
produce biodiesel because the price it can obtain for tallow and waste oil in the animal feed market is higher than
they can obtain for biodiesel. While the waste fat and oil is collected by these companies for free or a small pickup
charge they do not pay for the resource. If the price of biodiesel was sufficient to allow companies to purchase
waste oil and fat the resource would belong to the highest bidder.
6) Biodiesel potential yield from microalgae and macroalge are guesstimates as these feedstocks are still in the
early stage development. The initial evaluation of these resources indicates that they far out-produce the
traditional plant based oil resources.
Waste Cooking Oil

Many advocates suggest that waste vegetable oil is the best source of oil to produce
biodiesel. Early indication suggests that less than half of the current requirement for
biodiesel production in New Brunswick may be supported by waste oil. Production plants
would likely have a much lower initial capital cost associated with them, because they
would not require a crushing facility like canola and soybean feedstocks. However, the
quality of the used oil determines the overall production cost and yields of the biodiesel
produced from the oil. Moderately degraded fats and oils tend to be less expensive to
produce than heavily degraded materials.
Canola
Agricultural production of Canola for biodiesel in New Brunswick, Nova Scotia and PEI is a
very realistic and immediate potential feedstock for Atlantic biodiesel production.
Reference to production capacity of canola in these three provinces, and its potential for
meeting biodiesel demand for this region and for export, will be identified later in this
report.
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Animal Waste and Animal Fats

Animal fats are a by-product of meat production and cooking. Although it would not be
efficient to raise animals (or catch fish) simply for their fat, use of the by-product adds value
to each of these industries (hogs, cattle, poultry, aquaculture). Today, multi-feedstock
biodiesel facilities are producing high quality animal-fat based biodiesel.
A $5-million dollar plant is currently being built in the U.S., with the intent of producing 11.4
million litres (3 million gallons) of biodiesel from some of the estimated 1 billion kg (2.2
billion pounds) of chicken fat produced annually at the local Tyson poultry plant. Similarly,
some small-scale biodiesel factories use waste fish oil as feedstock. An EU-funded project
(ENERFISH) suggests that at a Vietnamese plant built to produce biodiesel from catfish
(basa, also known as pangasius) with an output of 13 tons/day of biodiesel (produced from
81 tons of fish waste -in turn resulting from 130 tons of fish). This project utilizes the
biodiesel to fuel a CHP unit in the fish processing plant, mainly to power the fish freezing
production side.
Another project currently underway closer to home is Newfoundland and Labrador Marine
Institutes biorefinery demonstration project. This project was started in late 2011 with a
target completion date of December 2013. The scope includes processing waste streams
from the local and federal fisheries (including salmon, snow crab, shrimp, groundfish) and
organic municipal wastes, to produce fish meal products, bio actives (chitin and chitosan),
marine oils (for human and animal consumption) and eco energy including biodiesel, as
well as electricity and heat through anaerobic digestion. The project received substantial
federal and provincial support to the tune of $800,000- as well as buy-in from 2 major
industry partners. The objectives of the project are simple: to demonstrate technical and
economic feasibility, promote full utilization of resources and minimize waste and generate
eco energy and revenues to support the local sector.
Note: The current national renewable fuel standards exempt Newfoundland and Labrador.
Other Second Generation Feedstocks

While humans have been growing grasses and trees for millennia, there are completely
novel crops being considered as bioenergy feedstocks. Even more than cellulosic
feedstocks, developing techniques to cultivate these crops at a scale deemed acceptable for
production continues to pose some major challenges. However the utilization of marine
biomass for bioethanol and biodiesel production is undoubtedly a sustainable and ecofriendly approach for renewable biofuel production.
Using algal biomass as feedstock for bioethanol production is promising, because of the
large amounts of carbohydrates embedded in the physiology in algal cells. Oleagenous (oilbearing) algae are a particularly attractive material, because its oil can initially be extracted
for biodiesel production, and then its high-carbohydrate residue can be processed for
ethanol fermentation. Compared to terrestrial plant biomass (which is also a popular
biofuel-ethanol feedstock), algae have exponentially higher growth rates.
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Algae (microalgae)
The production of biofuel from algae involves three basic steps: algae growth, biomass
extraction, and post processing.
In the first stage of large scale algae biofuel production, algae are grown in a network of
bioreactors on an agricultural scale. The collected biomass is then processed through
several mechanical, drying, and chemical steps to yield the final biofuel product. The
finished biomass is suitable as a direct substitute for coal, petcoke and related fossil fuels.
Biocrude can also be extracted from the biomass and further processed into biodiesel in the
third step through a chemical process that results in biodiesel that meets the appropriate
regulatory standards for use in the existing fuel distribution system (for example US ASTM
D6751).
Note: The NRC research facility in Halifax is the Canadian Centre of Expertise in Microalgae production for oils.
Seaweed (macroalgae)
Seaweed to biofuels has an interesting potential application for Atlantic Canada, as
promoted recently in the January 2012 edition of Scientific America
(http://www.scientificamerican.com/article.cfm?id=genetically-engineered-stomachmicrobe-turns-seaweed-into-ethanol ) where an article demonstrated how an altered
version of the E. Coli bacteria had been used to unlock a treasure trove of sugars found in
brown kelp.
The authors sell how this seaweed, completely devoid of lignin, is capable of ethanol
production of 1,500 gallons per acre, which is 50% more than sugar cane and roughly triple
that of corn.
Seaweed and the technology to unlock its sugar potential has the oil world a buzz with
national and multi-national companies working to exploit regions abundant in this natural
resource. Bordered by the ocean, Atlantic Canada is a region rich in brown kelp and as
technologies to harness this resource become more available, Atlantic Canada is sure to
benefit.
There is already a commercial market for macroalgae in North America and elsewhere,
mainly as food or as feedstock for polysaccharide and hydrocolloid extraction, which is
relatively small when compared with the scale of cultivation needed for macroalgae to be
considered a significant contributor to the biomass needed to meet RFS production goals.
However, the resource potential here is high, and the ability of the worlds oceans to
produce marine biomass as a biofuel feedstock supply is still considered largely untapped.
This opportunity to produce and process marine biomass is an important opportunity for
the Atlantic Region. With the exception of British Columbia we are the region with the
greatest access to marine environments. While the use of these marine biomass resources
(other than fish processing wastes) will not provide the biomass for biofuel production in
the next 5 years (domestic supply) they will definitely be a part of any industry expansion
and fuel export strategy moving forward. It is vital that the region invest in the long-term
development and use of these resources as it will not only provide additional production
capacity to the industry in the future but it will attract research funding dollars, technology
investors in the short term, develop a regional expertise that could be of global significance
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and have the longer term potential to provide revenues from intellectual property and
production and processing systems manufacturing.
Woody Biomass/Woodchips
Todays biorefineries convert crops such as corn, soy, and sugar into biofuels, but current
research and development if focusing on the next generation of biofuels, which will be
produced from multiple cellulose feedstocks including woody biomass, energy crops, and
residuals including agricultural and other wastes. Major breakthroughs in cellulosic
conversion and commercialization of these new biorefineries are expected in the short
term.
Woody biomass has been considered and used as a feedstock for biofuels production
throughout many parts of the world. As is the case in many new technologies for biofuel
production, prod-cutting fuel from this feedstock is doable, however the questions of
profitability still remain an issue. As technologies improve, it is more likely that woody
biomass will be used for commercial scale production in this region.
Atlantic Canada obviously has easy access to large amounts of woody biomass feedstock,
and additionally has biofuels proponents who have the desire, the interest and the
resources to convert woody biomass or woodchips in both ethanol and biodiesel or green
diesel.
One example of the move to commercial scale production in the United States is ZeaChem
Inc. (www.zeachem.com) who is phasing in operations of new integrated facility for
cellulosic ethanol production as a result of their recent Series C financing ($25Millon). We
believe Atlantic Canada also has the potential to move into commercial scale production
with the use of this regional feedstock. For example:
a) CelluFuel Inc. is a Nova Scotia based company founded by four forestry veterans
with experience in industry and finance. Their objective: to become the pioneer in
the commercialization of transportation biofuels, based on woody biomass, in
Eastern Canada. CelluFuel has already raised $500,000 from a New York buyout
shop with strong links to the biofuel industry, and they have licensed proven
technology in the most energy-efficient process they could find for producing
energy from wood products. CelluFuel is currently establishing a presence in the
former Bowater Mersey paper mill in Brooklyn, Nova Scotia to produce biodiesel
from wood waste, believed to be the first step in an ambitious plan for 10 plants
within the next six years.
b) Groupe Savoie has the potential to become a leader in next generation biofuels
production in Atlantic Canada. With nine industrial facilities two sawmills, one
pallet plant, one component plant, one pellet plant and dry kilns in St-Quentin,
N.B.; one component plant and a dry kiln in Kedgwick, N.B.; one pallet production
and recycling plant in Moncton, N.B.; and, one sawmill in Westville, Nova-Scotia
Groupe Savoie has a significant amount of its own woody biomass residuals, which
it intends to use to supply feedstock for a commercial scale biofuels production
facility in Atlantic Canada. Research and development is currently underway.
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The Agricultural Picture

In the Canadian agriculture sector, large farms dominate production, accounting for only
2.5% of farms, but 40% of revenues. In 2007 and 2008, as commodity prices have risen,
farm market receipts and net farm income for grain and oilseed farms have also increased.
Canada ranks as the second largest in the world for the availability of arable land per person
which also accounts for Canada being a large producer and exporter of agricultural
products. Canadas share of land suitable for agricultural production accounts for only a
small percentage (5%) of the total land in use without a loss in energy content.
Source: http://www.statcan.gc.ca
The agriculture, forestry, fishing and hunting sectors contributed nearly 2.2% to Canadian
GDP in 2007, of which crop production accounted for approximately 54.5%. The crop
production sector employed nearly 298 844 persons. In 2007, the value of crops exported
was nearly $13 billion while imports totaled $6.4 billion with the United States being the
largest trading partner, followed by Japan.
Source: http://www.ic.gc.ca/eic/site/icgc.nsf/eng/home
In addition to reductions in GHG emissions, one of the key drivers for supporting renewable
fuels production and use is the benefit that it can bring to the agriculture sector and rural
Canada. Increased renewable fuels production in Canada will result in increased local
demand for feedstocks and new markets for Canadian agricultural producers crops. For
example, biodiesel facilities can provide a market for off-grade canola, which is not suitable
for the food or feed market.
Providing agricultural producers with the opportunity to invest in and develop profitable
renewable fuels projects that use agricultural products as inputs will help to create a
positive stream of income that could be more independent of commodity price swings. This
would also encourage an approach that goes beyond simple commodity production to focus
on new ways to add value to biomass produced on farms. This would also encourage an
approach that goes beyond simple commodity production to focus on new ways to add
value to biomass produced on farms. Renewable fuel plants would inject additional
spending into the local rural economies, broadening their tax base and generating
additional jobs at the local level.
Further expansion of the renewable fuel industries in Canada is expected to rely on
feedstock supplied by the Canadian agricultural sector. However, the projected level of
renewable fuel production in Canada is not expected to impair the agriculture sectors
ability to provide agricultural commodities for traditional uses, such as for food production
and livestock feed. Consequently, downstream industries such as meat and food processing
are not expected to be impacted with respect to production, employment, price and trade.
Furthermore, impacts on consumer food prices are not expected.
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Anticipated Feedstocks in Atlantic Canada

Stakeholders have identified several biofuels feedstocks in Atlantic Canada: energy beets,
canola, feed wheat, corn, soybeans, camelina, barley, alders, grasses, forestry waste,
municipal waste, rendering / tallow, fish oil, yellow grease, cellulosic / straw, algae, and
more.
Basically all feedstocks will work for biofuels production; the question is what is most
applicable in this region for availability, ability to produce, cost effectiveness for
production facilities, and acceptability by the industry and the public. Atlantic Canada has
ample land base and agricultural ability to produce sufficient feedstock for regional biofuels,
based on the Canadian RFS, and also has sufficient land and agricultural resources to supply
feedstock to produce biofuels for export.
According to Statistics Canada, (2006) the total area of land on farms in NS, NB and PEI is
approximately 2.5 million acres, of which just over 1 million acres is cropland. Nova Scotia
Agriculture for example identifies that there is 1 million hectares (ha) of land suitable for
agriculture in NS alone. 40,000 ha or 98,842 acres are underutilized (source:
www.statcan.gc.ca) and could be available for biofuels production. Although it is difficult to
identify the number, it is commonly understood that since 1930 there had been hundreds of
thousands of acres of farm land that has come out of agricultural production, and has gone
back to unused lands. Some would suggest that number is as high as 1.1 million acres.
The Agricultural Biomass Availability for Bioenergy Applications in Nova Scotia report by
Michael Main, NSAC May 22, 2008 suggests:
40-60 thousand hectares or land could be available for biomass crops, providing up
to 750,000 tonnes biomass fuels (13,500,000 GJ/y).
Manures could provide up to 300,000 GJ/y of biogas
Minimal crop residues are available
Development depends on strong energy prices and supportive policy
Perennial grass or coppice have the greatest sustainable potential
In Atlantic Canada, the discussion regarding food vs. fuel, in our opinion is irrelevant, based
on two key considerations:
Current production facilities in other parts of Canada that use canola, wheat and
corn for feedstock, traditionally use non-food grade production of these crops.
Based on the number of acres available for agricultural production in Atlantic

Canada, that are currently being cropped, and the large amount of acres that are
available for crop, supplying feedstock for energy does not impact food supply.
Furthermore bringing agricultural land into production for biofuels, from existing
land, will help the agricultural community add an additional crop into their crop
rotation strategy, and will add another opportunity for sales of their agricultural
commodities.
Bringing underutilized land back into production for biofuels feedstock, creates the
opportunity for an emerging industry to develop; it has potential for agricultural value add,
and when the value to produce food on these new acres occurs, the land will have been
brought back to useable condition in order to grow traditional food crops.
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APRI No. 200344

Statistics on Agriculture in PEI
Source: www.statcan.gc.ca and provincial departments gathered from engagement of agricultural officials and
feedback from the inter-provincial roundtable.
In 2011, Prince Edward Island continued to report

the largest area of potatoes in the country with
86,560 acres.
Soybean area in Prince Edward Island increased
351.6% since 2006 to 51,116 acres in 2011, making
it one of the major field crops in the province.
Prince Edward Island accounted for 72.5% of the
Maritime province's total in 2011. In the Maritimes,
soybean area increased 352.8% since 2006 to
70,492 acres in 2011.
Largest area of potatoes in Canada
Soybean crop on the rise
Total farm area = 594, 324 acres
69.1 % cropland grains and

oilseeds
Farm area: Total farm area in Prince Edward Island (2011) is 594,324 acres; the average
area per farm (2011) is 398 acres.
Of the total farm area in Prince Edward Island in 2011, 69.1% (410,712 acres) was reported
as cropland the total area in field crops, hay, fruits, field vegetables, sod and nursery.
Proportion of cropland, Prince Edward Island, 2011
Composition of cropland
Percent of cropland*
* Totals may not equal 100% due to rounding

Source: Statistics Canada, Census of Agriculture, 2011
Field crops
65.0
Hay
31.2
Fruits
3.1
Vegetables
0.6
Sod and Nursery
0.1
The majority of cropland (96.2%) was reported as field crops and hay. The proportion of
field crops (including potatoes) increased to 65.0% in 2011. Conversely, the proportion of
hay decreased to 31.2%. Increased prices for cash crops coupled with declining beef cattle
and pig numbers led to a shift from forages and crops traditionally used for feed to more
profitable cash crops. Other crops, including vegetables, fruit, sod and nursery production,
accounted for an additional 3.8% of total cropland.
Grains and oilseeds are the largest groups of crops grown on PEI. Grains are primarily
grown in rotation with potato crops. In 2010, Statistics Canada estimated that there were
99,000 acres of wheat, oats, barley and mixed grain and 44,000 acres of soybeans seeded on
the island. Barley accounted for 50,000 acres. Milling wheat is grown for the production of
flour. One third of the soybean acreage in 2009 was exported to Japan to be processed into
tofu and miso. Canola is being grown and pressed for oil that is used for food and fuel. The
remaining grains and soybeans are fed to livestock on the island.
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New Brunswick
Statistics on Agriculture in NB
Source: www.statcan.gc.ca and provincial departments gathered from engagement of agricultural officials and
feedback from the inter-provincial roundtable.
Top 3: Corn, soybeans, canola
Total farm area = 0.9 million acres
37.5 % cropland
Abandoned farmland 12,000+ hectares

available for redevelopment
Corn for grain, soybeans and canola

areas: In 2011, corn for grain in New
Brunswick accounted for 10,611 acres,
soybean area was 10,600 acres and canola
area was 9,002 acres.
Farm area: Total farm area in New
Brunswick (2011) was 0.9 million acres;
the average area per farm is 359 acres.
Of the total farmland (2011), 37.5% (351,231 acres) was reported as cropland, the total
area used in field crops, fruits, vegetables, sod and nursery.
Proportion of cropland, New Brunswick, 2011

Source: Statistics Canada, Census of Agriculture
Field crops
40.8
Hay
49.7
Fruits
8.5
Vegetables
0.5
Sod and Nursery
0.4
The majority of cropland (90.5%) in New Brunswick was reported as field crops and hay.
Field crops (including potatoes) represented 40.8% of reported cropland.
Area Under Crops in NB
Acres
Hay and field crops,

2011
Spring wheat (excluding
durum)
Winter wheat
3,624
Buckwheat
1,676
Alfalfa and alfalfa

mixtures
All other tame hay and
fodder crops
Barley
573
31,988
142,484
Area Under Crops in NB
Acres
Forage seed for seed
108
Mixed grains
945
Mustard seed
Oats
Other field crops
0
23,324
55
Potatoes
51,814
Soybeans
10,600
Spring rye
485
23,144
Sugar beets
9,002
Sunflowers
Corn for grain
10,611
Total corn
Corn for silage
6,995
Total rye
690
34
Triticale
Canola (rapeseed)
Dry field peas

Fall rye
Flaxseed
17,606
205
X
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The New Brunswick Department of Agriculture provides estimates between 11,400 and 21,400
hectares of abandoned farmland suitable for redevelopment for modern agricultural purposes.
For purposes of this assessment, abandoned farmland was defined as land that has grown up into
goldenrod, has sporadic small bushes, or has standing grass not cut and could easily be developed
for modern agricultural purposes. Lands that had 50% or more woody species or fields that had
completely reverted to woody vegetation were not included in the inventory as they would be
considered equivalent to a tree stand or forested area in terms of cost and ability to develop the
lands for agriculture.
Several factors have contributed to the abandonment of farmland, including: the transition from
small family farms to larger mechanized farms; poor soils, poor topography, poor drainage, poor
location; and urban sprawl and development.
Nova Scotia
Statistics on Agriculture in NS
Source: www.statcan.gc.ca, St. Marys University and provincial departments gathered from engagement of agricultural
officials and feedback from the inter-provincial roundtable.
In 2011, Nova Scotia was the only province in Canada to show an increase in the number of farms
since 2006, reporting a total of 3,905 farms and accounting for 1.9% of Canadas 205,730 farms.
Increased area of corn for grain and
soybeans: The area of corn for grain in Nova
Scotia increased 77.4% since 2006 to 13,701
acres in 2011, while soybean area more than
tripled to 8,776 acres.
Farm area: Total farm area in Nova Scotia
(2011) is 1.0 million acres; the average area per
farm was 261 acres.
Corn, soybeans on the rise
Total farm area = 1 million acres
27.6% cropland
90,000 hectares of unused land available

for biofuels development
Of the total farm area in Nova Scotia in 2011, 27.6% (280,889 acres) was cropland the total area
used in hay, field crops, fruits, field vegetables, sod and nursery.
Proportion of cropland, Nova Scotia, 2011

Field crops
18.8
Hay
58.9
Fruits
18.7
Vegetables
2.4
Sod and Nursery
1.2
Source: Statistics Canada, Census of Agriculture
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The majority of cropland (77.7%) in Nova Scotia was reported as field crops and hay (Table 1). The
proportion of hay decreased from 64.7% in 2006 to 58.9% in 2011. Field crops (including potatoes)
represented 18.8% of cropland in 2011, up from 15.7% in 2006. Increased prices for cash crops
coupled with declining beef cattle and pig numbers led to a shift from forages and crops
traditionally used for feed to more profitable cash crops.
Nova Scotia agriculture department research identifies that there is approximately 90,000 acres of
underutilized land that could be developed for agri-biomass for biofuels production. According to
Nova Scotia agriculture about 1 million hectors of land is suitable for agriculture of which 215,000
hectors are currently cleared. A discussion paper for a 2006 agricultural bioenergy policy forum
held at St. Marys University estimated that 250,000 hectares could be brought into production on
the better quality soils not presently farmed. According to Statistics Canada, census of agriculture
in Nova Scotia the total area under-crop production in 2006 was approximately 375,000 acres and
in 1961 it was just under million acres.
Preferred Feedstocks for the Maritimes

Atlantic Canadian growers can clearly produce agricultural feedstock for development of a biofuels
industry in Atlantic Canada; it is not a hurdle, but rather an opportunity.
Total farm land = 2.5 million acres
Cropland: 1 million acres

Potential farmland (unused): Hundreds of
thousands of acres
Best bet: canola, soybeans, energy beets,

corn
What we know from information and statistics

provided by the government of Nova Scotia, New
Brunswick and Prince Edward Island is that the
approximate total area of farm lands in these
three provinces is 2.5 million acres. The
approximate current combined acres of cropland
is just over one million acres, with a combined
potential of an additional amount of
underutilized farmland in the range of 100s of
thousands of acres.
Based on what the industry looks like today, and the successes of the production facilities that exist,
the short term (then next 5 to 15 years) agricultural feedstocks that will work best in Atlantic
Canada are Canola and soybeans for biodiesel, as well as energy beets, non-food grade wheat, and
corn.
To target Atlantic production in a range of 250 million litres to 300 million litres of ethanol and 50
to 100 million litres of biodiesel the following examples could be used.
Notes: based on numbers as of January 2013 from NRCan and Stats Can regarding numbers of litres in the
Maritimes, as well as the uncertainty of blending biofuel to home heating oil, therefore adjusting the numbers to
a range amount.
Ethanol by energy beet feedstock:
One acre of beets will produce a minimum of 3500 litres of ethanol.
5 ethanol plants of 50 million litres capacity each would produce 250 million litres of
ethanol for Atlantic Canada. Each plant would require feedstock from approximately
14,000 + acres of beets, or a total of approximately 70,000 + acres.
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Biodiesel by canola feedstock:
One bushel of canola produces approximately 11 litres of biodiesel.
An average yield per acre for canola is 25-35 bushels per acre, depending on conditions, soil
and the region. However, due to recent and improved farming practise throughout Canada,
average yield per acre and overall production of canola is on the increase.
For purposes of the example we can use an average of 30 bushels per acre. At 11 litres per
bushel and average acre of canola should produce approximately 300-380 litres. 50 million
litres of biodiesel would require about 140,000 to 150,000 acres of canola produced in
Atlantic Canada. Or a 20 million litre plant in each province would require about 50,000
acres each.
Source: http://www.ccga.ca/
Biofuels production companies must pay fair market value to producers in order to secure
feedstock. The recent history of agricultural based biofuels production plants in North America
tells us that this is the case, and that if there is profit in the production of agricultural energy
feedstock agricultural producers will grow it. Ultimately, proponents and producers of biofuels will
determine the best feedstock to succeed in their production and sales of biofuel.
Feedstocks for Ethanol
Ethanol production facilities, both operational and demonstration, use the following feedstocks:
corn, energy beets, wheat, cellulosic / straw, barley and rye. Most predominantly used are wheat
and corn; however, in the past few years and as recently as in the last year, a lot of progress has
been made on the development of new strains and technologies for energy beet production in
Atlantic Canada. Beets are a good agricultural rotation crop, and are easily grown in this region of
Canada. Additionally, beet production per acre is 3 times the amount for wheat in relationship of
conversion to ethanol.
Energy beets produce 3500 litres of ethanol per acre; so, 10,000 acres of energy beets will produce
35 million litres of ethanol. Corn, at its best, can produce 1600 litres of ethanol per acre and
sugarcane runs between 2400-2700 litres per acre. If the entire supply of the Canadian RFS at 5%
ethanol for NS, NB and PEI, came from agricultural based supply of beets, just fewer than roughly
70,000 acres would be required. (Source: http://www.cleantechloops.com/energy-beets/)
Also, the carbon footprint for energy beets is very minimal. This is important, because in the U.S. the
Renewable Fuels Standard 2 (RFS 2) addresses environmental benefits by the carbon footprint of
the end use product, and in order to be considered next generation or a cellulosic biofuel product,
certain gates or levels must be met. Energy beets currently being produced in Atlantic Canada, at a
demonstration plan operated by Atlantec Bioenergy Corporation (ABC), meet the US RFS 2
standard as an advanced biofuel. Under these same standards, corn, barley and wheat along with
any by-products from these crops are not considered advanced or cellulosic. It is also important to
consider that specific biofuel production plants that meet U.S. standards for Renewable
Identification Numbers (RINs) can provide significant additional income and potential for
profitability for locally located production plants, making export potential very attractive.
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APRI No. 200344
ACBC believes that energy beets are the feedstock most likely to succeed for ethanol in Atlantic
Canada. Atlantec BioEnergy Corporation (ABC) operates a pre-commercial (demonstration)
operational processing facility in Cornwall, Prince Edward Island. It opened in the spring of 2010
as part of a Sustainable Development Technology of Canada (SDTC) project which is designed to
showcase the various integrated components of the bio-refinery.
Feedstocks for Biodiesel
Biodiesel production facilities, both operational and demonstration, use the following feedstocks:
canola, soybeans, yellow grease, multi-feedstock, tallow, camelina and mustard. Predominant
feedstocks are canola and soybean. Canola works, it's proven, and its currently grown in Nova
Scotia, New Brunswick and Prince Edward Island agricultural production. While the biodiesel from
soybean oil is slightly more difficult to process compared to canola oil, it currently makes up a large
portion of the American biodiesel industry. The meal that is produced when the canola and
soybean seeds are crushed is high in protein and is a highly valued animal feed supplement.
The following information is provided from the Canola Council of Canada.
Source: http://www.canola-council.org/
In Canada, it makes sense to make biodiesel from canola because of important advantages:
Proven technology and demand

High oil content
Superior flow in cold weather
Oxidative stability
Quality standards
Carbon sequestration
Proven technology and demand

Canola biodiesel is already widely used in Europe, which is expected to produce more than
7.3 billion liters of biodiesel from vegetable oil in 2012. In the EU, rapeseed and canola are
the foundation feedstock for biodiesel.
High oil content
Canola produces more oil per unit of seed than other oilseeds. That means biodiesel
producers realize greater efficiencies from canola than seeds with lower oil contents,
notably soybeans.
Superior flow in cold weather
Canola oil has the lowest level of saturated fat. That helps canola biodiesel perform better
in cold weather. Canola biodiesel has a very low Cloud Point (the temperature at which
small crystals form in the fuel).
Type of Biodiesel
Cloud Point
Edible tallow
19C
Soybean
3C
Canola
-3C
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Oxidative stability
Canola oil has a low iodine value, which means it is more stable and less prone to
oxidation. This quality reduces the likelihood of corrosive acids and deposits that can
increase wear in engine fuel pumps and fuel injectors. The iodine value of canola oil is
114, versus more than 130 for soybean oil. However, it should be noted that oil with
an initially elevated iodine value will have lower iodine following the degradation
process. Also, the biodiesel pool will ultimately be a blend of different oils and the
combined properties could be very different than those of the individual oils. Finally,
different conversion technologies and additives can produce a stabilized biodiesel
that meets all the required attributes as dictated by ASTM D6751 the specification for
B-100.
Quality standards
All canola varieties grown in Canada meet oil content standards set by the Western
Canada Canola/Rapeseed Recommending Committee. This track record is the
foundation for developing biodiesel standards that will assure consistent quality to
Original Equipment Manufacturers, fuel suppliers and users. Our industrys
commitment to quality will help Canadian biodiesel makers avoid problems that have
been experienced elsewhere.
Carbon sequestration
Making biodiesel from canola helps to reduce greenhouse gases in more ways than
one. As it grows, canola helps to sequester carbon in the soil. The amount of carbon
released during production is limited by the reduced tillage practices commonly used
by growers. As more farmers begin to use biodiesel, the energy balance for canola
biodiesel only improves.
Canola Supply Requirement Example
1 bushel (24kg) of canola
= 11 litres of oil
~ 60,000 acres of canola would be required to supply 1

provinces need (i.e. Nova Scotia needs) in terms of
meeting the legislated RFS requirements at 2%.
Other Feedstocks
As previously stated, production facilities will ultimately decide what the most appropriate
feedstock is, based on return on investment. When considering policy regarding feedstock its best
to consider production of biofuels as feedstock agnostic.
Mustard and camelina can be grown in the region, but their success as a feedstock will be relative to
the desire of production facilities to use them over other feedstock supplies, or perhaps used as
options, in multiple feedstock plant designs. Yellow grease and tallow is obviously available in this
region. SF Rendering of Nova Scotia (http://www.sfrendering.ca/ ) for example, has a biodiesel
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APRI No. 200344
production facility on site that can make up to 2 million litres per year of biodiesel at the rending
plant. Rothsay Biodiesel (http://www.rothsaybiodiesel.ca/our_biodiesel.html ) is another example
of an existing biodiesel production facility from animal fats and recycled cooking oil. There are
biodiesel proponents in New Brunswick currently considering supply of the 2% content for
biodiesel from waste cooking oil. Research on this is currently underway and exact data is not yet
available for the production of this report.
Continued investment in research regarding possible feedstock for biofuels production is
important. For the immediate production facility potential, there are feedstocks that work now that
are used by others, proven by others, and provide the best possible return on investment form the
point of view of the investors, owners and operators of biofuels production facilities throughout
Canada.
Consideration of Non-Agricultural Feedstock for the Region

Green Diesel
Renewable diesel or green diesel is different from traditional biodiesel where the latter is usually
esterified fats and oils and the former is usually produced through hydrotreatment of fats and oils.
Green diesel is an option to meet the 2% blend requirement of the Canadian Renewable Fuels
Regulations. If green diesel is not produced locally or regionally, refineries have no option but to
import green diesel from other parts of the world and blend it here for distribution and sale.
Only Neste Oil and Dynamic Fuels are currently producing green diesel at scale (in the US). While
biodiesel typically has a co-product (like crude glycerine), which sometimes is a troublesome
oversupplied commodity for biodiesel producers, green diesel on the other hand has by-products
such as green naptha and LPG (liquefied petroleum gas). In the case of Neste's production, byproducts include biogasoline, biogas and water. One of the advantages of green diesel is that it can
be produced at a lower operating cost than biodiesel using a variety of feedstock options (including
forestry feedstocks in this region). Aside from having feedstock flexibility for most green diesel
producers/developers, the oxidative stability of green diesel is also equivalent to petroleum diesel
meaning distributors do not need any special precautions or handling/dispensing to customers.
CelluFuel Inc. and Groupe Savoie, both members of ACBC, show specific interests for renewable
diesel production facilities in the near future, holding promise for the opportunity of this feedstock
in Atlantic Canada.
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Stakeholders in Atlantic Canada

As identified through ongoing engagement by ACBC, BioAtlantech and its affiliates, there is a large
community of serious and committed stakeholders around biofuels, biomass and biogas in Atlantic
Canada.
Project managers corresponded with these stakeholders throughout the duration of this project,
soliciting information to be used as reference for positions and assumptions in this report, and to
support its findings and recommendations. The primary source of feedback was a survey, sent
directly to a total of 120 stakeholders throughout Atlantic Canada, made available in both electronic
and printed formats, as well as both English and French languages.
Stakeholder Survey Results

A total of 49 stakeholders responded to the survey; further examination identified some of the
returned surveys were filled out by one representative of a company or organization that actually
fulfilled the response of two or more requests for survey response, reducing the number of
different stakeholder responses to 43. This equals a 36% response rate, which provides an
adequate cross section of information from stakeholders throughout New Brunswick, Prince
Edward Island and Nova Scotia, as well as input from Newfoundland. It includes biofuels, biogas
and biomass proponents and producers, research, academia, industry affiliates, the forestry sector,
agriculture, manufacturers, engineering, fuel distributors, and more. Research tells us, and industry
is also very clear, that there is much cross-over and synergy in the three communities of industry
biofuels, biogas and biomass.
Survey responses that speak directly and specifically to biogas and biomass are not reflected in this
report, but will be accessed at a later date for projects in those fields; the information provided here
is relevant to the biofuels industry development and the primary purpose of this report.
A list of all surveyed stakeholders and the detailed results are included as Appendix A of this report.
In summary, the responses highlighted:
Areas of interest in relationship to biofuels namely ethanol, biodiesel and renewable

diesel. Survey data shows approximately 11 bioenergy producers/proponents currently
operating in Maritime Canada: 2 producers of ethanol, 4 of biogas and 1 biodiesel producer.
Its likely these numbers are low based on a 36% survey response rate.
There are several proponents of both biofuel products, and no doubt the desire, ability and
will for local/regional producers to deliver the desired quantity and quality that this region
can consume and export. These producer proponents are confident that under the right
circumstances they will invest and deliver a viable commercial biofuels industry here. The
identified right circumstances will be highlighted below under Policy and Programming
and in greater detail in the recommendations section of this report.
Hurdles & Challenges in relation to the development of a viable sustainable biofuels

production industry, including:
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APRI No. 200344
Time and cost for research and development.

Lack of regional government knowledge of the industry.
Lack of government policy in the region. However, stakeholders recognize that
government policy also needs to be driven from industry interest, recommendation and
participation. There is no doubt a chicken and egg circumstance here in terms of
government policy and industry opportunity.
High capital cost for production plants.
Financing - funding for renewable energy. Because of the risk and considerable cost
involved, traditional lenders do not tend to support clients with new projects that are
uncommon in the region.
Supply of natural gas, or high cost of energy for production.
Feedstock development to commercialization.
Is there enough sustainable feedstock?
Policy and Programming (P&P). All participants were asked if they believe government(s)
could and should assist in the development of a biofuels production industry in this region.
Common responses included:
Biofuel mandates for NS, NB and PEI to support the new Government of Canada
Renewable Fuels Regulations. Nova Scotia, for example, has a current motor fuel tax
elimination for biofuel, yet has no mandate.
Government assistance for research and development.
Need for a level playing field with P&P in other Canadian jurisdictions and abroad.
Production incentives.
Encourage utilization of forest industry waste.
Policies in place regarding government fleet vehicles.
1) Additional quotes and comments of note retrieved through the survey process:
1) Believe industry holds great promise four our region
2) P&P Facilitate development, purchase agreements for bio-energy, create enabling
3)
4)
5)
6)
7)
8)
9)
environment.
P&P Educate the public on the benefits of bioenergy
Hurdles with public perception of product value and use.
Regional / inter-provincial approach for P&P.
Current policy does not support local production.
Rally farmers and foresters
Absence of strong government commitment to getting off of fossil fuels
Yes government can assist, sharing the risk of development grant / loan guarantees,
reduced taxes, co-fund capital and R&D projects.
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APRI No. 200344
Stakeholders clearly identified three common themes:

1. Mandate = market. Yes there is a mandate for renewable fuels on a national scale that was
believed to blanket all of Canada including our region. However due to circumstances of
regional refineries, distribution and unique circumstances in Atlantic Canada, the region is
negatively positioned for industry development. Provincial mandates or repair to the
national mandate are paramount to ensure success for the producers and proponents of
this region.
2. Policy and Programming. We must be competitive with other jurisdictions within Canada
and around the world. Capital is a huge hurdle for an emerging industry of this magnitude.
In many if not all other jurisdictions where the biofuels industry has developed and
succeeded, some type of capital funding or loan option has been made available and utilized
by regional developers. Additionally, other jurisdictions have benefited from some type of
production or tax incentive, to allow proponents to succeed at producing.
3. Public and government awareness of this industrys benefits for this region, need to be
addressed.
4. Research and development funds need to be focused and committed to the development of
current and new technologies, both for production and feedstocks, for now and in the near
future.
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APRI No. 200344
BioEnergy/Biorefinery Research Network

ACBC, its membership, and BioAtlantech also continue to collaborate with academia and research
throughout Atlantic Canada. An informal Biorefinery/Bioenergy research network was established
in 2011; to date, there are a total of 51 members who are building momentum for research and
development in this sector.
A complete list of members is included as Appendix B of this report. Its evident from this network
that there is significant research happening, directly and indirectly, on biorefineries and bioenergy.
While each of these researchers currently has adequate laboratory resources to conduct their
research, some strategic investments in infrastructure (equipment) could facilitate
commercialization efforts, and provide specific research support that currently does not exist.
A more complete research capacity and gap assessment survey should be completed within the
next year to identify specific needs of ACBC members as well as other bioenergy start-ups. Many of
the current research efforts by members of this group are not specifically focused on industry, or if
they are, they are not focused on the regional industrys needs (for example, some researchers are
working with large pulp and paper companies not located in the Atlantic Region). Many of these
researchers have also been conducting research in isolation of the others in the region, which leads
to project overlaps and provincial and federal investments similar projects. The main goal of the
research network is to help facilitate collaborations and reduce the duplication of research
activities. ACBC also hopes it can help focus research capacity on regional needs and industry
developments.
There are currently two research centres that have a mandate focused on applied research,
specifically for the regional bioenergy industry sector.
CCNB Biorefinery Technology Scaleup Centre
The Biorefinery Technology Scaleup Centre is an applied research centre associated with the
College Communautaire de Nouveau Brunswick. Its mandate is to work directly with the private
sector. Its infrastructure capacity and expertise is focused on the pilot scale demonstration and
technical support for ethanol, biodiesel and biogas bioenergy processes.
The centre has received investments from ACOA ($1.2 million), the Province of New Brunswick ($1
million) and NSERC Community College Innovation Program ($2.2 Million). These investments
have contributed to the development of Atlantic Bioenergy Corp of PEI; Maritime Biofuels of Nova
Scotia; and Laforge Bioenvironmental of New Brunswick. Each of these companies is also members
of ACBC.
The centre has also played a major role in the founding of ACBC and the organization of the
Biorefinery Research Network. In addition to its own capacity and expertise it assists companies in
identifying and obtaining research and technical expertise from other researchers in the region,
nationally and internationally.
The Centre can access various funding programs both nationally (NSERC and NRC-IRAP) and
Provincially (New Brunswick Innovation Foundation) that can assist company research and
development.
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APRI No. 200344
CBU Centre for Sustainability Energy and the Environment (Verschuren Centre)
Cape Breton Universitys Verschuren Centre for Sustainability in Energy and the Environment was
established to find innovative and sustainable solutions to energy and environmental issues. The
Verschuren Centre is committed to innovative solutions to increase the value of community
renewable energy sources, both locally and globally.
The Verschuren Centre has a focus on biomass-based renewable energy and bio-products, the
combination of which it believes will optimize the socio-economic benefit of available biomass
resources. The Centre believes that industrial scale biomass feedstock development is critical to
both commercial pathways renewable energy and bio-products. Such feedstocks include a variety
of sources and uses, including:
4)
5)
6)
7)
Municipal Solid Waste (MSW) for biomass combined heat and power generation;
Forestry resource to co-produce forestry products and cellulosic biofuels;
Non-food agricultural crops for nutriceuticals, pharmaceuticals, and biofuels; and
Algae (seaweed) for cosmetic products, food and bioenergy.
Cape Breton University is creating a living laboratory for research, development, demonstration
and commercial deployment of bio-product and bioenergy technologies and processes, as
evidenced by a focus on biomass gasification. They are currently considering the establishment of a
biomass gasification commercial-scale demonstration facility, including research and development
partnerships with Lockheed Martin and Cape Breton Explorations, that will further the
development agenda of the technology and its economic use with various feedstocks.
The Centre believes Atlantic Canada has a competitive advantage for bioenergy sector and that
policy and legislation can help foster commercial development. Moving forward, the Centre will
continue to collaborate with industry, academia and government on commercialization-focused
research and development designed to foster the advantages in this region.
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Market Capacity
According to the Canadian Renewable Fuels Association (CRFA), there are currently seven
commercial-scale biodiesel producing plants in operation in Canada, accounting for approximately
118 million litres per year in production. There are two additional large-scale plants under
proposal, however far from completion and production: ADM is proposing a 200 ML plant in
Alberta, and Greefields is proposing a 175 ML plant in Quebec. Other plants are under construction,
mostly in the Prairie Provinces. When considering all these biodiesel plants, the Canadian biodiesel
industry would have a total production capacity of 600 million litres. Sources:
http://www.greenfuels.org/en.aspx, Senate Committees Reports http://www.parl.gc.ca/sencommitteebusiness/CommitteeReports.aspx?parl=41&ses=1&Language=E&comm_id=2
CFRA figures show the current Canadian production capacity meets only 85% of those standards,
and that Canadas target number of 600 ML is still well below the anticipated demand of Renewable
Fuels Standards. The renewable fuels regulations currently in place, and their forecasted demand,
will increase domestic biodiesel production and the demand for renewable fuel, from 583 million
litres in 2011 to 858 million litres in 2035. It is assumed that the majority of the renewable fuel
demand would be met through domestic production. As that demand increases, it is reasonable to
assume that additional production facilities would join the market.
The Canadian Environmental Protection Act (1999) states the following in its Regulations Amending
the Renewable Fuels Regulations, P.C. 2011-795 June 29, 2011:
In addition to the overall environmental benefits, one of the key drivers for supporting
renewable fuels production and use is the benefit that it can bring to the agriculture sector and
rural Canada. Increased renewable fuels production in Canada will result in increased local
demand for feedstocks and new markets for Canadian agricultural producers crops. For
example, biodiesel facilities can provide a market for off-grade canola, which is not suitable for
the food market.
Providing agricultural producers with the opportunity to invest in and develop profitable
renewable fuels projects that use agricultural products as inputs will help to create a positive
stream of income that could be more independent of commodity price swings. This would also
encourage an approach that goes beyond simple commodity production to focus on new ways
to add value to biomass produced on farms. Renewable fuel plants would inject additional
spending into the local rural economies, broadening their tax base and generating additional
jobs at the local level.
SOR/2011-143 June 29, 2011
The CRFA has also made clear the intention to further increase the requirements of the renewable
fuels standards, moving from a 5% blend to 10%, which would double demand. The U.S. is further
considering an increase to a 15% blend; if and when that happens, Canada would likely follow in
the same direction. There is no current urgency to move to a 10% blend, because industry does not
yet have the capacity to keep up, and moving too quickly would only drive the need to import
biofuels. Progress must be scaled to the pace that Canadian production capacity can be built.
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APRI No. 200344
To increase the availability of biofuel in Canada, the Federal government initiated an ecoENERGY
for Biofuels Program, which supports the production of renewable alternatives to gasoline and
diesel, and encourages the development of a competitive domestic industry for renewable fuels.
The program, administered by NRCan, is investing $1.5 billion over nine years, to assist with
creating biofuels plants across Canada. Funds for this program are currently fully expended. The
entire sum of incentives was granted to producers in central and western Canada; Atlantic Canada
received zero incentives. But, the CRFA continues to lobby government for continued access to this
program, to allow new applications as well as re-applications from proponents originally rejected.
Atlantic Canada could significantly benefit from application for this program. In addition to the
ecoENERGY program, several provinces in Canada have specific production incentives for biofuel
producers.
Market capacity can best be determined by actual and future demands, and it is clear that the
current production market in Canada does not, and cannot, meet those demands. This market is
growing at a significantly fast pace, leaving considerable room for new biodiesel production
facilities.
Current Renewable Fuel Facilities across Canada

A map of biofuels facilities across Canada provides a picture of the potential for the bioenergy
market in Atlantic Canada.
The below map indicates the location of all renewable fuels producing companies in Canada, and
the corresponding table lists each plants nameplate capacity, the type of product produced and the
feedstock used is included.
Source: http://www.greenfuels.org/en/industry-information/plants.aspx November 2010
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APRI No. 200344
Biodiesel
In million litres per year (Mmly)

Plant Name
City
Province
Feedstock
Capacity
Status
1 Bifrost Bio-Blends Ltd.
Arborg
Manitoba
Canola
3 Mmly
Operational
2 Biocardel Quebec Inc.
Richmond
Quebec
Multi-feedstock
40 Mmly
Proposed Plant
3 Bio-Lub Canada.com
St-Alexis-desMonts
Quebec
Yellow grease
10 Mmly
Operational
4 BioStreet Canada
Vegreville
Alberta
Oilseed
237 Mmly
Proposed Plant
5 Bioversel Sarnia
Sarnia
Ontario
Multi-feedstock
170 Mmly
Proposed Plant
6 BIOX Corporation
Hamilton
Ontario
Multi-feedstock
66 Mmly
Operational
7 BIOX Corporation
Hamilton
plant 2
Ontario
Multi-feedstock
67 Mmly
Proposed Plant
8 Canadian Bioenergy
Corporation - North
Biodiesel Limited
Partnership
Lloydminster
Alberta
Canola
265 Mmly
Proposed Plant
9 City-Farm Biofuel Ltd.
Delta
British
Columbia
Recycled oil/tallow
10 Mmly
Operational
10 Consolidated Biofuels
Ltd.
Delta
British
Columbia
Yellow grease
10.9 Mmly
Operational
11 Eastman Bio-Fuels Ltd.
Beausejour
Manitoba
Canola
5 Mmly
Operational
12 FAME Biorefinery
Airdire
Alberta
Canola, camelina,
mustard
1 Mmly
Demonstration
Facility
13 Kyoto Fuels Corp
Lethbridge
Alberta
Multi-feedstock
66 Mmly
Under
Construction
14 Methes Energies Canada

Inc.
Mississauga
Ontario
Yellow grease
5 Mmly
Operational
15 Methes Energies Canada

Inc.
Sombra
Ontario
Multi-feedstock
50 Mmly
Under
Construction
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APRI No. 200344
Plant Name
City
Province
Feedstock
Capacity
Status
16 Milligan Bio-Tech Inc.
Foam Lake
Saskatchewan
Canola
1 Mmly
Operational
17 Noroxel Energy Ltd.
Springfield
Ontario
Yellow grease
5 Mmly
Operational
18 QFI Biodiesel Inc.
St-Jeand'Iberville
Quebec
Multi-feedstock
5 Mmly
Operational
19 Rothsay Biodiesel, A
member of Maple Leaf
Foods Inc.
Montreal
Quebec
Multi-feedstock
45 Mmly
Operational
20 Speedway International
Inc.
Winnipeg
Manitoba
Canola
20 Mmly
Operational
21 TRT-ETGO
Bcancour
Quebec
Vegetable oil
100 Mmly
Proposed Plant
22 Western Biodiesel Inc.
Calgary
Alberta
Multi-feedstock
19 Mmly
Operational
Ethanol
In million litres per year (Mmly)

Plant Name
City
Province
Feedstock
Capacity
Status
23 Alberta Ethanol and

Biodiesel GP Ltd.
Innisfail
Alberta
Wheat
150 Mmly
Proposed Plant
24 Amaizelingly Green
Products L.P.
Collingwood
Ontario
Corn
58 Mmly
Operational
25 Atlantec Bioenergy
Corporation
Cornwall
PEI
Energy beets
300,000ly
Demonstration
Facility
26 Enerkem Alberta
Biofuels - Edmonton
Waste-to-Biofuels
Facility
Edmonton
Alberta
Municipal solid waste

(landfill waste)
36 Mmly
Under
Construction
27 Enerkem Inc.
Sherbrooke
Quebec
Various feestocks
475,000
Litre/y
Demonstration
Facility
28 Enerkem Inc.
Westbury
Quebec
Wood waste
5 Mmly
Demonstration
Facility
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APRI No. 200344
Plant Name
City
Province
Feedstock
Capacity
Status
29 GreenField Ethanol Inc.
Chatham
Ontario
Corn
195 Mmly *
Operational
Johnstown
Ontario
Corn
230 Mmly
Operational
Tiverton
Ontario
Corn
27 Mmly *
Operational
Varennes
Quebec
Corn
155 Mmly
Operational
33 Growing Power Hairy

Hill
Hairy Hill
Alberta
Wheat
40 Mmly
Proposed Plant
34 Husky Energy Inc.
Lloydminster
Saskatchewan
Wheat
130 Mmly
Operational
35 Husky Energy Inc.
Minnedosa
Manitoba
Wheat and corn
130 Mmly
Operational
36 IGPC Ethanol Inc.
Aylmer
Ontario
Corn
162 Mmly
Operational
37 Iogen Corporation
Ottawa
Ontario
Straw from wheat,

barley, and oats
2 Mmly
Demonstration
Facility
38 Kawartha Ethanol
Havelock
Ontario
Corn
80 Mmly
Operational
39 NorAmera BioEnergy
Corporation
Weyburn
Saskatchewan
Wheat
25 Mmly
Operational
40 North West Terminal

Ltd.
Unity
Saskatchewan
Wheat
25 Mmly
Operational
41 Permolex International,
L.P.
Red Deer
Alberta
Wheat, wheat starch,

corn, barley, rye &
triticale
42 Mmly
Operational
42 Pound-Maker
Agventures Ltd.
Lanigan
Saskatchewan
Wheat
12 Mmly
Operational
43 Suncor St. Clair Ethanol

Plant
Sarnia
Ontario
corn
400 Mmly
Operational
44 Terra Grain Fuels Inc.
Belle Plaine
Saskatchewan
Wheat
150 Mmly
Operational
* Volumes include industrial alcohol production
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APRI No. 200344
The Potential for Advanced Bioenergy Technology in Atlantic Canada

There are several companies with potential for the next generation of biofuels production in
Atlantic Canada, already using new technologies such as wood waste, algae and municipal waste
that could be effective and sustainable opportunities for biofuels industry development. All cities,
for example, have municipal waste and are looking for strategic partners to manage and find
alternative uses for that waste.
Cellulosic or Advanced Biofuels
In the United State; according to the summary section of the Congressional Research Service (CRS)
Report to Congress, dated October 14, 2010:
Cellulosic biofuels are produced from cellulose (fibrous material) derived from renewable
biomass. They are thought by many to hold the key to increased benefits from renewable
biofuels because they are made from potentially low-cost, diverse, non-food feedstocks.
Cellulosic biofuels could also potentially decrease the fossil energy required to produce ethanol,
resulting in lower greenhouse gas emissions.
Cellulosic biofuels are produced on a very small scale at this time---significant hurdles must be
overcome before commercial-scale production can occur. The renewable fuels standard (RFS),
a major federal incentive, mandated the use of 100 million gallons per year (mgpy) of cellulosic
biofuels in 2010. After 2015, most of the increase in the RFS is intended to come from cellulosic
biofuels, and by 2022, the mandate for cellulosic biofuels will be 16 billion gallons. Whether
these targets can be met is uncertain, and on March 26, 2010, the Environmental Protection
Agency issued a final rule that lowers the 2010 cellulosic biofuel mandate to 6.5 million gallons.
Research is ongoing, and the cellulosic biofuels industry may be on the verge of rapid expansion
and technical breakthroughs. However, at this time, only a few small refineries are scheduled
to begin production in 2010, with an additional nine expected to commence production by 2013
for a total output of 389 mgpy, compared with an RFS requirement of 500 mgpy in 2012 (a
year earlier).
The federal government, recognizing the risk inherent in commercializing the new technology,
has provided loan guarantees, grants, and tax credits in an effort to make the industry
competitive by 2012. In particular, the Food, Conservation, and Energy Act of 2008 (the 2008
farm bill, P.L. 110-246) supports the nascent cellulosic industry through authorized research
programs, grants, and loans exceeding $ 1 billion. The enacted farm bill also contains a
production tax credit of $1.01 per gallon for ethanol produced from cellulosic feedstock.
Private investment, in many cases by oil companies, also plays a major role in cellulosic biofuels
research and development.
Three challenges must be overcome if the RFS is to be met. First, cellulosic feedstocks must be
available in large volumes when needed by refineries. Second, the cost of converting cellulose
to ethanol or other biofuels must be reduced to a level to make it competitive with gasoline and
corn-starch ethanol. Third, the marketing, distribution, and vehicle infrastructure must absorb
the increasing volumes of renewable fuel, including cellulosic fuel mandated by the RFS.
Congress will continue to face questions about the appropriate level of intervention in the
cellulosic industry as it debates both the risks in trying to pick the winning technology and the
benefits of providing star-up-incentives. The current tax credit for cellulosic biofuels is set to
expire in 2012, but its extension may be considered during the 111 th Congress. Congress may
continue to debate the role of biofuels in food price inflation and whether cellulosic biofuels can
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APRI No. 200344
alleviate its impacts. Recent congressional action on cellulosic biofuels has focused on the
definition of renewable biomass eligible for the RFS, which is considered by some to be overly
restrictive. To this end, legislation has been introduced to expand the definition of renewable
biomass eligible under the RFS.
The interest, desire and planned development of new technologies or improved existing
technologies is an important factor for future industry development in the United States, and
around the world. Policy and strategy that evolves in the U.S. will have a direct impact on industry
development in Canada
While the U.S. recognizes it is currently an economic stretch, they are committed to development to
improve its profitability. This same desire exists with SDTC in Canada. Striving towards biofuels
production that meets U.S. cellulosic biofuels standards or acceptance for imported Canadian
biofuels provides a great opportunity for Atlantic Canada proponents.
For further reference, an article supporting the case for cellulosic ethanol is attached as Appendix C
of this report.
Algae to Biofuels
The production of biofuel from algae involves three basic steps: algae growth, biomass extraction,
and post processing.
In the first stage of large scale algae biofuel production, algae are grown in a network of bioreactors
on an agricultural scale. The bioreactor network is designed and constructed to provide the optimal
growing conditions, and allowing for efficient harvest of algae at the end of each growing cycle.
Pond Biofuels enclosed reactors protect the algae from environmentally adverse conditions and
maintain the integrity of the algae crop.
Algae are harvested to yield the energy rich biomass, and the aqueous nutrient broth returned to
the bioreactor network in a closed loop system. Collected biomass is then processed through
several mechanical, drying, and chemical steps to yield the final biofuel product. Biocrude oil may
be separated from dry algae biomass, and the biocrude prepared for subsequent processing into
biofuel. In either case, finished biomass is suitable as a direct substitute for coal, petcoke and
related fossil fuels. If extracted from the biomass, biocrude may be further processed into biodiesel
in the third step through a chemical process that results in biodiesel that meets the appropriate
regulatory standards for use in the existing fuel distribution system.
In July 2010 ExxonMobil and Synthetic Genomics Inc. announced opening of a new greenhouse
facility to enable the next level of research and testing in algal biofuels. This new facility will
support the evaluation of most productive strains of algae and most efficient production methods
and potentially result in economically viable, low net carbon emission transportation fuel. As stated
in its release to media:
This is an important day in the early stages of our development program as we test the
hypothesis that algae biofuels could become commercially viable and make a meaningful
contribution to meeting future energy demand
SGI and ExxonMobil researchers are using the facility to test whether large-scale quantities of
affordable fuel can be produced from algae.
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APRI No. 200344
In the greenhouse facility, researchers from ExxonMobil and SGI will examine different growth
systems for algae, such as open ponds and closed photo-bioreactors. They will evaluate various
algae, including both natural and engineered strains, in these different growth systems under a
wide range of conditions, including varying temperatures, light levels and nutrient
concentrations. They will also conduct research into other aspects of the algae fuel production
process, including harvesting and bio-oil recovery operations.
Since ExxonMobil and SGI announced the algae biofuel program last July, researchers have
made substantial progress, including:
Isolating and/or engineering a large number of candidate algal strains and developing growth
conditions under which these strains could be made more productive;
Identifying and testing some of the preferred design characteristics of the different production
systems; and
Initiating life cycle and sustainability studies to assess the impact of each step in the process on
greenhouse gas emissions, land use and water use.
An additionally attractive factor for Atlantic Canadian biofuels production is development at Ocean
Nutrition Canada (ONC) and a possible spin-off company to produce algae to biofuels. As stated in
its 2010 media release
Dozens of companies and academic laboratories are pursuing the objective Ocean Nutrition
Canada did not know it had to cultivate algae, the foundation of the marine food chain, as a
source of green energy.
But Ocean Nutrition Canadas prolific grower, experts say, appears capable of producing oil at
a rate 60 times greater than other types of algae being used for the generation of biofuels.
In view of its discovery, the company will lead a four-year consortium, formed over the past
months and funded by the federal not-for-profit foundation Sustainable Development
Technology Canada, to develop its proprietary organism into a commercial-scale producer of
biofuels.
Canada, with its long harsh winter and short summer, would hardly seem to be the ideal place
to breed algae for biofuel
Capable of converting sunlight and carbon dioxide into lipids and oils, photosynthetic algae can
typically generate 10 to 20 times more fuel per acre than agricultural commodities like corn,
used to make ethanol.
Moreover, algae do not require arable land and so need not compete with food crops for
growth space. And as voracious consumers of carbon dioxide, photosynthetic algae have the
potential to abate greenhouse gas emissions
Its a big deal for Eastern Canada and a big deal for the country in general, Mr. Whittaker
said. Because of this particular algae strain and our ability to process it, this can reach a
global scale.
Ocean Nutrition is now capable of growing meaningful amounts of the strain named ONC
T18 B and keeps a stockpile in cryogenic reserve. One of the specific draws is that it produces
oil by converting reduced organic compounds, not by conventional photosynthesis. Direct
sunlight is not always easy to come by in Canada, and heating indoor ponds could end up
consuming more energy than it produces.
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APRI No. 200344
This is a very real and exciting opportunity for Nova Scotia.

Maritime Biofuels provided ONC with the technology to convert the majority of this ONC byproduct to ASTM D6751 specification B-100 Biodiesel. Wilson Fuel Co. Limited current leases
5MML of bulk tank storage in their Halifax bulk terminal to MBP. WFC also provide MBP with
access to the Barrington Terminal pipeline, which is used to load tankers to move the ONC/MBP
product to European markets.
Conventional algae are typically photoautotrophic, getting free energy from the sun. Because the
ONC algae is instead heterotrophic, it draws energy from sugars, which are not a free energy
source and would result in a higher input cost; but, this is expected to be balanced by the higher
conversion rate to oil.
Recently, May, 2012 Ocean Nutrition Canada was purchased by a Dutch group, Royal DMS. The
future of the proposed biofuels project is unknown at this time, yet the opportunity clearly still
exists.
Hydrogenated Vegetable Oil
Another consideration for biodiesel production in North America is the blending of hydrogenated
vegetable oil (HVO) with diesel, through a process called hydro treatment, which makes a diesellike fuel from the hydrogenation and de-oxygenation of vegetable and animal based oils.
Hydro treatment typically conducted in an oil refinery. The feasibility of using hydrotreatment to
produce renewable diesel is very sensitive to economies of scale. Some argue that the best place to
hydrotreat oils is in the refinery itself, which would require the refinery to capitalize the process
modifications necessary to produce the product.
Environment Canada has this to say:
It can also be seen in both the West and the East, that some volumes of HVO would be used.
Higher volumes of HVO would be blended in the West, due to greater accessibility of the
product in that region. In addition, blenders in the West are already using HVO to meet
provincial requirements and therefore already have the necessary infrastructure and planning
to deal with HVO. This product is desirable due to its high cetane number and low cloud point
relative to biodiesel (can go to 25C). It is currently produced in relatively low quantities and
must be transported long distances (from Singapore, Finland, the Netherlands and the United
States to a certain extent), rendering it costly. The volumes of HVO used to calculate the costs
and the average differential cost of 35 cents per litre between HVO and diesel fuel were
provided by the industry. The total incremental cost of the imported HVO over the 25-year
period is estimated to be $764 million.
Some fuel producers are or have been investigating the possibility of producing HVO
themselves, but have also indicated that the capital costs remain too high. Most producers
would prefer to blend with HVO, but current availability and prices of the product render it
inaccessible at this time.
Atlantic Canadas two refineries Irving Oil and Imperial Oil have indicated interest in
Hydrogenated Vegetable Oil (HVO) and suggest this consideration would help reduce costs for
infrastructure and distribution in relationship to diesel. However, they did not provide in-depth
feedback, nor did they seemed convinced this is an option of choice in the short term.
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APRI No. 200344
ACBC strongly believes that next generation biofuels are a very real opportunity for the Atlantic
region. These kinds of technologies are being used in other jurisdictions, where there is access to
capital funding, production incentives and mandates for market supply and demand. (For reference,
a list of facilities in Canada, using a diverse group of feedstocks for cellulosic biofuels energy
beets, wood waste, switch grass corn cobs, corn residue, wheat and wheat straw, municipal waste,
treated wood and agricultural waste, is included as Appendix D of this report.)
Atlantic Canadian companies ready to use technological advancements for biofuels production
would benefit from similar policy and programming efforts to help them reach their full potential.
Case studies of companies currently operating with these technologies, and the opportunities for
future potential, are detailed in Appendix E of this report.
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APRI No. 200344
The Atlantic Canada Opportunity Regional Consumption and Export Capacity

Canadian RFS now require ethanol blends. Based on the standards set in the national mandate, the
below chart represents the biofuels production potential for Atlantic Canada.
L
5% Blend Ethanol
10% Blend Ethanol
Motor gasoline
1.195 BL
59 MML
118 MML
Diesel Fuel Oil
889 MML
18 MML
Heating Oil
904 MML
18 MML
Nova Scotia Fuel Energy
New Brunswick Fuel Energy
5% Blend Ethanol
Motor gasoline
1.129 MML
56 MML
Diesel Fuel Oil
1.189 MML
24 MML
317 MML
6 MML
Heating Oil
PEI Fuel Energy
10% Blend Ethanol
112 MML
5% Blend Ethanol
Motor gasoline
230 MML
11.5 MML
Diesel Fuel Oil
132 MML
3 MML
Heating Oil
192 MML
4 MML
Newfoundland Fuel Energy
10% Blend Ethanol
23 MML
5% Blend Ethanol
10% Blend Ethanol
Motor gasoline
670 MML
33.5 MML
67 MML
Diesel Fuel Oil
521 MML
10.42 MML
Heating Oil
611 MML
12.22 MML
Source: Natural Resources Canada. (Latest statistics 2008 note average 2004 to 2008 is reasonably constant)
Note on Ethanol: Canadian RFS regulate a 5% blend; however, the standard or common blending amount is currently at 10%, therefore
assumptions of provincial blending requirements are based on a 10% blend.
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For NS, NB and PEI this represents approximately 253 ML Ethanol and 73 ML Biodiesel & home
heating combined, which equals just over 300 ML of product for domestic consumption, in order to
meet the regulations set out in the Canadian RFS.
Unfortunately, this region is not producing its 300 ML of product, but is instead importing some of
that quantity, sending economic and environmental benefits elsewhere. In the province of Nova
Scotia, the distribution of fuel is generated primarily through a single refinery, and in this case
based on geography and national refinery locations, this refinery can meet its national obligation of
blending by doing so in other regions of the country. This makes Nova Scotia the only province in
Canada other than the locations originally exempt from the national standard that does not
blend ethanol in its gasoline pool. This is not strategic or beneficial for Nova Scotian consumers,
nor was it likely the original intention of the national standard to provide a circumstance resulting
in this kind of regional loop hole.
Mandate clearly equals market; this region has the opportunity to build its industry in order to
produce the 300+ ML required just to meet nationally mandated standards, and to reap the
economic and environmental benefits.
Additional export sales would also be available for Atlantic producers. Saskatchewan, for example,
only has 1 million people, yet currently produces approximately 350 ML of biofuels to meet both
domestic and export needs.
It is also anticipated that Canadian blending requirements for both fuels will increase and follow
the lead of other jurisdictions like the USA, South America and Europe, moving from 5% to 10% and
then 15% for ethanol and 2% to 5% for biodiesel and beyond.
Considering all these factors, the potential for biofuels production in NS, NB and PEI, for domestic
consumption and export could have a realistic target of over 500 or 600 million litres.
A Growing Market
According to the CRFA, the industry has invested $2.3 billion towards the construction of new
production facilities across the country, generating almost 2 billion litres per year of domestic
production capacity. This is a significant amount, though still only 2% of biofuels produced
worldwide and only 4% of U.S. production. In other words, there remain tremendous opportunities
for growth.
Energy can probably be defined as one of biggest challenges of the 21st century. Many experts
anticipate global supply will tighten in the years ahead, and that energy prices will inevitably
escalate. The International Energy Agency (IEA) is predicting a 40% increase in global crude
demand by 2030.
The worlds population is expected to grow by approximately 50 percent before stabilizing later
this century. The pressures to expand food and energy production while simultaneously reducing
our carbon emissions and preserving ecosystem services is expected to create many conflicts
concerning land use and agricultural practices.
World markets including the U.S. suggest that mandates currently in place provide the when and
where of a 60 billion gallon (and up) biofuels market by 2022 but can the capacity be built?
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In Florida, the Digest released its annual review of biofuels mandates and targets from 52 countries
around the world. The bulk of mandates come from the EU-27, where the Renewable Energy
Directive (RED) specifies 10% renewables content by 2020 across the entire membership though
7% of that will come from biofuels, the balance from the electrification of the fleet. The other 21
countries are primarily in Asia.
Besides the EU, the major blending mandates that will drive global demand are those set in the U.S.
China and Brazil each of which has set targets or, in the case of Brazil, is already there at levels
in the 15-20% range by 2020-2022. Indias fast-growing economy also has a 20% ethanol mandate
in place for 2017, but the country has a shaky record of implementing mandates, so far.
The major biofuels mandates with some estimates of 2020 consumption, translate into the major
drivers of the 60 billion gallons of global biofuels demand that are widely discussed, without
addressing the demand for aviation, or the mandates in place in countries such as Canada, Australia,
or throughout Southeast Asia.
The U.S. continues to push toward a 15% blend for ethanol. Although there have been delays in
implementation, new cars, E85 capabilities, and continued effort by the U.S. Renewable Fuels
Association will make every effort to make this a reality in the near future.
As previously mentioned in this report, the current Canadian production capacity for ethanol in
Canada meets only 85% of the RFS demand. Additional capacity is already required to meet
provincial mandates that go above the 5% for ethanol and the 2 % for biodiesel, in provinces
including British Columbia (5% mandate for biodiesel), Saskatchewan (7.5% mandate for ethanol)
and Manitoba (considering 5% mandate for biodiesel).
Even the target of 600 ML of biodiesel is well below the RFS demand, leaving considerable room for
growth in Canadian biodiesel production facilities. One would likely have to consider that the
Canadian Renewable Fuels Association and industry development will follow the lead of the U.S, at
some point moving to a 15% RFS in Canada, which would triple the demand and create opportunity
for rapid expansion in the industry.
The Canadian Canola Growers Association identifies a huge market growth potential for biodiesel,
and intend to move from a 2% to a 5% mandate. They offer the following comments on canola
feedstocks:
A cleaner-burning alternative for diesel fuel
Made from canola oil, a natural, renewable resource
Can be used in any regular diesel engine with no modification
Viable alternative for on-road vehicles, from municipal fleets to long-haul trucks, as
well as off-road equipment used for mining, forestry, construction, agriculture and
marine industries
Can be used in its pure form (B100) or mixed with petroleum diesel
Not the same as ethanol, which is an alternative to gasoline
Would drive the growth of jobs, investment and research, particularly in Western
Canada
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Every $100 million of additional demand for canola generates $83 million in Canadian
Gross Domestic Product and more than 730 direct jobs in value-added industries
Used by more than 20 major fleets in Canada and 500 major fleets in the U.S.
3.5 million litres of biodiesel used in Canada in 2004
Canadas new requirement for 2% renewable content in diesel fuels will increase the
need to 600 million litres
A 5% renewable content requirement would push the need to 1.3 billion litres
Despite many recent market changes in North America and around the world, the growth rate for
the biofuels industry is expected to be high, and industry will need to develop quickly to keep pace.
To complete the concentration of regional and national production and demand, provincial
governments in Atlantic Canada will need to work with the Federal Government and Atlantic
Canada industry to ensure that the gaps or flaws in the national renewable fuels regulations are
repaired in order to provide the maximum market potential for the Atlantic biofuels industry. In
August of 2012, ACBC initiated this discussion by way of letters to the Federal Minister of the
Environment and the Federal Minister of Agriculture and Agri-Food, with ccs to all Atlantic
Premiers and selected government officials. A copy of this letter is included as Appendix F.
It is also important to note, as part of the domestic market discussion, that ACBC continues to
engage both of Atlantic Canadas refineries Irving Oil and Imperial Oil who both indicate a
preference to receive their supply of biofuels from local, Atlantic Canada producers, rather than
import biofuels form outside of the region or Canada, in order to meet the Canadian RFS.
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RESEARCH ANALYSIS
The second major component of this project involved research.
First, a SWOT analysis, to evaluate the Strengths, Weaknesses, Opportunities and Threats involved
in developing a bioenergy industry for Atlantic Canada. Second, a look at the regions testing and
analysis capabilities to support this development, and the existing efforts of both researchers and
industry. And third, an analysis of policy and programming specific to this industry.
SWOT Analysis
Stakeholders have identified a number of internal and external factors that are favorable and
unfavorable to building a bioenergy sector in Atlantic Canada.
The SWOT analysis is based on the following definitions:
Strengths characteristics that provide it an advantage.
Weaknesses (or Limitations) characteristics that create a disadvantage
Opportunities: external factors in the environment that could improve performance (e.g.
make greater profits)
Threats: external factors in the environment that could cause trouble
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STRENGTHS
Significant & diverse biomass
Open territory - development, policy
and programming
Established lead agency
Strong research and academic
community
Existing producers, plants
Interested governments
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WEAKNESSES
Lack of awareness, understanding
Perception that region cannot deliver
volume
Behind industry pace
Federal funding spent
No strong government champion
Lackof experience as a sector
SWOT ANALYSIS
OPPORTUNITIES
Outside investment interest
Cellulosic capacity
Close proximity for export
Shared desire to end imports
Traditional industries (feedstocks)
available to support sector
Federal mandate for renewable fuels
production
Regional priority for economic
development and employment
THREATS
Current reliance on imported biofuels
Global economic challenges
Provincial governments face fiscal
constraint
Limited will for provincial mandates,
policy and programming
Resistance towards implementing RFS
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Strengths
Atlantic Canada is open territory for development in the biofuels industry, as well as
government policy and programming. With a blank page, this region can lean on the
experiences and knowledge of other jurisdictions
The region has a wealth of diverse biomass resources (crops and waste materials) and good
growing conditions for a diverse range of crops for example, energy beets which have 3
times the output per litres per acre than corn.
Irving Oil must blend its product to meet current RFS and would prefer to buy from local
producers.
Atlantic Canada is easily accessible by numerous seaports.
ACBC is well established as the lead Bioenergy Agency for Atlantic Canada; with 11
members, it lends a well-rounded voice to advocate for change in government policy. As a
group, they have begun working with both provincial and federal governments to help relay
information and provide recommendations that would support policy and programming to
benefit the region and the sector.
This report will be the first to provide actual economic impact analysis in order to facilitate
policy and programming decisions
The region has a strong regional research and academia community available to facilitate
research and development to support to the private sector, similar to other regions of
Canada. Prime examples include the already established Biorefinery Research Network and
the Biorefinery Technology Scale up centre that houses specific infrastructure and expertise
in ethanol, biodiesel and biogas production technology.
Atlantic Canada has existing and experienced producers, as well as qualified suppliers to
design and build biofuels plants.
There are already two existing pilot-scale ethanol plants in Atlantic Canada.
Government is interested and eager to understand the potential of this sector.
Weaknesses
Consumers, government, industry and the media are unaware of this sector and do not fully
understand its potential.
A lack of solid, structured government policy and programming around biofuels and
bioenergy to allow competition with other jurisdictions. Individual producers have
benefited from single policies, but stakeholders feel a need for region-wide policy and
programming for this sector.
Atlantic Canada is perceived as unable to deliver, both in feedstock and policy and
programming. Because volumes of crop production and the waste materials is much smaller
here than in other jurisdictions such as western U.S. and Canada, many believe there is not
enough resources to build an industry.
Atlantic Canada has unique challenges meeting Canadian RFS.
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Industry development is moving fast, and Atlantic Canada could get left behind. For
example, Ag Canada is already on the next phase of biofuels strategies and this region has
not yet started.
Federal programs of significant value already been all allocated and consumed by others.
There are no national mandates for renewables that provide opportunities for biogas (green
electricity or green natural gas) or solid biomass fuel (pellets) and currently no carbon
credit or credit trading system for Canada.
Regional refineries are lobbying against the implementation of renewable fuels regulations
for biodiesel.
Lack of a coordinated strategy and plan.
No strong government champion for this sector.
There are currently no large-scale, commercial biofuels producers in Atlantic Canada. (Two
bioenergy/biogas plants are operational).
The biofuels sector, as a whole, lacks experience.
The region has no formal relationship with the CRFA.
Opportunities
Outside investors and partners may be interested in investing here.
Cellulosic is the new thing, and Atlantic Canada has the feedstock and knowledge to use it.
Open ground is good territory for developing new policy by learning from others.
A number of traditional cradle to grave industries can support this new sector, by
supplying feedstocks and acting as consumers for finished product.
The regions diverse biomass (forest, agriculture, marine and municipal waste) can provide
a wide range of opportunities for technology development as well as production. And,
because it is a resource in smaller volumes than the average North American projects
there is opportunity to develop and prove small scale technologies that will be applicable in
Europe, Africa and Asia.
An export market to the U.S. is close and open.
Small can work.
Industry, refineries and government all share a desire to stop imports.
A large and interested academic and research community, unique to other parts of Canada,
has the potential to attract highly qualified professionals interested in commercializing
bioenergy technology.
There is now a federal mandate.
There is an un-served market in this region and an un-met need south of the border.
Economic development and job creation are high priorities in this region.
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Atlantic Canada can collaborate as a single region for development of this industry.
More cooperation with the CRFA as the industry grows.
New policies and programming that are tailored to this region and its needs.
Environmental opportunities for this region are undervalued, because of difficulty

quantifying in dollars.
Threats
Other jurisdictions continue to build infrastructure and industry, producing and blending
biofuels. Relying on supply from imports rather than developing domestic biofuels brings
no economic benefit to the region and would instead mean, losing millions of dollars in
potential revenues to the natural resources sector (ag, forestry and marine) and
opportunities to capitalize on technology development.
The downturn in the global economy is affecting all players.
Provincial governments are under fiscal restraint; their level of support is questionable.
Regional refineries are lobbying against the implementation of renewable fuels regulations
for biofuel.
There is a lack of will for provincial mandates, policy and programming.
Industry burn-out.
SWOT Conclusion
The development and delivery of a sustainable biofuels industry in Atlantic Canada is not an easy or
simple task; however, the opportunity to move forward is better than ever. The time is now. This
region has the feedstock in multiple applications, as well as desire from proponents and industry,
with the knowledge, depth and the ability to build the industry.
The are many hurdles to overcome; the key link, as will be explained in this reports
recommendations, is the lack of policy and programming specific to Atlantic Canada, to move the
Atlantic biofuels industry to full scale commercialization. Many factors and circumstances, driven
by both industry and government, as well as timing, have led to this current situation.
The biofuels community around the world is moving at a rapid pace, and industry development in
this region is a real possibility. With the recent delivery of the Canadian Renewable Fuels
Regulations, combined with the will, and the desire of industry and governments to manage the
details and applications of the regulations, and take advantage of the need for rural and regional
economic development and positive environmental impacts, Atlantic Canada can compete and
succeed on the world stage of this industry. The foundation is here; with the right seeds, it can
grow.
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Testing and Analysis for Quality Control

Quality control is paramount to the success of a biofuels industry; there are certain minimum
standards that producers must meet, in order to ensure quality product. As part of its research, this
project took on what ACBC believes is the very important task of identifying what support
analytical, instrumentation and chemical consulting assets currently exists for quality control, and
what would be required to support an Atlantic biofuels sector.
To do so, Dr. Gerrard Marangoni, Professor of Chemistry at St. Francis Xavier University and Lab
Director at X-Cell Analytical produced a comprehensive report entitled: A look at the current state
of QA/QC capabilities and capacity in the Atlantic region included as Appendix G of this report.
In summary, Dr. Marangoni suggests that the capacity to support a rapidly growing biofuels sector
from a quality assurance and quality control (QA/QC) perspective is limited, and that this shortfall
in support capacity could be a secondary opportunity for regional economic development by
employing highly qualified professionals, graduating from regional academic institutions, in a new
sub-sector of technical expertise.
According to the report, only one major corporate player has successfully implemented a quality
marketing initiative with regards to biofuels. There are no certified producers in the region, and
until recently, the Atlantic Canadian biofuels sector could aptly be described as a collection of small
and young biodiesel producers, unable to reach full capacity. The report explains that the biggest
reason for this capacity gap is the lack of expertise in the region required to scale-up backyard
operations. There are a number of firms capable of excellent plant designs, but significant expertise
is required to overcome scale-up issues that arise from a complex combination of chemistry and
engineering issues. Dr. Marangoni emphasizes that quality control must be an integral part of the
entire production process, which includes the storage and stabilization of the fuels in the postproduction phase before fuel is delivered to the customer.
It is imperative that the bio-based liquid fuels are of an equivalent quality standard to the
conventional fuels so as to achieve satisfactory operability and emission performance from the
vehicles that are utilizing these blends. This in turn requires total compliance with already
established national and international fuel quality standards, which will ensure consumer
acceptance of these fuels for their vehicles. This requires the establishment of a regional lab
and a testing facility that is equipped and able to help suppliers and consumers work through
inevitable operability issues and growing pains. The more quickly the industry can tackle
QA/QC field issues, consumer acceptance of the fuels will grow. At the same time, appropriate
guidelines and quality-monitoring protocols need to be in place to assure quality control in the
distribution process (certified marketers) and eliminate issues from the production of blended
fuels. In the case of biodiesels, the BQ-9000L system is recognized as the Gold Standard QA
System designed for the Biodiesel industry. The BQ-9000 certification is based on the industry
standard lab protocol ISO-17025, the standard for most commercial analytical labs around the
world. Implementation of this QA system for biodiesels and ethanol is a necessary feature for
any lab facility functioning as a biofuels research and development lab.
The report continues, suggesting that with an abundance of high-quality educational institutions,
Atlantic Canada can produce numerous technically literate graduates with knowledge that can be
applied in the biofuels sector. Dr. Marangoni proposes developing a Regional Biofuel Production
Initiative, encompassing members of various university and community college institutions, and
establishing a Regional Analysis Lab to satisfy QA/QC requirements of biofuels, tax incentives for
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both producers and consumers to embrace biofuels, as well as an education component. Dr.
Marangoni believes this initiative would be a significant catalyst to build and grow a biofuels sector
in this region.
X-Cell Analytical is the regions only full service lab specializing in the measurement of the physical
properties of complex fluids, and there are currently no other university labs capable of offering
these services in Atlantic Canada. However, there is capacity to leverage the academic assets we
have in this region to establish the required analytical labs and build a centre of excellence. As the
industry grows, it would require additional capacity, in both infrastructure and personnel.
Dr. Marangoni concludes his report with several key recommendations:
The Establishment of a Regional Biofuel Production Initiative as described above.
The Establishment of a QA/QC Environment - to improve the quality of the goods and
services being offered by the Atlantic biofuels industry including and create an attractive
industry. This environment would include research and development initiatives, a training
centre and university-based labs.
Inter-Provincial Buy-In and Investment - in the form of tax credits or subsidies to increase
the potential for entrepreneurs and investors to get involved with the industry, and provide
potential opportunities for industry players to access high quality analytical and service work,
benefiting economic development, industry survival and employment rates.
A business assessment of this sub-sector would help identify the funding commitments and
timeline requirements to implement these recommendations.
Policy and Programming

Alternative Fuels Policy History
The first federal alternative fuels policy was the 1975 introduction of the gasoline excise tax in
response to the 1973 oil crises. Propane and natural gas were exempted from this tax. In 1992,
the exemption was extended to ethanol made from biomass and methanol. In 1980, Manitoba
introduced tax incentives for ethanol produced from biomass in Canada. The policy drivers were
rural economic development and the 1979 oil crises.
In 1988, Saskatchewan followed with incentives for ethanol production and use. This was followed
by a number of other provinces and by 1992, there were tax incentives or tax exemptions in place
from BC to Ontario along with the Federal excise tax exemption. Various drivers were used in the
differences provinces but they were some combination of Rural/economic development Vehicle
exhaust emission reduction Energy diversification.
By the end of the1990s ethanol blends were sold by at least one marketer from Ontario to British
Columbia. In the late 1990s agricultural support payments began to increase significantly as
market prices for grains and oilseeds were below the cost of production. Rural economic
development became a larger driver and we started to see the next generation of biofuel policies.
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Saskatchewan was the first province to consider an ethanol mandate. The legislation authorizing
regulations with respect to a mandate was introduced in 2002; however, the mandate didnt come
into effect until 2005. The required blending level was soon ramped up to 7.5% as production
capacity increased. The Saskatchewan ethanol industry has grown from 1 to 5 plants and these
producers currently export to Alberta and BC. Three plants remain producer owned.
Manitoba and Ontario followed with ethanol mandates. Manitoba (8.5%) tied the mandate to local
production capacity, and Ontario at 5% - not tied to local production capacity. Ontario coupled their
mandate with capital incentives and a variable support program that proved to be very successful.
There are now seven plants producing more than the mandated requirements and there is now
over compliance in these provinces.
In 2006, the Federal government announced their Renewable Fuels strategy. It has four
components.
Increasing the retail availability of renewable fuels through regulation.

Supporting the expansion of Canadian production of renewable fuels.
Assisting farmers to seize new opportunities in this sector.
Accelerating the commercialization of new technologies.
The drivers for the Federal strategy were:
8) Creating new economic opportunities for our farmers and agricultural sector;
9) Advancing the bio based economy; and
10)Reducing GHG emissions.
In December 2010, the ethanol mandate became effective and in July 2011, the renewable diesel
mandate was implemented.
After the Federal announcement, several provinces moved to introduce their own mandates
including British Columbia with a 5% ethanol and 5% renewable diesel requirement (effective Jan
2010): Alberta with a 5% ethanol and 2% renewable diesel requirement as of April 2011, and
Saskatchewan with a 7.5 % mandate for ethanol.
Source: Canadian Biofuel Policies: Don OConnor (S&T)2 Consultants Inc. Ottawa, June 9, 2011
National and Provincial Policy and Programming

More recent national and provincial policies and programming were researched to provide a
picture of whats available across the country to support this sector, as well as indicate areas of
improvement for Atlantic Canada.
Canadian Federal Programs From West to East
Over the past decade, the Canadian government has made a clear commitment to renewable fuels
and advanced green technologies through timely and effective programs and grants. These
programs are meant to establish a self-sufficient industry by aiding in initial research, technology
development, demonstration projects and feedstock availability. These programs include:
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Environment Canada: Renewable Fuel Regulations
On September 1, 2010, the government of Canada announced the finalization of Federal Renewable
Fuel Regulations requiring an average of 5% renewable content in gasoline across Canada. This
Renewable Fuel Mandate will come into effect on December 15th, 2010. The full regulations are
available online.
In addition, the Government of Canada has announced a July 1, 2011 start date for an average 2%
renewable fuel content in diesel fuel and heating distillate oil.
Agriculture and Agri-Food Canada: Biofuels Opportunities for Producers Initiative (BOPI)
The Biofuels Opportunities for Producers Initiative (BOPI) ended on March 31, 2008.
BOPI was an initiative designed to help farmers and rural communities hire experts to assist in
developing business proposals and feasibility and other studies that were necessary to create and
expand biofuels production capacity by agricultural producers.
ecoAgriculture Biofuels Capital Initiative (ecoABC)
The ecoAgriculture Biofuels Capital Initiative (ecoABC) is a four year, $200 million federal program
that provides repayable contributions of up to $25 million per project for the construction or
expansion of transportation biofuel production facilities.
Funding is provided for projects that use agricultural feedstocks to produce biofuels and that have
new agricultural producer equity investments in the projects equal to, at minimum, five percent
(5%) of the total eligible project costs. The deadline for the construction or expansion of biofuels
facilities funded by ecoABC was September 30, 2012.
A total of 23% of the $186,000,000 available to ecoABC has been allocated.
Natural Resources Canada: ecoENERGY for Biofuels
The ecoENERGY for Biofuels Program supports the production of renewable alternatives to
gasoline and diesel and encourages the development of a competitive domestic industry for
renewable fuels.
The Program provides an operating incentive to facilities that produce renewable alternatives to
gasoline and diesel in Canada. EcoENERGY for Biofuels will invest up to $1.5 billion over nine years
in support of biofuel production in Canada. Administered by Natural Resources Canada, the
ecoENERGY for Biofuels Program runs from April 1, 2008 to March 31, 2017.
Recipients will be entitled to receive incentives for up to seven consecutive years. The final round of
funding is now closed.
Ethanol Expansion Program (EEP)
The Ethanol Expansion Program (EEP) aims to increase domestic production and use of ethanol, a
renewable transportation fuel, and reduce transportation-related greenhouse gas (GHG) emissions.
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The EEP provided contributions, with repayment terms, toward the construction financing of new
or expansion fuel ethanol production facilities in Canada. These plants are now built and are
producing ethanol at a collective nameplate capacity of approximately 1 billion litres per year.
Climate Change Action Fund Biodiesel Research
Before biodiesel can enjoy widespread commercial viability in Canada, more research and
development must be conducted to identify cost-effective ways for production and distribution and
address on-road performance including cold weather issues.
As part of the Climate Change Action Fund, the Government of Canada, through Natural Resources
Canada and the National Research Council , helped to fund the construction of a small
demonstration plant in Oakville, Ontario which has since been transformed into a full commercial
plant in Hamilton at BIOX Corporation.
Biodiesel (B-5 and B-20) has been tested in 155 buses in downtown Montral as part of a
demonstration project funded in part by the Government of Canada and the Quebec provincial
government. The aim was to study how biodiesel works in real-life conditions, particularly in cold
weather, and to determine the feasibility of supplying biodiesel to a mass transit company such as
the Socit de transport de Montral (STM) . The project also assessed the economic and
environmental impact of using biodiesel.
Saskatoon Transit Services is testing biodiesel by running two buses on B-5, along with two
"control" buses that run on conventional diesel. Over two years, each bus will be monitored and
evaluated for emissions, fuel economy and engine wear.
The National Renewable Diesel Demonstration Initiative (NRDDI) supports projects that
demonstrate how renewable diesel fuel will perform under Canadian conditions in advance of the
proposed renewable fuels regulation that would require an average annual 2% renewable content
in diesel fuel and heating oil starting July 1, 2011 subject to technical feasibility. This is a part of the
Government of Canada's Renewable Fuels Strategy. Off road components involved, rail, farm
equipment and marine. The NRDDI final report was released in October 2010.
Alternative Fuels
The Alternative Fuel site has been developed by the Fuels Policy and Programs Division within the
Office of Energy Efficiency.
Sustainable Development Technology Canada: Next Gen Biofuels Fund
The $500M NextGen Biofuels Fund is positioned downstream from the SD Tech Fund and
bridges the gap between technology and market development. This fund is aimed at supporting the
establishment of first-of-its-kind commercial scale demonstration facilities for the production of
advanced renewable fuels and co-products. The purpose of the Fund is to encourage retention and
growth of technology expertise and innovation capacity for cellulosic ethanol and biodiesel
production in Canada.
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This program is able to fund up to 40% of eligible project costs, or to a maximum of $200M. All
cellulosic ethanol and new biodiesel technologies, once they have been successfully demonstrated
at the pilot scale, are also eligible.
This outcome will enable larger volumes of advanced renewable fuels to be produced, helping
Canada achieve its current renewable fuel standard using environmentally superior technologies.
Advanced biofuels are derived from non-traditional renewable feedstocks, such as corn stocks,
wood chips, fast-growing grasses, agricultural residues, and forest biomass. These advanced
renewable fuels contribute to clean air, clean water and clean land, which address climate change
and improve the productivity and the global competitiveness of the Canadian industry.
SD Tech Fund
The $550M SD Tech Fund is aimed at supporting the late-stage development and pilot, precommercial demonstration of clean technology solutions, like advanced renewable fuels. This
important one-time investment bridges the gap between development and demonstration that is
critical for an emerging industry, such as renewable fuels. Advanced renewable fuels contribute to
clean air, clean water and clean land, which address climate change and improve the productivity
and the global competitiveness of the Canadian industry.
SDTC does not require any repayments of the financial contributions it provides to funded projects
through the SD Tech Fund . This fund will ensure that Canadian companies can innovate and
compete on a level playing field with our international competitors.
Provincial Policy and Programs

Provincial and territory contacts a complete list is attached as Appendix H of this report were
engaged to research the current state of policy and programming for biofuels and bioenergy across
the country.
British Columbia
Renewable Fuels Standard
British Columbia has had an escalating biodiesel mandate that has moved from 2% to 4% and now
currently sits at 5%.
BC Bioenergy Strategy http://www.energyplan.gov.bc.ca/bioenergy/
As part of its 2009 BC Energy Plan, the province of BC implemented a Bioenergy Strategy to:
Establish $25 million in funding for a provincial Bioenergy Network for greater investment
and innovation in B.C. bioenergy projects and technologies.
Establish funding to advance provincial biodiesel production with up to $10 million over
three years.
Issue a two-part Bioenergy Call for Power, focusing on existing biomass inventory in the
forest industry.
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Aim for B.C biofuel production to meet 50 per cent or more of the province's renewable fuel
requirements by 2020, which supports the reduction of greenhouse gas emissions from
transportation.
Develop at least 10 community energy projects that convert local biomass into energy by
2020.
Establish one of Canada's most comprehensive provincial biomass inventories that creates
waste to energy opportunities.
Alberta
Alternative and renewable energy sources are part of Albertas energy portfolio. The Government of
Alberta is taking action, through its Nine Point Bioenergy Plan, to support and encourage Albertas
bioenergy producers.
Quick Links: Alberta Biodiesel Association; Canadian Renewable Fuels Association Alberta Innovates: Bio
Solutions; Natural Resources Canada; Climate Change Central
Nine Point Bioenergy Plan
In 2006, the Government of Alberta committed to a Nine Point Bioenergy Plan. This plan includes three grant
programs (the Bioenergy Producer Credit Program, the Biorefining Commercialization and Market
Development Program and the Bioenergy Infrastructure Development Program) to stimulate bioenergy
development in Alberta.
Value-Added Opportunities
Bioenergy provides value-added development opportunities for Albertas forestry and agriculture sectors and
is part of Albertas commitment to clean energy production. Albertas strong livestock, forestry, canola and
grain base can provide a consistent feedstock for bioenergy facilities.
Alberta also has 20 million tonnes of annual waste in potential feedstock. Emerging technologies
have the potential to convert this waste to bioenergy products, including renewable fuels.
Renewable Fuels Standard
Albertas Renewable Fuels Standard (RFS) will require five per cent renewable alcohol in gasoline and two
per cent renewable diesel in diesel fuel. Please send questions about this standard to RFS.Energy@gov.ab.ca.
Bioenergy Grant Programs
The Bioenergy Producer Credit Program (BPCP) encourages the development of a wide variety of bioenergy
products including renewable fuels, electricity and heat with a credit per litre or kilowatt-hour. Please send
questions about this program to BPCP.Energy@gov.ab.ca.
News Release - Alberta increases support for clean energy production
(March 24, 2010)
Bioenergy Producer Credit Program (BPCP) Frequently Asked Questions
58
Biorefining Commercialization and Market Development Program and Bioenergy Infrastructure

Development Program
From 2007-2011, grants were provided through the Biorefining Commercialization and Market
Development Program (BCMDP) and the Bioenergy Infrastructure Development Program (BIDP) to
encourage the growth of a sustainable bioenergy industry.
Grant applications for these two programs are now closed.
Saskatchewan
Enterprise Saskatchewan website: www.enterprisesaskatchewan.ca/programs
Ethanol Fuel Grant Program
The Ethanol Fuel Grant Program supports the development of the ethanol industry in
Saskatchewan.
The program is intended to:
promote the development of the ethanol industry in Saskatchewan;
encourage, through corresponding ethanol general regulations, smaller ethanol production

facilities and complimentary industries (such as feedlot operations);
address production cost differentials associated with blending ethanol with gasoline; and,
promote the retail usage of ethanol-blended fuels.
The initial mandate was for 1% provincial pool volume beginning November 1, 2005, and increased
to 7.5% in January 2007. The ethanol program provides a 15 cent per litre grant to eligible
distributors who blend Saskatchewan produced ethanol within Saskatchewan for sale in
Saskatchewan.
Saskatchewan Renewable Diesel Program
Saskatchewan has introduced a mandate for inclusion of 2% renewable content in the average
annual diesel fuel pool for fuel distributors beginning July 1, 2012. In order to allow industry to
fully make the transition, the first compliance period will run from July 1, 2012, to December 31,
2014.
In anticipation of the mandate, the Saskatchewan Renewable Diesel Program incentive was
developed to support production of renewable diesel. The incentive component provides 13 cents
per litre of eligible renewable diesel to qualifying producers in Saskatchewan for use in all diesel
fuel applications. The incentive program is effective April 1, 2011, and terminates March 31, 2016.
The mandate and the incentive were recommended by the Enterprise Saskatchewan Biofuels and
Bio-Products Sector Team and the ES Board of Directors.
Renewable diesel is defined as a diesel fuel substitute made from renewable materials such as
vegetable oil, waste cooking oil, animal fat or fish oil, fungi, algae or other microbes, and potentially
59
from cellulosic feedstock consisting of agriculture and forest biomass by way of any acceptable
method (i.e. transesterfication, hydrotreating, etc.).
For the purposes of this program, this definition excludes traditional and non-traditional petroleum
derived products or resources as well as straight vegetable oils (SVO) or fats that are
untransformed to meet fuel standards.
Industry consultations for both the incentive and mandate have been completed and program
applications as well as distributor notification forms are now being accepted. The Saskatchewan
Renewable Diesel Program Incentives Guidelines and Application Form, as well as the Distributor
notification Form, can be found below.
There are two components to the Saskatchewan Renewable Diesel Program:
A mandate for inclusion of two per cent renewable content in the average annual diesel fuel
pool in Saskatchewan for fuel distributors beginning July 2012; and
The renewable diesel incentive program, which was developed to support the production of
renewable diesel in Saskatchewan.
The incentive and the mandate were recommended by the Enterprise Saskatchewan Biofuels and
Bio-Products Sector Team and the ES Board of Directors.
The incentive program will run for five years from April 1, 2011, to March 31, 2016. The program
begins one year earlier than the provincial mandate (July 2012) to ensure Saskatchewan producers
will have the incentive as the federal mandate is implemented July 1, 2011.
The program provides an incentive of 13 cents per litre of renewable diesel produced at facilities
located in Saskatchewan, sold, and delivered; delivery must occur during the period to which the
incentive relates. Renewable diesel which has been toll processed at a facility in Saskatchewan is
also eligible under the program. Volumes will be reported on a one hundred percent renewable
diesel (also called B100 or neat renewable diesel) basis and volume corrected to 15 degrees C.
The program is capped to support the annual production of 40M litres of renewable diesel,
about the amount used to meet the two per cent Saskatchewan mandate.
Incentives will be subject to caps. The maximum number of litres of Saskatchewan renewable diesel
eligible for an incentive in a fiscal year (April 1 to March 31 of the next year) per producer is 20M
litres. The total program incentive cap is set at 40M litres per fiscal year (April 1 to March 31).
The mandate of two per cent renewable diesel does not have an end date. However, the incentive
program does have an end date of March 31, 2016. Saskatchewan will work collaboratively through
the New West Partnership and other mechanisms towards developing a healthy, competitive, and
non-subsidized industry beyond that date.
Note: 2% provincial mandate in lock-step with Federal mandate to ensure provincial coverage
60
SaskBio
The Saskatchewan Biofuels Investment Opportunity (SaskBIO) Program, administered by the

Ministry of Agriculture, provides repayable contributions of up to $10 million per project for the
construction or expansion of transportation biofuels production facilities in Saskatchewan.
Corporations (including co-operatives), individuals or partnerships are eligible to apply for
funding. To be eligible, applicants must meet the following requirements:
Program applicants must have a minimum of five per cent Saskatchewan ownership in their
project; and
The minimum annual production capacity of a new facility or the increased capacity of an
existing facility must be at least two million litres per year.
Funding is based on a rate that increases with the level of eligible Saskatchewan investment.
SaskBIO was created to provide an opportunity for Saskatchewan residents to participate in valueadded biofuel production in Saskatchewan through investment ownership in biofuels facilities. The
program will ensure that Saskatchewan is an attractive jurisdiction in which to build a sustainable
biofuels industry.
Goals:
To create more jobs and economic spin-offs in rural Saskatchewan.
To create new markets for Saskatchewan agricultural producers.
To create increased activity in the Saskatchewan economy.
To create the opportunity to decrease our impact on the environment.
Deadlines:
To be eligible for consideration:
SaskBio program applications must be submitted by March 1, 2011.
Approved projects must be completed and commissioned by March 1, 2012.
Manitoba
Manitoba is currently committed to generate $2 billion in revenue through its bioproducts industry.
Its current mandate is for 8.5% ethanol and 2% biodiesel.
Key highlights of the Manitoba Bio-Products Strategy
(http://www.gov.mb.ca/agriculture/pdf/the_manitoba_bioproducts_strategy.pdf) include:
61
Provide incentives to biomass solid fuel manufacturers and to heat users to increase the
availability and use of biomass solid fuels in order to reduce coal consumption.
Form strategic partnerships with technology developers and investors to capitalize on

opportunities with advanced biofuels including cellulosic ethanol, syngas, green gasoline
and green diesel.
Continue to participate and support pilot biofuel production and bioenergy demonstration
projects, particularly on the use of biomass solid fuels for industrial, commercial and
community heating.
Biomass Support Program
The Manitoba Biomass Energy Support Program is intended to provide support to Manitobans in
the transition to the processing and use of biomass for heating in place of coal. There are two
components to the program: (1) a consumer component to assist coal users to purchase approved
biomass and (2) a capital component to assist biomass users and processors to establish or upgrade
infrastructure and facilities.
Ontario
Renewable Energy Regulations
Contact: Ontarios Renewable Energy Facilitation Office: e-mail at REFO@ontario.ca or by phone at

1-877-440-7336
Renewable Energy Approvals Regulations (REA):
http://www.ene.gov.on.ca/environment/en/subject/renewable_energy/index.htm
This regulation has spurred the growth of renewable sources of energy by streamlining the
approvals process for energy developers.
Ontario is moving away from fossil-fuel based, non-renewable energy sources, and toward natural
sources that generate less pollution and will help improve Ontario's air quality.
The Ministry of the Environment is proposing amendments to the Renewable Energy Approval
Regulation (O. Reg. 359/09) and revisions to the Technical Guide to Renewable Energy Approvals
as part of the response to the Ministry of Energys Feed-In-Tariff (FIT) Review.
Proposed changes would:
better align requirements with the environmental impact of the projects

increase clarity and allow developers to meet requirements concurrently
improve application turnaround times by streamlining the regulatory process
The ministry is also proposing that specific small scale renewable energy projects be allowed to
register with the ministry instead of applying for a Renewable Energy Approval under O. Reg.
359/09. Technical papers covering the three activities have also been posted for comment.
62
The review confirmed that the FIT Program has been key to making Ontario a leader in clean
energy production and manufacturing. The more than 2,500 medium and large FIT projects
approved to date will produce enough electricity to power 1.2 million homes. FIT has also attracted
more than $27 billion in private sector investment, welcomed more than 30 clean energy
companies to the province, created more than 20,000 jobs and is on track to create 50,000 jobs.
Ontarios Feed-in Tariff (FIT) Program was launched in 2009 to create new clean energy industries
and jobs, boost economic activity and the development of renewable energy technology, and to
improve air quality by phasing out coal-fired generation by 2014.
After tracking the programs progress, consulting within the sector, researching developments in
other jurisdictions and providing recommendations for improvements, the report contains
recommendations in six strategic areas:
Continue commitment to clean energy.

Streamline processes and create jobs.
Encourage greater community and Aboriginal participation.
Improve municipal engagement.
Reduce price to reflect lower costs.
Grow Ontarios clean energy economy.
The McGuinty Government has accepted the FIT Review recommendations, and through them, the
program will continue to contribute the provinces economic and environmental objectives and
ensure it provides good value for Ontario families.
Quebec
Quebec produces 145 ML ethanol and 35 ML biodiesel annually and is committed to reaching a 5%
target for ethanol.
Key industry policy initiatives include:
Start-up of a demonstration cellulosic ethanol plant

Tax credits for ethanol production max rate 0.185 $/L, variable according to petrol price
and void when barrel is over 65 $US/L
Tax rebate on fuels for biodiesel refund tax of 0.172 $/L on non-colored fuel oil for buying
pure biodiesel
New Brunswick
Government both federal and provincial has invested time and resources into some biofuels and
biorefinery projects, as well as research and development, in New Brunswick. But, there is
currently no policy and programming to support large scale commercialization of that industry.
The provinces Energy Strategy states a need to find ways to ensure the cost of biofuels and ethanol
produced in the province is sustainable and competitive before they are required by law.
63
Nova Scotia
According to the Department of Energy, Nova Scotia is actively engaged in assessing what impact
the proposed federal biofuels regulation which they state are pressing demands for biofuels
resources may have on the development of a biofuels industry in the province. The province is
also assessing what opportunities a future biorefinery industry may hold for Nova Scotia.
The Nova Scotia government passed a motor fuel tax credit ($0.154/L) for biofuels, but to date it
has never been drawn upon.
A few individual projects have received government support for early stage development; but, there
is currently no policy and programming to support large scale commercialization of the biofuels
industry.
Government both federal and provincial has invested time and resources into some biofuels and
biorefinery projects, as well as research and development, in PEI. In fact, this funding has led to
development of a small-scale pilot facility for biofuels production, using Atlantic Canadian
technology and feedstock. However, there is currently no further policy and programming to
support large scale commercialization of this industry.
The Government of Prince Edward Island established an Inter-Departmental Biofuels Committee
(IDBC) in March 2008, tasked to evaluate and advice government on the role bioenergy projects
and proposals can play in the provinces energy future. IDBC will consider the economic,
environmental and social benefits that may be derived for the people of Prince Edward Island. IDBC
will work with proponents of approved submissions to identify applicable federal and provincial
government assistance programs.
In the provinces energy strategy, PEI identifies a need to consider introducing escalating RFS for
ethanol and biodiesel and commits to a provincial E5 and B10 mandate by 2013, with intentions to
double that by 2018.
Newfoundland and Labrador
To date, Newfoundland remains exempt to the Canadian Renewable Fuels standards and as a result
there are no policies or programs to note.
64
United States Renewable Identification Numbers Program

Renewable Identification Number (RIN) is a renewable fuel credit - a serial number assigned to
each gallon of renewable fuel as it is introduced into U.S. commerce. RIN credits were created by the
Environmental Protection Agency (EPA) as part of the Renewable Fuel Standard (RFS) to track U.S.
progress toward reaching the energy independence goals established by the U.S. Congress.
Although this is an American program, RINs are important to Canadian producers who may be
considering exporting into the U.S. market and may also be a model for developing policies and
programs at home.
RIN credits are the currency used by obligated parties to certify they are complying with mandated
renewable fuel volumes. All fuel produced for U.S. consumption must contain either adequate
renewable fuel in the blend or the equivalent in RIN credits. RINs are tracked throughout each link
in the supply chain, as title is transferred from one party to the next, until the point in time where
the biofuel is blended with petroleum products. Once the renewable fuel is in the fuel, the RIN is
separated and is then eligible to trade as an environmental credit.
A renewable fuel is defined in the Energy Policy Act as a motor vehicle fuel that is produced from
plant or animal products or wastes, as opposed to fossil fuel sources. Renewable fuels include
ethanol, biodiesel and other motor vehicle fuels made from renewable sources.
The RFS program was created under the Energy Policy Act (EPAct) of 2005, and established the
first renewable fuel volume mandate in the U.S. This standard is used by obligated parties (refiners,
importers and blenders other than oxygen blenders) to calculate their renewable volume
obligation. RFS is based upon the American motorists fuel use in any given year.
As required under EPA, the original RFS program (RFS1) required 7.5 billion gallons of renewable
fuel to be blended into gasoline by 2012.
Under the Energy Independence and Security Act (EISA) of 2007, the RFS program was expanded in
several key ways:
EISA expanded the RFS program to include diesel, in addition to gasoline;
EISA increased the volume of renewable fuel required to be blended into transportation fuel
from 9 billion gallons in 2008 to 36 billion gallons by 2022;
EISA established new categories of renewable fuel, and set separate volume requirements
for each one;
EISA required EPA to apply lifecycle greenhouse gas (GHG) performance threshold
standards to ensure that each category of renewable fuel emits fewer greenhouse gases
than the petroleum fuel it replaces.
EPA Moderated Transaction System (EMTS) is a database maintained by EPA to handle RIN transfer
activities between interested parties. The objective is to eliminate duplicate RINs and other
problems associated with the current RIN system by centralizing this aspect of the RFS.
The RINAlliance a web-based renewable fuel compliance service open to all blenders and
marketers registered with the EPA. The RINAlliance advantage provides confidential management
65
and reporting services on behalf of registered blenders, reports direct to EPA, and aggregates
marketable RINs for convenient brokering to refiners and importers.
RINAlliance is operated by industry specialists that allow marketers and blenders to share profits of
aggregated trading within the RIN market.
Further information is available at http://www.epa.gov/otaq/fuels/renewablefuels.
Reference:
RFS1, RFS2, and EMTS by Ed Burke
ACBC agrees in principal with this theory of measurement, and would suggest that consideration
for Canadian produced biofuels in relationship to Federal and Provincial policy and programming,
should be feedstock agnostic.
In Canada, Sustainable Development Technology Canada (SDTC) currently has programs to assist
Canadian proponents in the development of next generation biofuels. Both interests by SDTC and
US RINs impact investment and industry development, however the approaches are quite different
in Canada and the U.S. This reports recommendations will consider how the best fit for Atlantic
Canada producers in consideration of environmental interests and North American policy and
programming.
66
ATLANTIC CANADA BIOFUELS FEASIBILITY MODEL

To understand the true cost and potential return on investment for production facilities in Atlantic
Canada, Gardner Pinfold Consultants Inc., were contracted to develop a tool that producers and
lending agencies could use to analyze prospective ethanol and biodiesel fuel projects. As leading
expert in the field of
As one of Canadas leading economic consultants, with specialized expertise in analysis,
assessments and forecasting, Gardner Pinfolds work calculates the feasibility of this sector in
Atlantic Canada.
The finished product an Atlantic Biofuels Feasibility Model (the Model) is attached in its entirety
as Appendix I and summarized here.
The structure of The Model relies on 1) a general approach to financial feasibility analysis and 2)
specific information for production of biofuel.
Costs and revenues are calculated annually over a twenty-year period and summarized
according to key production and financial indicators that would be of interest to
investors. The financial analysis is based on generally accepted management
accounting principles and Gardner Pinfold Consultants Inc. experience with
construction and review of similar models for a wide range of projects.
The specific information for production of biofuels from a selection of different
feedstocks is largely based on published reports for commercial facilities in Canada and
the U.S.
The model is designed to help assess the financial viability of biofuels production options in Atlantic
Canada, based on six key factors:
Feedstock types and their relevant attributes for biofuels production for example
costs, delivered freight charges, conversion efficiency. There are seven feedstock
options: corn, wheat, barley cellulose, canola, sugar beets / other and soybean.
Plant scale, in terms of biofuel production capacity, including efficiency over the life of
the plant.
Pre-construction and construction costs including capital, pre-operating, contingency
funds, and working capital needed until revenues begin.
Financing options from banks, different levels of government, other sources, and
private equity (including interest rates and amortization periods).
Operating costs, including a wide range of inputs such as the number of employees,
salaries, benefits, and administration costs.
Revenues from the biofuel product as well as by-products, including animal feed, heat
and power.
After entering information for each of these six areas, the Model calculates production results and
financial indicators to assess the potential performance of a biofuel plant. The Model can evaluate
up to six plants simultaneously and provide a summary of results for all six on a final comparison
sheet, with a profile of the inputs for each plant. A side-by-side comparison gives operators the
opportunity to evaluate the performance of plants that might have different feedstocks or different
67
capacity. Additionally, model users could adjust any number of other variables such as feedstock
price, interest rates, % equity, revenue, or capital costs to different levels, to see how they might
impact the overall performance of a plant.
This ability to assess the impact of different variables can also help operators identify what they
need to make a plant financially attractive to bank lenders or private investors. For instance, a
potential plant may initially appear to have an 8-year payback period; but, a combination of
variables like low-interest loans, capital cost assistance, feedstock subsidies, and salary rebates
could be examined to determine what might bring the payback period down any number of years.
An example of what a model comparison output might resemble.
Plant Profiles
Plant 1
Product
Feedstock
Plant capacity (litres)
Financing
Required funds
% Equity
Feedstock
Crop yield per acre
Crop delivered cost per ton
Revenues
Revenue per litre of product
Other revenue per litre of product
Total revenue per litre of product
Plant 2
Plant 3
Plant 4
Plant 5
Plant 6
Ethanol (corn)
38,000,000
Ethanol (wheat}
38,000,000
Ethanol (cellulose)
25,000,000
Biodiesel (canola)
10,000,000
Ethanol (sugar beets)

25,000,000
Biodiesel (soybeans)
10,000,000
47,678,147
37%
56,952,164
37%
39,926,709
60%
25,931,068
61%
27,815,818
28%
15,001,068
33%
1.75
254
0.98
304
1.40
131
0.75
660
35.00
50
0.90
508
$0.63
$0.33
$0.96
0.63
0.33
0.96
0.67
0.1
0.77
1
1
2
0.67
0.34
1.01
1
1
2
Key Results
Plant 1
Plant 2
Plant 3
Plant 4
Plant 5
Plant 6
Local economic benefits

Crop tonnes
Crop acres
Farm income
Transport income
95,000
54,286
$23,750,000
$1,330,000
102,703
104,799
$0
$1,360,811
78,125
55,804
$0
$1,093,750
21,505
28,674
$0
$465,054
250,000
7,143
$0
$1,250,000
50,000
55,556
$0
$650,000
Plant financials
Payback period
IRR
Year 5 net cash flow
Year 5 debt:equity
Year 5 profit margin
12
5%
$4,857,499
65%
13%
At least 20 years
Negative
($2,669,620)
66%
-7%
13
4%
$3,409,567
26%
18%
11
7%
$2,722,728
24%
14%
5
21%
$7,506,742
78%
30%
At least 20 years
Negative
($8,393,323)
76%
-42%
Disclaimer: This Model is intended to provide general guidance and a tool for analysis only and is not intended to provide financial advice or to be used as the basis for investment decisions.
Source: Atlantic Biofuels Feasibility Model
To understand how The Model works, the below table shows results based on a set of baseline plant
profiles with a scale that would be relevant in Atlantic Canada for a moderate mandate for biofuels
production approximately 25 million litres. Each of the plants uses a different feedstock corn,
barley, cellulose, beets, canola and soybeans which triggers different capital and operating costs.
The Model can assess wheat feedstock, but it is not included here, because it is very similar and
actually slightly inferior to the financial performance of a barley plant. Also important is that
cellulosic (wood) plant settings are theoretical, because there are no commercial plants in
operation to use as a baseline. And, the corn plant is considered theoretical because its scale is
below the scale of plants built within the past decade.
Results of this baseline analysis suggest a sugarbeet plant is a viable opportunity and that canola
and corn are also encouraging. Results for the other types of feedstock plants show lengthy payback
periods making them less attractive.
68
Table A1: Baseline plant profiles for each feedstock

Product
Feedstock
Capacity (Ml)
Plant 1*
Ethanol
Corn
25.0
Plant 2
Ethanol
Barley
25.0
Plant 3*
Ethanol
Cellulose
25.0
Plant 4
Ethanol
Beets
25.0
Plant 5
Biodiesel
Canola
25.0
Plant 6
Biodiesel
Soybeans
25.0
Financing
Required funds
($M)
% Equity
$35.2
30%
$59.4
30%
$68.3
30%
$27.8
30%
$42.2
30%
$37.0
30%
Feedstock
Crop yield (t/ha)
Conversion (l/t)
Delivered cost ($/t)
4.4
400
$254
2.8
325
$214
3.5
300
$156
87.5
100
$54
1.9
465
$624
2.3
200
$404
Revenues
Biofuel ($/l)
Other ($/l)
Total ($/l)
$0.67
$0.34
$1.01
$0.67
$0.34
$1.01
$0.67
$0.34
$1.01
$0.67
$0.34
$1.01
$1.00
$1.00
$2.00
$1.00
$1.00
$2.00
Plant 1*
Plant 2
Plant 3*
Plant 4
Plant 5
Plant 6
62,500
9,615
$1.5
$15.6
$1.5
76,923
28,045
$1.5
$16.2
$1.6
83,333
24,088
$1.2
$12.5
$1.8
250,000
2,891
$1.0
$12.5
$2.3
53,763
29,010
$0.7
$33.3
$1.5
125,000
56,206
$0.5
$50.0
$1.8
15
4%
$3.4
70%
13%
>20
-7%
$1.7
80%
7%
16
3%
$5.7
80%
23%
5
18%
$6.4
66%
25%
6
16%
$9.1
73%
18%
>20
Negative
($7.6)
71%
-15%
Key Results
Local benefits
Crop tonnes
Crop hectares
Plant workers ($M)
Farms ($M)
Transport ($M)
Plant financials
Payback period
(yrs)
IRR
Yr 5 net $ flow
Yr 5 debt: equity
Yr 5 profit margin
Disclaimer: This Model is intended to provide general guidance and a tool for analysis only and is not intended to provide financial advice or
to be used as the basis for investment decisions.
*Note: Commercial scale corn ethanol plants being built today are much larger than 25ML; Ethanol from wood cellulose has not been
produced commercially, consequently model results are only theoretical for this feedstock.
69
By adjusting key variables of plant capacity, feedstock prices, revenues and capital cost, the Model
produces results that show their effect on the payback period of these baseline plants. Generally
speaking, the payback period moves in the expected direction, which is important when
considering these key variables.
Plant capacity (38 ML and 76 ML) the payback period declines as plant size
increases. This is especially true for corn ethanol plants and the most recently
constructed plants are upwards of 200 ML owing to these economies of scale.
Feedstock prices (20% lower or higher) are one of the two most significant
drivers of plant viability (along with biofuel product prices). A 20% change in
prices can alter the payback period by multiple years for all feedstock types.
Revenues (20% lower or higher) can cause the payback period to change by
3-12 years depending on the feedstock and direction of change (lower or
higher prices).
Capital cost (20% lower or higher) has at least 1 year effect on payback
period in either positive or negative directions, and this can be up to a three
year difference in the case of corn ethanol plants. Although this is not as
influential as the feedstock or finish product prices, the significance here is
the potential positive effects of technology improvements and capital
subsidies as well as the potential negative effects of cost overruns (although
contingency funds are included in the Model).
Table A2: Effect of key variables on payback period (years) relative to baseline plants (as in
Table A1)
Biofuel
Feedstock
Baseline 25ML
Larger plants
38ML
76ML
Feedstock prices
20% lower
20% higher
Revenues
20% lower
20% higher
Capital cost
20% lower
20% higher
Plant 1
Ethanol
Corn
15*
Plant 2
Ethanol
Barley
20
Plant 3
Ethanol
Cellulose
16*
Plant 4
Ethanol
Beet/Other
5
Plant 5
Biodiesel
Canola
6
Plant 6
Biodiesel
Soybeans
20+
10
8
20+
19
11*
9*
5*
4*
6
4
20+
20+*
6*
20+*
16
20+
10*
20+*
4
8
3
20+
19
20+
20+*
5*
20+
12
20+*
8*
20+
3
20+
2
20+
20+
12*
18*
20+
20+
12*
18*
5
7
5
7
20+
20+
Disclaimer: This Model is intended to provide general guidance and a tool for analysis only and is not intended to provide financial advice or
to be used as the basis for investment decisions.
*Theoretical plant design
70
These results are intended only to provide a general analysis; definitive results would depend on
using data specific to particular projects. To fully understand the impact of this feasibility model,
proponents will want to spend time using the associated workbook, through ACBC and Gardner
Pinfold. This model will allow industry proponents and their associated partners and investors to
consider several options that may be applicable to their region, and their particular expertise.
Although we do not anticipate that this process will provide a bankable feasibility study of a
particular project we do assume that the use of these tools will be suitable in providing accurate
information on plant location, feedstock supply, possible partnership involvement with primary
producers, financing, operations, return on investment and payback period.
This tool can be utilized by stakeholders in the early stage of decision making to assess or
determine if an individual or organization wants to move forward with a full-scale business model
and feasibility study based on initial research.
This Model, designed to help assess the financial viability of biofuels production options in Atlantic
Canada, has been validated by the entire ACBC Board of Directors, as well as industry stakeholders
from across Canada, to ensure it is applicable for scenarios and situations based in this region.
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Economic Impact Study

The firm of Gardner Pinfold Consulting Inc. was also engaged to assess the economic impact for the
biofuels sector in Atlantic Canada, to provide industry and government with a tool to improve the
understanding and further the development of a biofuels industry in this region. The expertise and
credibility this firm carries in the areas of research, analysis, assessment and forecasting is
validates the impact this sector could have for Atlantic Canada.
The study set out to answer the question: If a bio-fuels industry were to develop in the Maritime
Provinces, what would be its impact? Because current biofuels production in this region is not
operating on the scale needed to meet federal ethanol and bio-diesel mandates, there is no basis to
document economic impacts.
In terms of methodology, the study offers this important explanation of the demand for feedstock:
The level of agricultural production is a function of the feedstock requirements of the
biofuels industry. The latter, in turn, is a function of three things: the demand that a
Maritime biofuels industry is able to meet; the crop yields per hectare; and conversion
factors of each of the crop inputs (energy content in terms of litres of fuel). Of these,
biofuels demand is the most significant source of variability in determining impacts.
The biofuels industry in North America is driven mainly by Renewable Fuels Standards
(RFS) introduced by various levels of government in Canada and the U.S. The RFS
requires refiners and importers of prescribed fuels (i.e. gasoline, diesel and heating oil)
to blend these with specified volumes or percentages of renewable fuels:
Ethanol: In Canada, the federal RFS mandate is 5% ethanol for gasoline (through
refiners generally blend to 10% because of relatively low ethanol costs), and in the U.S.
the mandate is 105 with current consideration for 15% (some provinces/states have
higher mandates). In both countries, corn is the main feedstock.
Biodiesel: the federal FRS mandate is 2% in both countries, with some provinces/states
mandating a blend as high as 5%.
To meet the RFS mandate in the Maritime Provinces (assuming refiners are required to
blend locally) would mean a requirement for up to about 250 ML of ethanol and 75 ML
of biodiesel. In fact, the potential biofuel opportunity is much greater, since fuel
produced with sugar beets would qualify as a blendstock under the US RFS2. This opens
up a substantially larger export market that could easily double the Canadian-based
demand.
For the purpose of estimating economic impacts, this study used the above mentioned
volumes 250 ML ethanol and 75 ML biodiesel as the basis for a biofuels industry in the
Maritimes. The study also assumes that biofuels plants have a capacity of 25 ML. To estimate
the economic impact of meeting the 250 ML ethanol and 75 ML biodiesel demand, we build up
the industry in discrete 25 ML increments, with plants located strategically across the Maritime
Provinces.
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The main objective of this study was to quantify both the direct and spin-off impacts of developing
and operating a biofuels industry in the Atlantic Provinces; to do so, it uses the Statistics Canada
Inter-provincial Input-Output Model, because it produces direct, indirect and induced impact
results and it produces results at a high level of resolution. Normally, this model uses the gross
value of the output, the revenues generated through sales of the final product, to measure economic
impact. But, because there is no established biofuels industry in the Maritime Provinces, this study
instead uses the value of the commodities used in the production process.
The information in this study will provide prospective investors, lenders and governments with a
better understanding of the scale of the industry and how its development and operation would
affect the economies of each of the Atlantic Provinces, tracing the direct impacts of the bio-fuels
industry itself, as well as the indirect impacts of those industries supplying it with goods and
services.
The report states that economic impact can be measured by four indicators:
GDP: an industrys contribution to Gross Domestic Product represents its broadest
measure of economic impact. The domestic product of the biofuels industry captures the
value it adds to purchased inputs (e.g. feedstock and utilities) through the application of
labour and capital. GDP represents the sum of the value added by all firms in an
industry, where value added is composed of the income earned labour income, and
returns to and of capital.
Employment: industry employment is important because of the significance generally
attached to jobs; from a purely economic impact perspective, the significance lays the
economic impact generated through the spending of employment income. The greater
the employment and higher the average income, the more significant the industry in
terms of its overall economic impact. Unless otherwise indicated, employment is
measured in full-time equivalents (FTE).
Labour income: this captures payments in the form of wages and salaries earned in an
industry. Returns to labour in the form of wages, salaries and earnings form a key
component of GDP. Industries paying relatively high average wages and salaries
generate a correspondingly higher economic impact than industries paying lower
average incomes.
Tax revenue: this captures revenues from such sources as federal and provincial sales
taxes, as well as excise taxes applied to sales of petroleum products used in production. It
also includes estimates of personal and corporate income taxes.
And, as the report further defines, economic impacts are generated through direct, indirect and
induced demand in the economy:
Direct impact: refers to impact generated by the activity of firms in the subject
industry (in this case, biofuels). Direct GDP refers to the value added created by
biofuels companies, while direct employment refers to the jobs created on site by these
companies.
Indirect impact: refers to the impacts arising from purchased inputs triggered by the
direct activity. For example, biofuels companies buy feedstock from farms, and utilities
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and chemicals from other suppliers. These farms and suppliers in turn buy their inputs
(e.g. seeds, fertilizers, fuel, equipment, professional services) from other companies,
and so on. Taken together, the process of producing these goods and services creates
profits, employment and income generating indirect impacts.
Induced demand: refers to the demand created in the broader economy through
consumer spending of incomes earned by those employed in direct and indirect
activities. It may take a year or more for these rounds of consumer spending to work
their way through an economy.
The study identifies two key categories of economic impact for a biofuels industry in Atlantic
Canada: plant construction and plant operations.
First and foremost, this region will benefit from positive economic impact during the 18-24 month
construction phase of biofuels plants. The below table shows the impacts on a per plant basis that
would occur in each province, for each plant built.
Table 3: Biofuels plant construction impacts

New Brunswick
Nova Scotia
(GDP, Income & Tax in $000s; Employment in FTE)

Capital cost
42,200
35,200
27,800
17,724
10,128
4,220
32,072
24,992
7,392
4,659
37,043
10,008
2,502
4,475
16,985
346
116
65
526
287
90
60
436
168
48
44
260
14,348
10,972
2,532
27,852
14,432
4,576
2,589
21,597
6,116
1,946
1,668
9,730
1,069
5,013
2,194
8,276
1,261
3,888
1,830
6,979
570
1,751
1,446
3,767
GDP
Direct
Indirect
Induced
Total
Employment
Direct
Indirect
Induced
Total
Income
Direct
Indirect
Induced
Total
Tax revenue
Corporate
Personal
Sales & excise
Total
Source: Statistics Canada Interprovincial Input-Output Model 2008 version
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Based on the previously identified projected capacity of 325 ML, and a per-plant capacity of 25 ML,
this region would require 13 plants to meet that total. Multiplying the figures in the above table by
13 provides an estimate for the overall one-time economic benefit of plant construction:
approximately $373.1 M in GDP, over 5,000 FTEs, an average total income of $256.1 M and average
total tax revenue of $81.9 M.
Once biofuels plants are operational, the economies in each province will see a positive economic
impact. The below table shows the per plant impact for each province, on an annual basis, meaning
these figures will continue to provide economic impact year over year.
Table 4: Biofuels plants operations impacts
New Brunswick
Nova Scotia
(GDP, In
GDP
Direct
Indirect
Induced
Total
Employment
Direct
Indirect
Induced
Total
8,430
8,145
2,804
19,379
5,845
9,455
2,708
18,008
7,925
8,710
2,235
18,870
15
224
104
343
30
240
95
364
20
269
99
388
930
6,720
1,275
8,925
1,845
7,055
1,300
10,200
1,240
7,430
1,020
9,690
715
1,607
890
629
1,836
1,143
694
1,744
1,590
3,211
3,608
4,028
Income
Direct
Indirect
Induced
Total
Tax revenue
Corporate
Personal
Sales & excise
Total
Again, based on the operation of 13 plants to meet the full 325 ML capacity in this region, the
annual economic impacts shown above will multiply, totalling up to $244 M in GDP, nearly 5,000
FTEs, an annual income of $125 M and an annual tax revenue to federal and provincial
governments of close to $50 M.
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Table 5: Long term potential annual economic impact of the biofuels industry
New Brunswick
Nova Scotia
1 Plant
5 Plants
1 Plant
4 Plants
1 Plant
4 Plants
Maritime
Provinces
13 Plants
GDP
Direct
Indirect
Induced
Total
Employment
Direct
Indirect
Induced
Total
8,430
8,145
2,804
19,379
41,140
41,855
12,883
95,878
5,845
9,455
2,708
18,008
23,380
37,820
10,831
72,031
7,925
8,710
2,235
18,870
31,700
34,840
8,940
75,480
96,220
114,515
32,654
243,389
15
224
104
343
85
1,210
510
1,805
30
240
95
364
120
959
378
1,457
20
269
99
388
80
1,076
394
1,550
285
3,245
1,283
4,813
930
6,720
1,275
8,925
5,270
35,020
5,865
46,155
1,845
7,055
1,300
10,200
7,380
28,218
5,202
40,800
1,240
7,430
1,020
9,690
4,960
29,720
4,080
38,760
17,610
92,958
15,147
125,715
694
1,744
1,590
4,028
2,774
6,977
6,360
16,111
8,822
22,629
16,782
48,233
Income
Direct
Indirect
Induced
Total
Tax revenue
Corporate
715
3,532
629
2,516
Personal
1,607
8,308
1,836
7,344
Sales & excise
890
5,850
1,143
4,572
Total
3,211
17,690
3,608
14,432
It cannot be overstated that these figures represent annual impacts for an industry with a long-term
life expectancy, of 25 years or more. Operating at its full potential, year over year, a biofuels
industry will result in significant long-term economic impact for Maritime Provinces. Combining
these two identified economic impacts for the region over a 5 to10 year period, including the time
and resources to build the plants and the overall operations of the plants could result in a $Billion
economic impact, with potentially $300 to $500M in government tax revenue and thousands of
jobs.
The figures outlined above and detailed in the complete study also do not include the potential for
export sales. It has already been established that proponents in Atlantic Canada can be productionready to export, which will further increase production and possibly double the economic impacts.
The study summarizes that although a large-scale biofuels industry does not currently exist in the
Maritime Provinces, the opportunity for direct and indirect impacts is clearly evident. The
emergence of such an industry could create the demand for suitable crops that are currently not
grown, or not grown in sufficient quantities at acceptable cost to meet industry requirements. This
forms a key underlying assumption of this analysis that the crops needed to support a biofuels
industry are currently grown within the region, and grown within a cost structure that allows both the
farms and the biofuels industry to operate profitably. Additionally opportunities may be created for
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feedstock supply of non-traditional or non-agricultural feedstock that could create new

opportunities and impacts for the region.
In short, if the biofuels industry develops to its domestic potential to supply regional ethanol and
biodiesel needs, this region will experience significant economic impact. Additional impacts could
be realized for exports as the industry develops and matures. And, a growing biofuels sector will
also realize other important outcomes such as: home grown energy production, a path forward to
increased control of energy supply and less reliance on imported energy, a reduction in fossil fuel
use, and a cleaner and greener environment.
The complete Economic Impact Study submitted by Gardner Pinfold is attached to this report as
Appendix J.
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RECOMMENDATIONS
Throughout the duration of this project, ACBC worked with its industry association members,
Atlantic bioenergy stakeholders, Maritime Canada production facility proponents, industry
producers & refineries, industry distribution companies, research and academic professionals,
provincial and federal government officials and bioenergy stakeholders at large.
The result, after 18 months of engagement and information sharing, are the findings included to
this point in the report, and most importantly, the proposal of recommendations to support the
development of a biofuels production industry in Canada and achieve the economic and
environmental impacts the industry holds for this region. They present significant immediate
impact, in addition to other short and long-term benefits for Atlantic Canada, demonstrating that
support for this sector can result in jobs, economic development and opportunity for multiple other
sectors in the region.
These recommendations are based on experiences and working solutions from other parts of
Canada, North America and the world, with proven track records for government support and
industry success, including a demonstrated return on investment. They are an initiative for
government collaboration and industry cooperation, seeking commitment from both the
Government of Canada and the provincial governments of New Brunswick, Prince Edward Island
and Nova Scotia and will require an aggressive and committed plan of action from all parties.
The following four recommendations are proposed as the key public policy instruments required to
set the stage and drive industry development for Atlantic Canada.
RECOMMENDATION #1
IMPLEMENTATION OF RENEWABLE FUELS REGULATIONS
Specifically:
The Government of Canada continue to finalize and implement the renewable fuels
regulations as legislated.
The Maritime Provinces adopt complimentary provincial renewable fuels legislation.
Rationale for Renewable Fuels Standards: Securing a Local Market and Local Demand
Renewable Fuel Standards (RFS) create the market for biofuels and give market certainty to private
investors.
Through implementation of the Canadian RFS from the Government of Canada, and additional
provincial policy and programs for renewable fuel standards (requiring a minimum percentage of
blended biofuels, commonly recognized on a national scale as 5% ethanol and 2% biodiesel) the
biofuels industry has seen large-scale development from the Pacific Coast through to the Quebec /
New Brunswick border.
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Renewable Fuel Standards also cement a long term commitment from government and industry to
drive development, and at the same time they eliminate uncertainty for production and
distribution. The mandate further promotes consumer confidence in the acceptance and
consumption of biofuels and a better understanding and approval of the domestic benefits.
The Canadian Government Renewable Fuels Regulations (RFR) came into effect in December 2010,
requiring 5% ethanol content. As such, consumers within most regions of Atlantic Canada have
been using gasoline blended with ethanol since that time. Unfortunately, this blended ethanol
currently has to be imported from other jurisdictions, in order to meet the requirement.
Implementing this projects recommendations will resolve this issue, allowing local production to
meet requirements for the local market.
Implementation of the RFR requiring 2 % blend for diesel fuel and heating oil was delayed Atlantic
Canada until January 1, 2013; further delay came in December 2012, with a proposed amendment
for this region, which could potentially eliminate or exempt blend requirements for home heating
oil completely. At the time of this report, that proposed amendment remains under consideration
and implementation of this regulation remains under delay.
It is our belief that the intention of a national standard was to eliminate a patch work of policy and
provide a minimum required standard throughout the country. This also provides market certainty
on a national scale, and a level playing field for producers, refineries and distributors. We fully
support and commend the Government of Canada for its intent with this national policy.
In New Brunswick and Prince Edward Island, gasoline and diesel are supplied primarily by one
single refinery, and as a result, the required blend can be met by supplying portions from each
province a practice which causes confusion for both consumers and retailers, and creates a
perception of uncertainty around markets and prices, making lenders and investors weary. In the
province of Nova Scotia, the distribution of fuel is generated primarily through a single refinery,
and in this case based on geography and national refinery locations, this refinery can meet its
national obligation of blending by doing so in other regions of the country. This makes Nova Scotia
the only province in Canada other than the locations originally exempt from the national standard
that does not blend ethanol in its gasoline pool. This is not strategic or beneficial for Nova Scotian
consumers, nor do we believe it was the original intention of the national standard to provide a
circumstance resulting in this kind of regional loop holes.
This report repeatedly suggests that a proposed and potentially successful biofuels industry for the
Maritime region is based on the indented national implementation numbers, and would provide for
an industry production scale of well above 300 ML of biofuels, produced locally, and providing
local economic and environmental benefits. Implementing a Renewable Fuels Standard on a
provincial basis, that is equal to that already in place nationally, eliminates the gaps in policy, puts
an end to the confusion, and solidifies the commitment to succeed in this arena.
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RECOMMENDATION #2
NATIONAL & CORRESPONDING PROVINCIAL CAPITAL ASSISTANCE PROGRAMMING
Specifically:
Atlantic Biofuel Capital Development Initiative: The introduction of a Government

of Canada capital assistance program for Atlantic Canada creating the opportunity
for equity investment by primary feedstock producers in the region.
Provincial Biofuel Capital Initiative: The Provinces of NB, PEI, and NS introduce a
corresponding and complimentary provincial capital assistance program, to expand
on and to include the opportunity for equity investment by primary feedstock
producers and / or other provincial residents, companies or organizations.
Rationale for Capital Programs

This report recognizes several examples as the proposed capital costs for to build biofuels
production facility plants. These production facilities are clearly large scale industry projects and
are very capital intense.
ACBC and its membership believe that it is important to create the best opportunity for local
ownership of newly constructed biofuels production plants. Local production, in our opinion
should be owned by local people whenever possible. Local ownership will help create more local
jobs and economic spin-offs for local economies. Capital assistance programming can provide the
opportunity for farmers, communities and local residents at large to participate in the value-added
biofuel production industry in the region through investment ownership.
Capital programming should be designed to assist proponents to acquire overall financing of their
projects and at the same time attract partnerships for local people and their communities.
The ecoAgriculture Biofuels Capital Initiative, commonly referred to as ecoABC, was an excellent
example of a correct and effective capital program. Though it has ended as of March 31, 2013, the
success of this program can be seen throughout Canada, in current production facilities and
industry success. This region was unfortunately unable to take advantage of the program because
the industry here was considered to still be emerging. There we no established renewable fuels
regulations or a fully implemented national regulation to assist in market development and little
other policy or programming to support opportunities at the time.
The original ecoABC program was a $159 million federal program that provided repayable
contributions of up to $ 25 million per project for the construction or expansion of transpiration
biofuel (ethanol or biodiesel) production facilities, which included new equity investment by
farmers and used agricultural feedstock to produce the biofuel.
This recommendation proposes a smaller scale refined version of this program from the
government of Canada that would support Atlantic Canada. An Atlantic Specific program, that
works in unison with a compatible provincial program. The newly introduced national program
could be a smaller region-specific lending pool, with a maximum repayable contribution. This
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proposed program would have the potential to assist the first number of plants built in the
Maritimes before the program would be set to expire. Again, this is not a grant or a direct cost to
the government; this is a repayable loan, using similar criteria and qualification for application and
repayment as the original national program.
The complimentary provincial program, something like a New Brunswick/Nova Scotia/PEI Biofuels
Capital Initiative (BCI) would be similar in contributions, repayable terms and conditions to
compliment the national program however not limited to agriculture partners. Agriculture
partners of course would qualify but so would local corporations, (including co-operatives),
individual or partnerships, for example.
In the case of both programs, the capital assistance for a repayable loan may be calculated on a
sliding scale of ownership. The larger the agricultural or the local ownership, the larger the scale of
contribution from the program - up to a maxim contribution.
Although this industry at the proposed scale is relatively new to this region, traditional lending for
this type of project may require up to 40 % equity and 60 % financing. As a hypothetical example, a
production plant that would cost $35M (40% equity) would require proponents to acquire $14M in
equity financing. If in this case the proposed production facility was able to acquire the maximum
local partnership and applicable eligibility for their project and could apply under both a federal
and a complimentary provincial program, the combined loan could conceivably be a significant part
of the financial application and process (bankable). This contribution, combined with a proponent
contribution would provide the proposed owners with the ability to borrow the balance from a
traditional lending source and proceed with the construction and build of their project.
This recommendation is potentially of little or no cost to governments and tax payers, as this is a
repayable loan. Furthermore, these loans could be held by the lenders (provincial and federal)
pending the completion of a feasibility study and overall approved financial package from its
investors/stakeholders and all other lenders, thereby mitigating further government risk. All other
approvals and commitments must be in place and both the federal government and the applicable
provincial governments could present a set of criteria that must be met prior to approval.
RECOMMENDATION #3
MATCHING FEDERAL & PROVINCIAL PRODUCTION INCENTIVES
Specifically:
Atlantic Biofuel Production Initiative: The Government of Canada introduces a production

incentive program for qualifying regional producers. Program eligibility would expire after
a regional production capacity of 325 million litres is met or upon a fixed date of program
eligibility applications.
Provincial Biofuel Production Initiative: The Provinces of NB, PEI and NS create and
introduce a Provincial production program initiative, with compatible terms, conditions and
time lines.
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Rationale for Production Incentives

Atlantic Canadas production of biofuels must be competitive with other production plants
throughout Canada and North America. To compete, the region must first be on a level playing
field. In order for the industry to succeed in this part of the country, it must be able to provide
quality product, at a competitive price, and at a guaranteed production volume. The minimum
production for domestic consumption within this region, based upon the blended amounts
suggested in recommendation #1 is well over 300 million litres per year. Production incentives can
secure the ability for local production to successfully meet its financial obligations, pay back its
loans and compete in the marketplace for the long term.
A good example of this kind of program at work is Natural Resources Canadas ecoENERGY for
Biofuels program, commonly referred to as ecoEnergy. Unfortunately as with other programs, this
region of Canada was not in the position to take advantage of ecoEnergy when it was available and
has missed its opportunity to level the playing field. Similar circumstances prevailed as mentioned
in recommendation #2.
The ecoEnergy program was designed to support the production of renewable alternatives to
gasoline and diesel and encourage the development of a competitive domestic industry for
renewable fuels. The program (now closed) provided an operating incentive to facilities that
produce renewable fuels. Even if the program was still open, it was only payable to production
plants that were producing; this region is only now evolving to committing to build plants that are
still 18 to 24 months away from being commissioned and perhaps slightly longer in terms of actual
production.
Even though the industry here is just now getting its legs, an Atlantic specific program that
provided a matching provincial / federal production incentive would be the final piece to ensure
industry development in this region. A program of this type might come into play Jan 1st, of 2016
(giving time for plants to be constructed, commissioned and produce name plate capacity volumes),
and a recommended time period for completion of the programs would be 5 years from its start. A
firm program close/expiry date will encourage proponents to move quickly from construction
phase to production phase. Appropriate time would be allocated at the front end to allow plants
time to build, but closing it off after 5 years, or a fixed period of time, commits proponents to
development, or risk missing the opportunity. Done properly, this region should meet the domestic
production capacity suggested in recommendation # 1 in approximately 7 or 8 years.
We further recommend that this type of program have a sunset clause and a maximum contribution
amount. An Atlantic incentive program would be of far less overall contribution than previous
national programming, and would occur over a reduced period of time comparatively. We also
would suggest simplifying the strategy, which would be a combined federal / provincial program in
order for proponents to receive the maximum contribution opportunity. The program could
contribute maximum cents per litre from the federal program, and a match per litre from the
applicable provincial program. The program would conceivably max at a fixed number of litres
and/or a fixed time line.
This is the first recommendation in this project that would result in a direct payout or cost to
government. However, as identified through the Gardner Pinfold analysis, the economic impact of a
biofuels industry of this scale, in this region, over a 5 year period, has the potential to exceed $1B.
The contribution for this type of program would only be utilized if the industry builds to the
recommended capacity suggesting that the anticipated economic benefit of over $1B would be
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realized by our local communities. This has the potential to be a very good investment with great
results.
RECOMMENDATION #4
ESTABLISH A REGIONAL WORKING GROUP COMPRISED OF INDUSTRY, GOVERNMENT
AND ACADEMIC REPRESENTATIVES
Specifically, the working group would have the following responsibilities and tasks:
Primarily, to consider the recommendations of this report and initiate a broader dialogue on
the potential for development of this industry in this region;
And further, to identify additional opportunities to participate in the national dialogues in this
policy area;
And continue to build relationships between, and across governments to further examine
programs and incentives related to bioenergy.
Seek to strengthen coordination, engagement and partnerships between industry,

government and academia, in particular with the respect to research and development, and
other technological innovation.
Identify other project-specific items on an ongoing basis that could be initiated and
implemented through the working group organization.
Rationale for Atlantic-Specific Research and Development

Atlantic Canada is a small region, both in terms of population and geographic proximity. To build an
industry consisting of 8-15 plants, development on a regional scale versus by individual province
just makes sense. An effective policy for industry development, on a regional scale, must come
through collaboration among all players in the region. Interprovincial and federal/provincial
relations will be not only valuable, but essential to this regions success.
In this industry, like many others, one of the key pieces in the puzzle is adequate, appropriate, and
applicable research and development. This is particularly true for this industry, at its current stage
of development. As Atlantic Canada emerges into the biofuels production arena, the region must
consider different technologies, feedstocks and overall applications to the future of this industry.
The background research required for this report has reinforced ACBCs understanding that
industry and academia must work together in order to progress together. Our members and our
stakeholders recognize that R&D is not only important, but essential, and when done in
consultation and partnership with industry has the potential to yield impressive and economically
beneficial results.
In many ways, this region has an advantage with ready and multiple site access to the ocean (ports),
road systems and rail. This region also has a diversity of naturally abundant feedstocks including
forestry, agricultural energy specific crops, seaweed, algae and much more. With these, comes a
multitude of regional researchers leading the way for new technologies to make the best value of
our natural resources.
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Though listed last in the report, this recommendation could in fact be the most important; by
bringing together government partners, facilitating research and development, and building a solid
foundation for progress, this working group will be the catalyst to eventually drive forward all
recommendations in this report and bring the Atlantic Canada biofuels industry to a whole new
level.
Together, the recommendations represent a long-term, committed and documented interaction

with biofuels and bioenergy stakeholders through the New Brunswick, Prince Edward Island and
Nova Scotia, as well as national and regional input from an informed and dedicated community of
industry leaders and supporters.
ACBC and its membership are confident that these recommendations demonstrate the first
collaborative effort of an organized and established pan-Atlantic industry group.
This report clearly indicates that accepting, approving and implementing all of these
recommendations will provide the right circumstances to create exciting opportunities and positive
change for this region of Canada.
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Communicating the Results & Recommendations

Key to the success of this project is communicating the report its findings and recommendations
with stakeholders in Atlantic Canadas biofuels industry.
Project managers maintained communication with Federal and Provincial New Brunswick, Prince
Edward Island and Nova Scotia government officials, and industry proponents, throughout its
duration, to keep everyone informed and gather preliminary feedback to the recommendations
prior to public release.
The findings of this project will presented to stakeholders in June 2013, in conjunction with a media
event for public release.
Following that, ACBC and its membership will continue to communicate with stakeholders to
implement the recommendations and drive industry development. This will include: public
meetings for interested communities, potential feedstock suppliers and primary producers, as well
as potential investors and lenders; individual or roundtable discussions with government officials
and policy makers; and ongoing media relations activities to provide updated information on
industry development and correct misinformation.
These communications activities are designed to be delivered through ACBC and its Board of
Directors, as the representative association for the industry.
Conclusion
This report is the result of a comprehensive project spanning 14 months of research, engagement
and information sharing to the ACOA team and regional stakeholders. It details numerous findings
and proposes four recommendations that hold great economic promise for Atlantic Canada and its
stakeholders in the biofuels industry.
Together, the recommendations represent the first collaborative effort of an organized and
established pan-Atlantic industry group a long-term, committed and documented interaction with
biofuels and bioenergy stakeholders throughout New Brunswick, Prince Edward Island and Nova
Scotia, as well as national and regional input for an informed and dedicated community of industry
leaders and supporters.
This report clearly indicates that accepting, approving and implementing these recommendations
will create exciting opportunities and positive change for this region of Canada.
This report has been prepared by the Atlantic Council for Bioenergy Cooperative Limited (ACBC) in
collaboration with BioAtlantech, New Brunswicks lead bioscience agency, with all reasonable skill,
care and diligence, and taking account of the resources devoted to it by agreement with the client.
Information reported herein is based on the interpretation of data collected and has been accepted
in good faith as being accurate and valid.
85
Atlantic Canadas Bioenergy Opportunities Project - APPENDICES
APRI No. 200344
APPENDICES
Atlantic Canadas Bioenergy
Opportunities Project
Project Report
APRI Project No. 200344
Atlantic Canadas Bioenergy Opportunities Project Appendix A
APRI No. 200344
APPENDIX A STAKEHOLDER SURVEY SUMMARY OF RESULTS

Company / Entreprise
#
Response
1.
SCA - www.suschemalliance.ca
2.
Atlantec BioEnergy Corporation - www.atlantecbioenergy.ca
3.
Genome Atlantic - www.genomeatlantic.ca
4.
Randy Pointkoski -
5.
ADI Group Inc - www.adi.ca
6.
Carl Duivenvoorden Consulting - www.changeyourcorner.com
7.
James McClare Consulting - www.jamesmcclareconsulting.ca
8.
Solarvest (PEI) Inc. - www.solarvest.ca
9.
Co-op Atlantic
10.
Steelcraft Inc. - Clemmer Containment Div, Engineering Products Div, QCI Div. - www.steelcraftinc.com
11.
Nova Scotia Co-opeative Council - www.nscoopcouncil.ca
12.
BioAtlantech - www.bioatlantech.nb.ca
13.
Atlantic Algae Energry
14.
Price Landscaping Services - www.pricelandscaping.ca
15.
New Brunswick Forest Products Association - www.nbforestry.com
16.
AECOM - www.aecom.com
17.
Maritime Biofuels, Inc. - www.maritimebiofuels.com
18.
Ross Scinergy Inc.
19.
Wood Science & Technology Centre (Canadian Bioenergy Centre) - www.wstc.unbf.ca
20.
GreenValue Technologies Corporation - www.greenvalue-sa.com
21.
Atlantic Agri-Food Associates Inc
22.
BioNova - www.bionova.ca
23.
Diversified Metal Engineering Ltd - www.dmeinternational.com
24.
Chaleur Green Energy Cooperative Ltd
25.
Jamestown Lumber Company Ltd.
26.
New Brunswick Federation of Woodlot Owners - www.nbwoodlotowners.ca
27.
PEI Federation of Agriculture - www.peifa.ca
28.
Laforge Bioenvironmental Inc.
29.
APRI No. 200344
30.
Verschuren Centre for Sustainability in Energy & the Environment, Cape Breton University www.cbu.ca/csee
Carleton Ag Fuels Inc.
31.
NBSCIA - NB Soil & Crop Improvement Association - www.nbscia.ca
32.
Montana Microbial Products - www.mtmicrobial.com
33.
Cavendish Farms - www.cavendishfarms.com
34.
Avitas Holdings Ltd.
35.
Wilsons - www.wilsons.ca
36.
BioEnergy Inc. - www.bioenergyinc.ca
37.
CelluFuel Inc - www.cellufuel.com
38.
College Communautaire de Nouveau Brunswick Biorefinery Scale-up Researech Centre
39.
Coastal Zones Research Institute - http://www.irzc.umcs.ca/flash_content/anglais/plan_site.html
40.
Milco Enterprises Inc.
41.
Viable Energy Solutions
42.
SF Rendering
43.
Groupe Savoie
44.
Complete Senergy Systems
Province
Response
Chart
Percentage
Count
New Brunswick/Nouveau-Brunswick
50%
22
Newfoundland and Labrador/TerreNeuve-et-Labrador

Nova Scotia/Nouvelle-cosse
2%
30%
13
Ontario
2%
Prince Edward Island/ le-du-Princedouard
16%
Total Responses
44
Brief description of your company or organization :

#
Response
1.
Green and sustainable technology investor
2.
ABC is a pre-commerical 300,00 litre closed loop research & development facility which the primary
feedstock is energy beets.
Genome Atlantic is in the gene discovery business. We help develop, invest in and manage large scale
gene discovery projects throughout Atlantic Canada. But not just any gene research; we focus on areas
that can have solid social and/or economic impact. So, through the efforts of our project teams, were
looking for: Genes that will help us find better ways to diagnose and treat illnesses, so we can reduce
our health care burden and make our citizens healthier. Genes that identify healthy fish so our
3.
4.
5.
6.
7.
8.
9.
10.
APRI No. 200344
aquaculture producers can raise competitive, sustainable and delicious products. Genes in organisms
that can produce green fuel so we can lessen our demand on traditional fuels These are just some
examples of the kinds of things were interested in. Based on our discussions with industry, government
and academic stakeholders, we know that there are many more ways that genomics (i.e. gene research)
can help our region and the world solve some of its biggest problems. Were always eager to discuss
new opportunities.
Agricultural Engineer with Praire Farming Background. Exploring crop production opportunities and
systems for Central Cape Breton. Interests include responsible land use, community economic
development, alternative energy opportunities and options.
Industrial Wastewaste Treatment and Waste-to-Energy solutions
Speak, write and consult on environmental and energy issues; help companies and organizations learn
how they can save moeny, energy and the environment
Chemical engineering firm providing process engineering services to industries, government agencies and
others in the processing of biologically based materials. Process design and commissioning, feasibility
studies, technology evaluation, process and plant upgrading and improvements.
Solarvest is a Canadian owned R&D company focused on developing a process for the production of
hydrogen gas and high value proteins from our patented microalgae strain. Solarvest is also involved in
developing a sustainable alternative to fish oil from algae through the use of in house algae expertise and
technology.
Wholesale / retailer of consumer products
11.
Steelcraft has been in buisness since 1923 and is divided up into three (3) Divisions and assoicated with
the design and manufactureing of the following items: 1) Clemmer Containment Division - Liquid and drys
stroage tanks, pressure vessels, silos, turnkey systems fuel systems, 2) Engineered Products Division pressure/process vessels and reactors, heat exchangers, autoclaves, quick opening doors, 3) QCI Division heavy fabrications and sheet metal components for the heavy equipment manufacturing market. Please
view our website at www.steelcraftinc.com
Provincial economic development agency for the co-operative and credit union sector of Nova Scotia.
12.
biotechnology support and incubation
13.
Algae to bio fuel processing
14.
We are a landscape design, installation and maintenance company in business over 43 years.
15.
Forest Industry Association. Representing Sawmills and Pulpmills
16.
AECOM
17.
Recycling, Reprocessing and Bio-conversion Technology Developer and Adaptor. Primary focus in on the
development and implementation of renewable fuels production technology. This focus is based on
economic and environmental sustainability principles.
Consulting on technical issues in the bioproducts arena. Primary focus is on emerging algal cultivation and
processing technologies. As well, developing novel ethanol fermentation system for biofuel production.
The Canadian BioEnergy Centre (CBEC) operates with a mandate to provide technological support to the
bioenergy sector in Canada and beyond. Our goal is to promote the sustainable and responsible use of
forest and agricultural bioresources for a diversity of goods and services. This is accomplished through:
Research and development Product testing and certification (e.g. fuel pellets and biomass combustion
appliances) Technology transfer Training and education
GreenValue is in the business of producing value added fractions from biomass. The company has
developed a commercial line of high-purity lignin derivatives that are used in green chemistry and animal
nutrition and is working also in hemicellulose derived products. Current production and sourcing is
outside Canada, but one of the companys targets is to establish Canadian sourcing and production
Agricultural consulting specializing in business planning, feasibility analysis ,technical development and
18.
19.
20.
21.
APRI No. 200344
crop production.
22.
30.
BioNova is Nova Scotias life sciences industry association representing companies and research
organizations in all parts of the provinces bio-economy.
Incorporated in 1991 by company President Peter Toombs, Diversified Metal Engineering Ltd.s roots
began in the custom design and fabrication of equipment for Brewing, BioTech, BioEnergy Industrial Food
& Beverage, Water Treatment, Decor and Marine Applications. Corporate headquarters are located in
Charlottetown, Prince Edward Island where the company typically employs between 40 and 60 full time
staff.
We are a cooperative that plans to produce hay and wood pellets for the energy market and will explore
other markets for our products as well.
Operated logging and sawmill business 1974 2008. Ceased operations due to collapse of global lumber
and pulp fibre trade.
Federation representing woodlot owners in NB through the 7 regional Marketing Boards. Central body in
liaison with government on issues pertaining to woodlot owners. Administrator of provincial silviculture
program. Representative to Canadian Federation of woodlot Owners
The PEI Federation of Agriculture represents over 600 farm members with over $400 million in farm gate
sales. We also represent 12 commodity organizations across PEI. The Federation of Agriculture is
mandated to improve the lot of farmers on PEI.
Biogas Plant- Producing Biogas with cow manure, organic waste from commercial industry and converting
remaining of waste into an excellent source of fertilizer.
Cape Breton Universitys Verschuren Centre for Sustainability in Energy and the Environment was
established to find innovative and sustainable solutions to energy and environmental issues, one of the
foremost challenges of our generation. The Verschuren Centre is developing solutions through research,
innovation and partnerships while identifying opportunities for commercialization, for the sustainable
development of our community.
Business Plan stage
31.
We are a not-for profit agricultural association engaged in adaptive research and producer education.
32.
33.
Biological process development and commercialization. Process to produce protein concentrates and
ethanol
Potato Processing Company.
34.
Bio-industry Product Development
35.
Fuel Marketer
36.
Production and development of renewable energy equipment and products.
37.
CelluFuel Inc. is a Nova Scotia company focused on pioneering the commercialization of renewable fuels in
Eastern Canada.
Applied Research primarily focused on working with the private sector to commercialize bioenergy and
bioprocessing technologies or to implement these technologies with bioresource companies needing to
diversify. Examples of research: biodiesel from waste cooking oil; ethanol from sugar beets; ethanol from
waste alcoholic beverages; ethanol from waste potatoes; biogas from processing waste and agriculture
residues.
The Coastal Zones Research Institute Inc. (CZRI) is a private non-profit institution affiliated with the
Universit de Moncton, Shippagan Campus (New Brunswick). It was incorporated in December of 2002,
and has been under the direction of Gastien Godin since April 2005.
Logistics, warehousing and recycling of beverage containers (pop, beer, wine, spirits). Contracts with all
the major liquor commissions and pop distributors/producers in the Maritimes.
Biogas Research Company involved in the design of small scale anaerobic digesters for farms and
processing facilities. Our goal is to provide a turn-key biogas plant that is easy and safe to operate.
23.
24.
25.
26.
27.
28.
29.
38.
39.
40.
41.
APRI No. 200344
42.
Rendering and related activities. Family owned.
43.
Groupe Savoie is a family business employing over 500 men and women who strive to offer you
recognizably superior quality in hardwood products at unbeatable prices. Since 1978, we have nurtured a
positive and long-term relationship with many enthusiastically satisfied customers in North America,
Europe and Asia.
Complete Senergy Systems is a Design Build/Manufacture and Maintenance Company for Biogas Systems
(providing components or turnkey systems). Focus on Anaerobic Digesters (mixers, heating); waste
handling/waste feeding; power generation (genset); gas upgrading; biogas compression for transportation
fuel; nutrient recovery. Also has capacity and experience is manufacturing components for ethanol,
biodiesel and biomass energy systems.
44.
What is your Bioenergy area of interest?
Response
Chart
Percentage
Count
Ethanol/thanol
57%
25
Biodiesel/Biodiesel
55%
24
Biogas/Biogaz
50%
22
Biomass/Biomasse
57%
25
Other, please specify.../Autre,

prcisez ....
32%
14
Total Responses
44
What is your Bioenergy area of interest? (Other, please specify...)

#
Response
1.
See below
2.
Hydrogen
3.
pressure vessels
4.
all of the above
5.
all of the above
6.
Pyrolysis & Gasification
7.
algae
8.
pellets, briquettes and producer gas
9.
10.
Synfuels from biomass gasification, value added products from biomass Torrefaction, and the
establishment of the bioenergy and bioproducts industry are all of interest.
hi value protein co-products
11.
Pellets
12.
Torrefaction and Green Carbons
13.
renewable diesel
14.
feed ingredient co-products of fermentation
APRI No. 200344
Comments:
#
Response
1.
We are interested in any area of Bioenergy where genomics could play a role to enable end
users/companies to create economic impact for the sector/Atlantic region.
Working with two demonstration sites growing Soybeans, Sunflowers, and camillina in Central Cape
Breton. Supplimental home heating with Wood.
Ethanol, Biodiesel, Biogas all have wastewater treatment applications.
2.
3.
4.
5.
I'm interested in anything that has a favourable life cycle analysis that helps us toward a goal of
eliminating the use of fossil fuels
We support our members who are interested in all of the bioenergy areas listed above.
6.
See attached brochure for project examples
7.
Ethanol production is at lab scale and so I am not currently a producer and thus skipped pages 3-5.
8.
9.
We are interested in bioenergy as a complement to our interest in production of chemicals and materials
from biomass
Experience in production and processing of biodiesel and biomass from crop to finished product.
10.
Interested in BioFuels especially those derived from terrestrial and marine plants
11.
Our members traditionally are producers of forest products to mills. (round wood)
12.
Many of our members are interested in the various forms of bio-energy and produce feedstocks that may
be applicable to a variety of energy systems.
Protein concentrates from barley as the primary value, ethanol as coproduct. Economics superior to
conventional ethanol and distillers grains
I am an animal nutritionist with expertise in development and nutritional evaluation of innovative raw
materials for application in fish feeds.
Currently do not produce Biodiesel or Biogas. Have an ongoing interest in their production as economics
allow.
biomass = waste wood *Laforge Bioenvironmental is a 50% partner in Complete Senergy Systems.
Laforge Bioenvironmental is a producer of green electricity form Biogas.
13.
14.
15.
16.
Are you a producer of Bioenergy?

Response
Chart
Percentage
Count
Yes
25%
11
No
75%
33
Total Responses
44
What is your product?
Response
Chart
Percentage
Count
Ethanol/thanol
20%
Biodiesel/Biodiesel
10%
Biogas/Biogaz
40%
Biomass/Biomasse
40%
Other, please specify.../ Autre,

prcisez ...
APRI No. 200344
10%
Total Responses
1
10
What is your product? (Other, please specify...)

#
Response
1.
Hydrogen
What is your production capacity for each product?

| Ethanol
#
Response
1.
0.3
2.
500
| Biodiesel/Biodiesel
2000
| Biogas
#
Response
1.
1752
2.
20,000,000 m*3
3.
4380 MWH/hr
| Biomass
#
Response
1.
5 cords
2.
experimental
3.
2-3 tonnes per
4.
1500-5000 tonnes
| Other, please specify...

#
Response
1.
targeting 30 lbs oilseed for 2012
2.
R&D Scale
APRI No. 200344
If you intend to increase production capacity, please specify / comment:

#
Response
1.
Our intent in fiscal 2012 is to sign a development agreement to begin to construct in 2013 a 25 million litre
facility in the Maritime region.
as opportunities for commercial development unfold, crop production and processing capabilities will be
evaluated.
Not possible to expand production capacity due to low sale value of product vs. feedstock cost(s). The
feedstock(s) cost more than the product can be sold for.
Collecting more organic waste
2.
3.
4.
5.
6.
Our research, development and commercialization program will continue to evolve and expand with time.
Please contact me to discuss if you wish.
Yes we intend to increase capacity to meet consumer demand
7.
Currently investigation options to increase capacity.
Which statement best describes you?

Response
Chart
I intend to become a bioenergy

producer Je souhaite devenir
producteur de bionergie
I am an academic researcher whose
work is relevant to the bioenergy
sector Je suis chercheur en milieu
universitaire dans un domaine
affrent la bionergie
none of the aboveAucun de ces
noncs
Percentage
Count
27%
12%
64%
21
Total Responses
33
If you do not intend to become a producer, please describe your interests in the Bioenergy
sector:
#
Response
1.
Investor
2.
See previous comment on the use of genomics.
3.
Our treatment and waste-to-energy solutions can be intergrated into bioenergy producer's value chain.
4.
I speak and write about developments in the transition to a low or (ideally) no carbon economy.
5.
6.
To provide preliminary process engineering and capital cost estimates and other technical services for
clients involved in or intending to be involved in biofuel production.
re-seller of atlantic produced energies. ecomomic generator for the region
7.
Support our members who are involved and/or interested.
8.
I believe that it holds great promise for our region.
9.
purely from an personal interest point of view and options for our related industry partners
10.
Many of our members have interest in the sector and potential new products.
APRI No. 200344
12.
I am also interested in the sector as a consultant.
13.
The Canadian Bioenergy Centre as part of WSTC conducts basic and applied research related to the
production, quality and utilization of solid biomass for bioenergy. We also provide certified testing
services (we are an accredited lab for PFI and can conduct tests that meet the new EN-Plus pellet
standards).
We are interested in bioenergy as a complement to our interest in production of chemicals and materials
from biomass
Consulting on the economics and feasibility of feedstock and competitive position of renewable energy fro
primary agriculture.
Support of NS companies developing biofuels, if requested.
14.
15.
16.
17.
18.
DME is process engineering supply firm to the biofuels industry. We design and fabricate biofuel pilot
plants.
Our members are potential suppliers of raw material for the industry.
19.
Our members are the folks that produce energy and the products required for the bio-energy sector.
20.
21.
We would be interested in partnering in the adaptive research necessary to advance the industry and in
communication this information to producers.
I intend to become a producer in Atlantic Canada as well as the mid-west US
22.
We are a potential marketer of bioenergy
23.
We are currently working on the deployment of a viable next-generation technology converting woody
biomass to renewable diesel fuel.
Add value to co-products from fermentation plants.
24.
25.
Viable Energy Solutions is a Prince Edward Island company whose purpose is to develop and market a
small-scale biogas production plant that can be used by farmers and facilities. This plant will turn
agricultural waste into useable fuel for heat and production of electricity.
If you intend to become a bioenergy producer, check applicable product:

Response
Chart
Percentage
Count
Ethanol / thanol
38%
Biodiesel / Biodiesel
23%
Biogas / Biogaz
15%
Biomass / Biomasse
54%
Other, please specify... /Autre,

prcisez ...
31%
Total Responses
13
If you intend to become a bioenergy producer, check applicable product:

#
Response
1.
ADI Technology can be intergrated in Ethanol, Biodieasel, and Biogas
2.
n/a
3.
Pellets
4.
renewable diesel
APRI No. 200344
Intended capacity for each product:

| Ethanol
#
Response
1.
N/A
2.
Uncertain as yet
3.
7.6
4.
250,000 litres/yr
5.
??
| Biodiesel
#
Response
1.
N/A
2.
>20M Lt
3.
??
| Biogas
#
Response
1.
1 MW of Electricity
2.
??
| Biomass
#
Response
1.
million tonnes planned
2.
6000 Tonnes
3.
not determined
4.
800,000 GMT
5.
>74,000mto
6.
1 MW of Electricity
| Other, please specify...

#
Response
1.
No specific target
2.
n/a
3.
6000 to 15000 tonnes
4.
5,000 MT protein concentrate
5.
>74,000mto
10
6.
APRI No. 200344
20 ML/Year
Describe your anticipated production facility :

#
Response
1.
2.
Steelcraft would provide competitive bids for the design, fabrication of tanks, vessels, mixers, heat
exchangers, etc, used in the future production facilities.
n/a
3.
Too early in the development phase to be able to address this and subsequent questions
4.
We are planning on 4 small pellet machines each capable of producing between 500 to 700 lbs per hour,
depending on density required. This is basically a pilot project and will be replicated in other areas if
succesfull. Studies have shown that the pellet mills must be close to the source of raw material, in this
case hay. Wood will be used if available in sawdust or shavings form.
We do not anticipate owning or operating a facility but could be supply partners. The volume referenced
above is the potential volume from woodlots of unutilized material.
Electricity generation and drying of feedstock for briquetting (torrifaction) . Future ammonia.
5.
6.
7.
Facility to produce barley protein concentrate and ethanol, first facility 7.6 ML ethanol 5,000 MT protein
concentrate, primary protein market in aquaculture feeds. Facility is similar to conventional ethanol plant
but with modified process flow and added enzyme treatment steps.
-Biodiesel processing from seed oil -Fuel pellets from biomass (proprietary) -Other non-fuel product from
waste product
demonstration plant 2013 commercial plant(s) from 2014
8.
9.
10.
Waste Conversion: 1) Ethanol recovered from Beer, wine and spirits 2) Biogas from waste pop
combined heat and power (electricity and heat) 3) Combustion of Waste Wood (Construction waste
wood) (Electricity and heat) 1) $1 million ethanol 2) $2 million biogas 3) $2 million waste wood
We anticipate producing bioenergy in the future with our access to wood waste.
11.
Specify anticipated total investment / capital cost for your production facility:
#
Response
1.
2.
0.5
3.
4.
12.5
5.
180
6.
7.
Number of Full-time equivalent employees (FTEs) anticipated for:

| construction phase:
#
Response
1.
2.
11
3.
3 to 4
4.
20
5.
100 - 150
6.
10
7.
50
APRI No. 200344
| operations phase:
#
Response
1.
2.
6 plus one supervisor
3.
3 to 4
4.
18
5.
>250 + feedstock supply (>400)
6.
7.
15
Briefly describe anticipated timelines for your planned pilot or demonstration plant:
#
Response
1.
n/a
2.
3.
1 year Research to validate process at laboratory scale In one year, will be able to assess future timelines
for pilot and demonstration scales
Late November or early December, 2012
4.
Next 3 years
5.
Pilot operation in Montana completed.
6.
Mid-2013 initial production. Full production Nov 2014.
7.
Currently operating a demo/pilot ethanol plant in collaboration with CCNB-BTSC (funded by NBIF, NRCIRAP)
We are looking 2 years out.
8.
Briefly describe anticipated timelines for commercialization of your production plant:

#
Response
1.
n/a
2.
See above response. Timelines will depend on partnerships to commercialize production methodology. It is
possible that the proposed system will replace existing fermentation systems
About 6 months after start-up
3.
4.
Time line dictated by financing. MMP has completed engineering, and could begin construction in Canada
with financing and final site selection. Estimated time for construction is 9 to 12 months depending on
seasons and start date.
12
APRI No. 200344
5.
N/A. (Off-take contracts in place for +70% of product.)
6.
Commercial production of all 3 bioenergy products 2014 (financing, construction and commissioning in
2013)
Initially we will use the energy in-house but would like to explore production of ethanol and green diesel.
7.
What is your estimated start date for commercialization of production?

#
Response
1.
n/a
2.
See above. Have not built commercialization strategy yet
3.
About 6 months after start-up
4.
Mid-2013
5.
2016
Estimated annual revenue at commercialization phase:

#
Response
1.
2.
1000000
3.
1500000
4.
10.5
5.
80,000,000
6.
Are you a Biomass producer?

Response
Chart
Percentage
Count
Yes
27%
12
No
73%
32
Total Responses
44
Do you produce any of the following feedstocks?

Response
Chart
Forestry biomass / Biomasse

forestire
Agricultural biomass / Biomasse
agricole
Total Responses
Percentage
Count
56%
67%
6
9
13
APRI No. 200344
What type of feedstocks do you produce?

Response
Chart
Percentage
Count
tree thinnings / claircies darbres
27%
barley / Orge
9%
corn / Mas
9%
grasses / Herbages gramins
27%
soy / Soja
18%
agricultural waste / Dchets agricoles
18%
Other / Autre
73%
Other / Autre
9%
Other / Autre
9%
Total Responses
11
What type of feedstocks do you produce? (Other )

#
Response
1.
forestry biomass
2.
dedicated fast growing tree stock, plantations
3.
willow
4.
canola
5.
potato processing waste
6.
waste wood construction waste waste pellets
7.
animal rendering
8.
wood waste

#
Response
1.

#
Response
1.
14
APRI No. 200344
comments...
#
Response
1.
We currently have >122,000 m3 of clean, separated piles of biomass stored outside on freehold property,
an industrial site with, 600 V. 1600 amp
We should not just talk thinnings; we have underutilized species and low quality stems that could be
directed to biomass.
2.
Describe your feedstock(s). In what quantities are they produced?

#
Response
1.
5.
currently - .5 acres of row crop production (2 sites for seeds 8 acres readily convertable to agricultural
production. 90 acres Wood lot land growing natural biomass
We make about 1000 tonnes of silage and hay on about 350 acres of land for our livestock and for sale and
produce only about 15 % of the 30 cords of wood we use to heat our greenhouse operation
We currently have >122,000 m3 of clean, separated piles of biomass stored outside on freehold property,
an industrial site with, 600 V. 1600 amp
Private woodlots in New Brunswick are 1.73 million ha. From a study done a few years back there is
potential of 800,000 GMT of biomass.
Barley 360 tons per/year Grass 500 tons per/year Agricultural waste 4000 tons per/year
6.
9 Acres
7.
400 acres of field crops
8.
not willing to share
9.
Waste wood Construction and demolition waste Waste pallets
10.
1500-5000 tonnes per year
11.
20 million FBM (48,000 m3)
2.
3.
4.
If you know the anticipated energy per unit, please provide:

#
Response
1.
A tonne of hay pellets produces well in excess of 10 million BTU
Would you be able to increase your biomass production if a market existed? Seriez-vous en
mesure daugmenter votre production de biomasse sil existait un march?
Response
Chart
Percentage
Count
Yes
91%
10
No
9%
Total Responses
11
15
APRI No. 200344
comments...
#
Response
1.
A lot of farmland now underutilizes or laying idle could be brought in production if a fair price was offered.
2.
3.
Of course the yes is dependent on where the market is. Also as I am sure you know the forestry sector has
taken a beating so there may be some capacity issues (human resources) and of course price will always be
a factor.
we produce for our own consumption
4.
Maybe.
5.
we are looking at increasing our capacity
What do you believe is the biggest hurdle for Bioenergy producers in Atlantic Canada?
Response
Chart
Percentages
Count
access to production systems
2%
capital cost of production facility
2%
competitiveness for our market size
0%
financing
7%
lack of applied research and

development
market and price of finished product
0%
18%
policy
18%
supply of feedstock
26%
10
technical aspects for growers and

processors
time and cost for research
development
2%
5%
Response
1.
2.
Access to capital and access to markets; no government support of clean tech/bioenergy as a viable
industry sector for the province. Still viewed by most as risky, not commercially viable, or untested new!
Biogas producers lack clean sources of substrate (feedstock). Low prices for power produced using biogas.
3.
Capital cost and a developed market for the end product.
4.
Capital costs related to production.
5.
Commitment
6.
Cost of R&D and engineering support. Skilled labor availability.
7.
Finance for plant construction.
8.
Government policy or lack thereof
16
9.
10.
11.
APRI No. 200344
Lack of viable technology for the second generation of biofuel products coupled with lack of defined
government support for biofuel projects.
Lack of vision + fragmentation (lack of coordination). = inertia. Just my humble opinion.
12.
Support but complacent resistance/ lack of focus by Public sector. Investment climate is not well defined,
results in lack of confidence by funds and other large investors.
The biggest hurdles are convincing people about the economic and environmental benefits to bioenergy
13.
Time for R&D. Capital costs / financing.
14.
15.
[access to production systems][technical aspects for growers and processors]- timely and cost effective
access to Bio energy production systems - A. machinery - preparing, planting, harvesting processing B.
what crop to plant c. how to grow? cost and time to access the above
[financing][supply of feedstock]Financing
16.
[financing][supply of feedstock]financing
17.
18.
[market and price of finished product]1. Costs to research to get to production scale 2. Market for
finished product
[market and price of finished product]Market and Price of finished product.
19.
[market and price of finished product]Profitability.
20.
[market and price of finished product]all the above plus cost competitiveness for our market size,
21.
[market and price of finished product]public perception of product value and use. value of product in
small engine use. water problems with ethanol products under storage conditions
[market and price of finished product][financing][capital cost of production facility][supply of
feedstock]There are many challenges to the industry, which are all critical to its prosperity, including: Demographics, including the supply of labour, domestic market, and development of proponents - Capital
(particularly with the threat of labour shortages and related high costs, making competitiveness for FDI an
issue). - Product-to-market infrastructure and supply base, which is an additional development weight on
the shoulders of the few pioneering entrepreneurs and supporters in the industry.
[policy]Benchmarking,Logistics, Legislation: How much feedstock is available for Bioenergy companies in
the atlantic provinces? This means food waste, ag waste, biomass, available land, etc,...If that was known
then companies in the bioenergy sector could make forecast of whether it is econimically feasible at the
time. Logistic needs to be facilitated. If food waste, for example, is available, where does it go and how
easily can it be diverted to a bioenergy producer. Legislation, must also facilitate benchmarking and
logistics ie those who create it must measure it. This would be much easier task for commercial
businesses but also possible for residential if a Moncton source separation where done. Legislation around
source separation at least at the commercial level start would with a set tipping fee for disposal to a
bioenergy producer (tipping fee are already being paid)
[policy]Government will and interest. All land in NL is Crown. Therefore it is in the public interest to
manage, enhance and develop provincial forests. NL has an AAC of >2,100,000 m3 of softwood fibre. >
80% of forest fibre is unsuitable for solid wood products. The only current alternative outlet is newsprint
which consumes 600,000 m3. Most large energy users in NL are public institutions; schools, hospitals,
universities. Energy generation is vested in Nalcor, a Crown corporation. Nalcor relies significantly on
Bunker C at Holyrood generating station, one of the larger CO2 emitters in
[policy]Lack of Government leadership to create legislation appropriate for a new industry.
22.
23.
24.
25.
26.
27.
[policy]Mindset of development, need appropriate sized projects in all regions to assist in the
development of the industry. Capital costs are clearly a hurdle, need to address long term pay back and
potential savings. Government needs to show leadership.
[policy]Obtaining long-term biomass off-take agreements and having access to patient capital. There is a
bit of a catch-22 as biomass producers may not want to sign long term agreements with a start-up and
capital may want to have those agreements in place in order to reduce risk to investors
17
28.
29.
30.
31.
32.
33.
APRI No. 200344
[policy]The absence of a strong government commitment to getting off fossil fuels. By being early
adopters in their own buildings and facilities and putting in place the right incentives, governments could
stimulate the market transformation we need. Related: no sense of urgency among the voting public to
get off of fossil fuels because status quo is just too easy.
[policy][market and price of finished product]Since there are a number of researchers at WSTC/CBEC the
following comments are a composite from several individuals: One of the biggest hurdles for bioenergy
producers ( especially pellet manufacturers) in Atlantic Canada is a lack of domestic market.
Consequently, most producers have to sell in bulk to the European markets which results in low prices
obtained (bulk commodity). We do not have the land area to effectively compete with the larger
provinces in the bulk commodity markets. There needs to be specific policy directives and if necessary
subsidies to promote the domestic market.
[supply of feedstock]Available Biomass. And impacts on forest harvest.
[supply of feedstock]Biggest hurdle is the classic chicken and egg argument. Initially there is insufficient
feedstock available to support a viable commercial start-up. The lead time required to develop the
feedstock is a killer for the initial start-up of a plant, unless it can be competitive with imported feedstock.
All of which must be undertaken in a competitive market., without a contract. In most cases research and
development is not the issue. The knowledge is available and can be transferred and adapted with
minimal effort. The problem is with the local or regional academic community, who sees this area as a
means to continued employment and often undertake or claim a need to research or re-cycle the known.
The R&D community needs to step beyond the technology transfer stage and tackle the real unknowns.
[supply of feedstock]Biomass availability
34.
[supply of feedstock]Supply of feedstock, capital costs are high, prices for electricity are low. Cost to
produce ag feedstocks vs. forestry. No where near enough volumes of feedstocks annually to run a
250,000 tonne economy of scale plant.
[supply of feedstock]Supply of feedstock,Capital cost of production facility,
35.
[supply of feedstock]Supply of feedstock.
36.
[supply of feedstock]Time and cost of research and development Market and price of finished product
37.
[time and cost for research development]Time and Cost for Research and Development
38.
[time and cost for research development]Time and cost for research and development considering any
biofuel plant constructed in the Maritimes must should meet the Advanced Fuel requirements under RFS2
in the USA.
What other challenges exist for producers in Atlantic Canada?

#
Response
1.
Time Regulatory
2.
Lack of government knowledge of the industry.
3.
Processing resources once crop is produced
4.
It is a small market, an over supply of power.
5.
Sustainable production of feedstock, so we are not just trading one problem for another or creating future
production issues. In particular, I think soil nutrient management is important - no net removals over
time.
Competing with others having economy of scale.
6.
7.
8.
Hurtles associated with GM organisms and the stigma they carry; as well as, access to reliable sources of
large scale ingredient supply.
obtaining the finacial backing
18
APRI No. 200344
9.
land use patterns - many small holdings
10.
support from existing supply chains, refinery adjustments for blending ethanol products
11.
Growing more biomass. Investments in silviculture.
12.
Knowledge
13.
Market acceptance of the finished product.
14.
Relatively low density of feedstock supply, which either increases transportation costs or reduces the size
of a production facility. As size matters, smaller facilities are less efficient than larger facilities.
There is a lack of coordinated R & D effort in the region. There is considerable competition among
academic institutions (and sometimes individuals within institutions) for limited resources. Likewise, the
efforts within provincial governments (agriculture vs natural resources departments) and among provinces
are fractured and uncoordinated. These sector silos need to come down. The reality is, provinces like
Ontario have significantly greater resources to work with and as such when they commence a R & D
project such as for biomass production systems or even economic feasibility studies, they dwarf our
fragmented efforts in Atlantic Canada. (of note the two significant reports recently produced by Ontario a)
Report on literature review of agronomic practices for energy crop production under Ontario conditions
and b) Literature review and study of energy market alternatives for commercially grown biomass in
Ontario . These are very comprehensive studies with considerable relevance on the Atlantic Canada
situation. Equally importantly, they illustrate the need for a more coordinated effort here.
Scale of production from start-up and even at the commercial production, the market is small. There are
too may opinions dividing a very small pie, and therefore it is difficult to get a critical mass.
Cutbacks in federal government support for research
15.
16.
17.
18.
19.
In the case of hay biomass for fuel, the appropriate furnaces have to be brought in to eliminate the clinker
problem and to handle the higher ash levels
Size of our potential market. Other energy sources are still relatively cheap.
20.
Market size Research dollars Climate
21.
Converting Biogas into 98% pure natural gas
22.
There are many challenges so many that it does no productive good to focus on the challenges.
Alternatively, we must look to the opportunities, and the pathways to that opportunity that we can open
and guide our industry participants toward development.
The cost to hire engineers and the lack of experience in production. Also adequate dry storage space. A
narrow window of harvest time. Distance to market and feedstock supply within a short distance.
Economy of scale, Finding good workers.
Marketing and our small size
23.
24.
25.
26.
Process energy, many potential sites do not have natural gas service. Feedstock in our case barley is
produced in different areas so transportation is an important issue in plant sitting.
Farming infrastructure financing. Does not relate well to new or modern uses for non-food crop.
27.
Market acceptance, price of product, proven operability, ratability, infrastructure
28.
Size of market and acceptance of renewable energy systems and products
29.
Raising the necessary capital for commercial projects due to associated business risks.
30.
Lack of policy and Atlantic specific programs for producers to access.
31.
Same as above
32.
Small Scale access to equipment; higher capital and operating costs. Only a few projects can access
cheap natural gas (low costs heat/energy source). Increases OPEX. Biomass sources are not the
19
APRI No. 200344
traditional ones (significant opportunity but need for technology adaptation innovation)
33.
Gaining access to feedstock and access to certain technologies
34.
Proper policy to stimulate the use of bioenergy. --- Finding proper technology and the risk that comes
with it. Gov can assist with new policies.
Programming and Policy - The biggest hurdle for Biogas - Electrical Generation is ability to obtain a power
purchase agreement and a fair price for the power. NS is the only province with a feed in tariff program
for green electricity. Also traditional banks continue to see these projects as high risk even though they
have been replicated many times over in Europe and North America.
35.
Other comments on obstacles to Bioenergy production:

#
Response
1.
4.
Find ways to be sustainable while gearing up the production systems. Find ways to support the
investment required to gear up productions systems.
I think it would be great if the Maritimes could secure a long term user and move forward. Over the years
i have received numerious RFQ's for Biofuel facilites in Ontario but only very few small facilites have been
constructed. All the larger facilites did not move forward when the Ontario Govnt. money grants were
eliminated.
relatively short growing seasons, though this is not insurmountable with appropriate species, such as reed
canarygrass
degree days for biomass production for cellulose ethanol options
5.
There
6.
Economic development planners and thinkers need to recognize the value of import replacement. Dollars
spent on energy imports could very easily be shifted to local renewable sources. If biomass fuel pellets
could be marketed on the basis of BTU value , they would be worth $100 per tonne more to the producer
and still not cost the consumer more for heat than furnace oil.
Not enough dry land. Some land available but cost to bring into production is too high ie. Tile, bush and
rock removal. Wasted funding on seminars, studies, that could be used to make a pilot plant.
We would be competing with large multi-nationals in the forestry and oil industry.
2.
3.
7.
8.
9.
10.
11.
Process energy, many potential sites do not have natural gas service. Feedstock in our case barley is
produced in different areas so transportation is an important issue in plant sitting.
This is a new/young sector and will require gov support and industry guidance in order to grow to its
potential.
More provinces (in Atlantic Canada) need to adopt Feed in tariffs for the production of renewable
bioenergy
Do you believe government (federal, provincial, municipal) can assist in the development of
a strong Atlantic bioenergy industry?
Response
Chart
Percentage
Count
Yes
100%
40
No
0%
Total Responses
40
20
APRI No. 200344
If Yes how and why:

#
Response
1.
Guaranteed loans
2.
Mandate use in every province and at every station.
3.
9.
-Financial Support for inititaives - regulator support for developments - Being active recommender of
projects as Stakeholder - provision participation to help secureside funding
It is up to the government to help benchmark what is available for feedstock. Should there be enough
continuous feedstock to support a bioenergy industry, ethanol, biodiesel, biogas legislate to use of it as it
becomes avaialble.
Lead by example: be early adopters. Also put in place incentive programs to stimulate market
transformation, then stand back and let it happen. Plus: a big role in educating the public on the need to
get off of fossil fuels to generate buzz and a sense of urgency.
Encouraging development of raw material supplies (oilseeds or utilization of forwst industry waste, for
example)
By providing tools to small businesses such as market analyses, HR support, and other such services to
help start-up companies to develop and grow. Also a transparent view of available funding programs and
how they interact so small companies do not need to dedicate personnel and time to navigating the
numerous and constantly changing funding landscape.
Government(s) must help create the vision and identify the value chain links; then legislate the
components appropriately. With uncertainty, potential producers will not take an open ended risk.
They can aid in the supply the start-up capital required for Engineering and to begin production.
10.
Enabling legislation, appropriate polices, innovation funding, research
11.
Facilitate development, purchase agreements for bio-energy, create enabling environment.
12.
research and development, marketing and promotion.
13.
Incentives and coordination. Removal of barriers, recognition of green energy sources as higher values
14.
By
15.
Governments should support the Atlantic Bioenergy Industry through the inclusion of incentives to
product the products. Atlantic Canada is too small to benefit from the RFS concept that was successful in
western Canada. Atlantic Canada cant operate on the large industrial scale as Western Agriculture. Nova
Scotia is unique in that, in the case of Biodiesel, there is an elimination of the Motive Fuel Tax for ASTM
specification biodiesel but there is no mandate to use the product. I would remove the Motive Fuel Tax
from Ethanol and Biodiesel in all the Atlantic Provinces as well as Provincially mandate that the Provinces
conform to the RFS National blending average.
By sharing the risk of the development of this industry by grants or loan guarantees, reduced taxes,
governments may influence the decision of investors to co-fund capital and R&D projects.
A regional approach must be taken interprovincial approach AND it needs to be resource based (NOT
agriculture vs forestry).
Create a level playing field for renewable bioenergy with all public incentives and regulation. Dont pick
wind or geothermal over biomass..
Support for R&D, pilot projects, procurement policies.
4.
5.
6.
7.
8.
16.
17.
18.
19.
20.
21.
If our bioenergy industry is based on annually renewable resources, then by necessity they will be small
community enterprises and the various government levels must provide impetus to finance these.
Policy, Incentives (programs), Investment
22.
Policy Bridge financing Research and Development
21
23.
24.
25.
26.
27.
28.
29.
30.
31.
32.
APRI No. 200344
Yes, by Funding for renewable energy. Because of the risk and cost, the bank does not like to support
client with new projects that are uncommon in the region.
Government can play a role in public policy and in public-private sector partnerships, thereby helping to
shoulder the load for the industrys development. They have been, and continue to play that role. I
believe it is up to industry to determine where the industry should go what is the vision, what are the
policy barriers, and what is both the blue sky opportunity and the pragmatic path to get to that end.
Just stop wasting money on seminars and studies and subsidize the capital cost of a pilot plant or plant.
Need someone in government to lead the way. Rally the farmers and foresters.
They could provide a climate or policy that would advance the industry. They can also fund pilot scale
plants to determine the best methods. Support for research, red tape reduction and policies.
Compared with US programs, assistance from Canadian government agencies seems more direct and
potentially useful.
Primary method is to educate the public on the benefits of bioenergy.
Promotion of bio-fuels, internally and publicly. Amending legislations to enhance/promote use. Adopting
Policy-Of-Use for all Public Vehicles, Departments, and employees.
They can but they have not. Energy usually requires policy support. Current policy does not support local
production. This needs to change.
Converting Government buildings to renewable energy sources such as wood pellets
34.
Developing policy and programs that support the section in Atlantic Canada so we don't compete with
other parts of the country.
work with industry and academia to develop policies that support the burgeoning sector in this region.
similar to how the sector was supported in Saskatchewan 15 years ago.
With capital risk investments because the industry needs to share the risk.
35.
Policy, programming and leadership
36.
37.
More government incentives need to be in place in order for this industry to grow along with education
for farmers to see the true benefits of on farm biogas production.
Increase the use of biomass at govt operated facilities.
38.
Developing policies and programming
39.
Policy and Programming primarily capital assistance programs and policy to create guaranteed markets
(mandates) Access to capital and access to markets; no government support of clean tech/bioenergy as a
viable industry sector for the province. Still viewed by most as risky, not commercially viable, or untested
new!
33.
If No why not?
There are no responses to this question.
22
APRI No. 200344
Any additional comments, recommendations and information are welcome. Please provide.
Thank you.
#
Response
1.
I believe Bioenergy will be a big part of our future energy mix and that's a good thing. My biggest concern
is that societal energy demand today is unsustainably high - meaning that, figuratively speaking, we'd need
to cut down every tree to be able to keep consuming the way we are consuming. I know it is beyond the
scope of this study and this organization, but overall reduction of energy consumption is a huge and
essential component of true sustainability.
keep up the good work
2.
3.
4.
5.
6.
The region needs an integrated approach to a common bioenergy strategy to create a critical mass of
expertise, feed stock and quality product for the market. The by-products of energy production must be
adopted by the livestock feed industry to maximize return to the primary producer.
MMP sees Atlantic Canada as a key part of the commercialization strategy for the barley protein ethanol
business. Our issue has been raising necessary equity capital to get started ether in Montana or Atlantic
Canada.
Thanks for the opportunity.
Complete Senergy Systems is a Design Build and Maintain company for Biogas systems (Digesters; waste
handling; biogas purification; electrical generation; biogas fuel compression; nutrient recovery).
23
Atlantic Canadas Bioenergy Opportunities Project Appendix B
APRI No. 200344
APPENDIX B ATLANTIC CANADA RESEARCH NETWORK

First Name
Last Name
Email Address
Location
Research Focus
Yonghao
Ni
yonghao@unb.ca
UNB; Limerick Pulp and

Paper Centre
Ying
Zheng
yzheng@unb.ca
UNB Chemical Engineering
Kecheng
Li
kecheng@unb.ca
Huining
Xiao
hxiao@unb.ca
Pulp and Paper

Integrated Biorefinery
(hemicelluloses, acetic
acid, lignin etc.);
Separation Technology
Green Fuels and
Chemicals (Hydro
treating; catalysts;
membrane separation;
chemical conversion of
biomass biocrude)
Surface science related
to pulp fibres; fibre
treatment; mechanical
pulping
Polymers
Laura
RomeroZernon
laurarz@unb.ca
Petroleum Biodiesel
Sean
McGrady
smcgrady@unb.ca
UNB Chemistry
Organic Chemistry;
Hydrogen Fuel Cells
Marc
Schnieder
mhs@unb.ca
Infinity Wood
Lignin based polymers
Muhammed
Afzal
mafzal@unb.ca
UNB Mechanical
Engineering
Wood Pellet and

Emissions
Kripa
Singh
singhk@unb.ca
UNB Civil and Chemical

Engineering
Water based treatment;

biogas
Ron
Smith
rsmith0225@rogers.com
UNB Wood Science Centre

- CBEC
Biomass and bioenergy

from woody and other
Thierry
Chopin
tchopin@unbsj.ca
UNB Saint John
Biomass Production
(Seaweeds)
Andre
Dumas
andre.dumas@umoncton.ca
CZRI
Jacques
Gagnon
jacques.gagnon@umoncton.ca
CZRI
Alex
Mosseler
amossele@nrcan.gc.ca
Canadian Forest Service
Production of High
Protein Fish feed from Ag
crops (grains, soybean,
canola, camelina etc.)
Bioprocessing/Extractive
s from fish processing
waste stream
(nutriceuticals, cosmetics
and bioactives)
Biomass Crops (fastgrowing native willows
as a potential biomass
feedstock)
APRI No. 200344
First Name
Last Name
Email Address
Location
Research Focus
Mike
Price
mike.price@gnb.ca
Biomass Crops
Ben
Forward
Ben.Forward@rpc.ca
NB Department of
Agriculture, Aquaculture
and Fisheries
RPC
Mike
Main
mmain@nsac.ca
Dalhousie, Agricultural
College Campus
Biomass Crops
Claude
Caldwell
ccaldwell@nsac.ca
College Campus
Grain Crops
David
Alderson
david_alderson@cbu.ca
UCCB Verschuren Centre
Tech Transfer
Gerry
Marangoni
gmarango@stfx.ca
St. Xavier
Stephen
O'Leary
Stephen.O'Leary@nrc-cnrc.gc.ca
NRC - IMB
Biofuel Analysis and

Testing (Biodiesel and
ethanol)
Algae Oils-Biodiesel
Ross
Guilders
ross.gilders@rpc.ca
RPC
Sara
Eisler
seisler@unb.ca
UNB Chemistry
Organic semiconductors
Om
Rajora
Om.Rajora@unb.ca
UNB Forestry &

Environmental Sciences
Kevin
Shiell
Kevin.Shiell@gnb.ca
CCNB CESAB
Conservation and
sustainable
management,
bioenergy/biofuel
production
Biorefinery: Ethanol
Andrew
Swanson
andrew_swanson@cbu.ca
Etienne
Mfoumou
UCCB Verschuren Centre

Program Director and
Distinguished Fellow in
Renewable Energy
NSCC: Applied Research
Algae, woody and green

power
Dalhousie Engineering
Biorefining for
sustainability
General Biofuels and
Bioenergy (Ethanol,
Biodiesel, Biogas, Algae)
Fermentation of biomass
e.mfoumou@nscc.ca
Abdel
Ghaly
Abdel.ghaly@dal.ca
Neil
Ross
Enzymes
Ross Scinergy
Bioeneryg, Enzyme
development
neilrossphd@gmail.com
Martin
Deepika
Vasantha
Tango
Martin.tango@acadiau.ca
Acadia, Biological
Engineering
Deepika.Dave@mi.mun.ca
Memorial University
Marine Institute
vrupasinghe@nsac.ca
College Campus
Dave
Rupasinghe
Biorefining for
bioproducts and
bioenergy
Bioproduct from marine
waste. Composting and
bioenergy
Bioproducts from
biowaste materials
(apples)
APRI No. 200344
First Name
Last Name
Email Address
Location
Research Focus
Jerry
Viel
gviel@unb.ca
UNB Wood Science Centre

Canadian Bioenergy Centre
Bioenergy from woody

biomass (primarily
pellets); combustion
analysis; quality analysis
Kenneth
Corscadden
kenneth.corscadden@dal.ca
Dalhousie University
Faculty of Agriculture
(Truro)
Quan
He
Quan.He@dal.ca
(Truro)
Biodiesel; Green Fuels

Agriculture and Forest
Biomass
Ilhami
Yildiz
iyildiz@dal.ca
(Truro)
Micro-Algae Production
Kevin
Vessey
Kevin.Vessey@smu.ca
Saint Marys University
Seed and Soil

Amendments for
Bioenergy Crops
David
Alderson
david_alderson@cbu.ca
Cape Breton University Verschuren Centre (CSEE)
Green Power
Gasification; Pyrolysis.
Biomass of focus woody
and marine
Patrick
McGinn
Partick.mcginn@nrc-cnrc.gc.ca
NRC -IMB
Algae to biofuels
Leo
Cheung
Leo.cheung@rpc.ca
RPC
Pyrolysis
Michael
McDougal
Michael.mcdougall@solarvest.ca
Solarvest
Hydrogen Production
from MicroAlgae
Alan
Critchley
Alan.critchley@acadian.ca
Acadian Seaplants
Exploring possibilities of
producing bioenergy or
biofuels from processing
waste
Ang Pee
Keng
Keng.pee.ang@cookeaqua.com
Cooke Aquaculture
Exploring possibilities of
producing bioenergy or
biofuels from processing
waste
Sara
Eisler
seisler@unb.ca
UNB Chemistry
Organic semiconductors
Justin
Crouse
NSCC: Applied Research
Biomass Resources
Kelley
Hawbolt
Memorial University
Chemical and petroleum

engineer. Waste to
energy biofuels.
khawboldt@mun.ca
APRI No. 200344
First Name
Last Name
Email Address
Location
Research Focus
Chris
Pharo
Chris.Pharo@agr.gc.ca
PEI AAFC
Bioenergy Crops
(Willows)
Hermant
Pendse
pendse@maine.edu
University of Maine
Lignicellulosic conversion
to biofuels, bioenergy
and bioproducts
Forest Bioproduct
Research Institute
Adrian
VanHeininigan
avanheininigan@umche.maine.ed
u
University of Maine
Forest Bioproduct
Research Institute
Peter
Vanwalsum
pvanwalsum@umche.maine.edu
University of Maine
Forest Bioproduct
Research Institute
Peter
McCarthy
pjm@adi.ca
ADI
and bioproducts
and bioproducts
Biogas and Waste Water

Treatment
Atlantic Canadas Bioenergy Opportunities Project Appendix C
APRI No. 200344
APPENDIX C THE CASE FOR CELLULOSIC ETHANOL

by Todd E. Alexander and Lee Gordon, Chadbourne & Parke | Published March 2, 2009 at 2:15 PM
Although current efforts to produce cellulosic ethanol are thought to be near fruition, there remains
considerable uncertainty about how fast it will become commercially viable. To date, no company
has been able to produce cellulosic ethanol in mass quantities at a cost that can compete with
starch- or sugar-based ethanol.
Yet, because cellulosic ethanol has the potential to significantly improve profitability and the
environmental benefits of using biofuels, efforts to achieve its commercialization continue.
In recent years, these efforts have been bolstered by investments in several cellulosic ethanol
producers by major oil companies, as well as by a variety of incentives the federal government
provides the industry. The effects of these investments and incentives are beginning to show, with
several commercial cellulosic ethanol facilities expected to begin construction or operations within
the next year.
Given the recent confirmation of Tom Vilsack as agriculture secretary and Steven Chu as energy
secretary, both of whom have been public advocates for the development of cellulosic ethanol,
support for the industry is likely to continue. Thus, despite several technical and financial hurdles
remaining, with continued private investment and federal support, the date on which cellulosic
ethanol becomes commercially viable should draw increasingly closer.
Cellulosic ethanol is produced from feedstocks that are not typically used as foods, including
residual nonfood parts of agricultural crops (corn cobs and sugarcane bagasse), residual parts of
forestry and waste products (wood chips and organic garbage), and nonfood crops (poplar and
switchgrass). The benefits of cellulosic ethanol are directly related to the feedstocks used in its
production. For example, because cellulosic ethanol is produced from abundant nonfood
feedstocks causing only minor changes in agricultural production, it is not expected to directly
increase the price of food. In addition, since it can be produced from feedstocks that are residual or
waste products, cellulosic ethanol often has significantly lower lifecycle greenhouse gas emissions
than petroleum fuels or starch- and sugar-based ethanol, and has yet to face criticism related to
indirect land displacement and the use of chemical fertilizers.
Of course, as with many emerging technologies, developers of cellulosic ethanol facilities have also
confronted what has been termed the "valley of death" -- the period in the development of a new
technology when it is susceptible to failure due to the difficulty in rising additional funding for
commercialization. During this period, developers face increasing demands on existing cash to fund
development expenses and decreasing abilities to raise additional cash due to an inability to
demonstrate a future cash flow. Traditional sources of equity may not be available during the valley
of death -- venture capital tends to provide financing once a technology has been shown to be
commercially viable, whereas private equity is typically interested in investing in companies that
are already operating and established in the market.
APRI No. 200344
Although several commercial cellulosic ethanol facilities are under construction, until such a facility
is built its total construction cost remains unknown. This lack of certainty has led to complications
in obtaining standard construction schedule, cost commitment and performance guarantees from
contractors. Without such guarantees, it may be difficult for developers to raise additional equity
and nearly impossible to raise debt from private lenders. Without access to additional funding
sources, developers will likely have to assume some of the risk for increased construction costs.
Additional cost issues arise from the uncertainty surrounding operating costs -- until a cellulosic
ethanol facility has reached commercial operations, the costs of producing ethanol from specific
feedstocks cannot be fully known. Currently, it is unknown whether such facilities will have
reliable access to biomass feedstocks, in particular those derived from crops, and the costs
associated with harvesting; sorting and transporting have not been fully quantified.
Where operating costs either cannot be determined or cannot be shown to decrease from the high
costs associated with current biochemical (where feedstocks are broken down into sugars through
the use of enzymes or chemicals) and thermo chemical (where feedstocks are broken down by
gasification) processes, developers may find it difficult to obtain additional funding to move
forward with development.
Further, high operating costs put pressure on working capital, which may result in developers
being unable to meet debt service requirements.
Another risk to commercialization is what has been termed the "blend wall." Currently, most
ethanol-gasoline fuel blends contain no more than 10% ethanol (a fuel known as E10) because
automakers take the position that using higher percentages of ethanol will void most vehicle
warranties. The total current annual market for ethanol in the U.S. is expected to reach the blend
wall by 2011 or 2012. The impact of the blend wall on cellulosic ethanol is of particular concern
given that most, if not all, cost projections for its production using current processes show that it
will not be cost competitive with starch- and sugar-based ethanol for several years.
One strategy developers adopted for dealing with the complications related to cost uncertainty and
funding shortfalls is to enter into a partnership or joint venture with an established company.
However, this requires identifying companies that are both willing to accept the risk associated
with the new technology and either have access to sufficient cash to support additional
development costs or can guarantee debt financing.
Several cellulosic ethanol developers have entered into such arrangements with major oil
companies, including BP plc in a strategic alliance with Verenium Corp., Marathon Oil Corp.
investing in Mascoma Corp., Royal Dutch Shell plc investing in Iogen Corp., Valero Energy Corp.
investing in ZeaChem Inc. and Sinopec (China Petroleum and Chemical Corp.) in a partnership with
Novozymes A/S.
Arrangements with existing companies build on the significant incentives the US federal
government provides to support commercial cellulosic ethanol production, including regulatory
mandates, tax credits and depreciation allowances, grants, and loan and guarantee arrangements.
The Energy Information Administration estimated that total federal support for all biofuels in 2007
totaled $3.6 billion.
Among the most important incentives is the renewable fuel standard, or RFS, a federal mandate
that requires increasing volumes of renewable fuels -- including advanced biofuels (fuels produced
APRI No. 200344
from non-corn feedstocks that have 50% lower lifecycle greenhouse gas emission than petroleum
fuels) and cellulosic biofuels (fuels produced from cellulose, hemicelluloses or lignin that have 60%
lower lifecycle greenhouse gas emissions than petroleum fuels) -- be blended into transportation
fuel in the U.S. each year.
In addition to the RFS, tax incentives play an important role. The two largest of these are the tax
credit of $1.01 per gallon for each gallon of cellulosic ethanol produced and a special depreciation
allowance equal to 50% of the cost of a new enzymatic process facility in the year that it is placed in
service.
Various grants, loans and loan guarantees the federal government offers to developers provide
another strategy for dealing with cost uncertainty and funding shortfalls. Among these is the
biorefinery assistance program, which provides loan guarantees of up to $250 million per project
through the U.S. Department of Agriculture to fund the development, construction, and retrofitting
of commercial-scale biofuel facilities producing advanced biofuels. Recently, the first loan
guarantee was provided under the program -- an $80 million loan guarantee to Range Fuels to
assist in the development of its commercial cellulosic facility.
Also of note, the U.S. Department of Energy administers a biomass research and development
initiative, which provides up to $200 million in grants for the development of biomass crops and
the construction of demonstration-scale biofuel facilities producing advanced biofuels, and a
biorefinery project grants program, which provides up to $186 million in grants for biomass
research and the construction of demonstration-scale biofuel facilities. To date, the U.S. Department
of Energy has provided funding for nine small-scale projects and four commercial-scale projects,
including an additional $76.3 million to POET to develop a commercial cellulosic facility (after an
initial $3.7 million investment).
These sources of federal funding increase the probability of commercializing cellulosic ethanol,
which offers a greener source for a large portion of our transportation fuels. However, to achieve
this goal, increased and continued support from both the private and public sectors will be needed.
Atlantic Canadas Bioenergy Opportunities Project Appendix D
APRI No. 200344
APPENDIX D CELLULOSIC BIOFUELS PRODUCTION & DEMONSTRATION

FACILITIES IN ATLANTIC CANADA
1. Atlantec BioEnergy Corporation, Cornwall, Prince Edward Island

GPS Location
44.5894444444,-65.4138888889
Location
Cornwall
Province
Technology
Patent Pending Technology
Raw material
Energy beets
Product
Ethanol, Electricity, Thermal heat, Water and Natural fertilizer by-product
Output
300,000ly
Facility Type
Demonstration
Status
Operating
Start Up
2011
2. Comet Biorefining Inc., London, Ontario

GPS Location
42.9794444444,-81.2461111111
Location
London
Province
Ontario
Technology
patent pending technology
Raw material
wood waste, switchgrass, and corn cobs
Product
cellulosic sugar
Output
unknown
Facility Type
demo
Status
planned
Start Up
2010
3. Enerkem Corporation and Greenfield Ethanol, Edmonton, Alberta
APRI No. 200344
3. Enerkem Corporation and Greenfield Ethanol, Edmonton, Alberta

GPS Location
53.5436111111,-113.490555556
Location
Edmonton
Province
Alberta
Technology
thermo-chemical conversion
Raw material
municipal solid waste
Product
ethanol and methanol
Output
36 million
Facility Type
commercial
Status
planned
Start Up
2011
4. Enerkem Corporation, Sherbrooke, Quebec

GPS Location
45.4005555556,-71.8836111111
Location
Sherbrooke
Province
Quebec
Technology
Raw material
municipal solid waste, wood waste, and treated wood
Product
syngas
Output
0.475 million
Facility Type
pilot
Status
operating
Start Up
2003
5. Enerkem Corporation, Westbury, Quebec
APRI No. 200344
5. Enerkem Corporation, Westbury, Quebec

GPS Location
45.5052777778,-71.6616666667
Location
Westbury
Province
Quebec
Technology
Raw material
treated wood
Product
syngas, ethanol, methanol, and biochemicals
Output
5 million
Facility Type
demo
Status
operating
Start Up
2009
6. Ferme Olivier Lpine Inc., St-Alexis, Quebec

GPS Location
45.9333333333,-73.6166666667
Location
St-Alexis
Province
Quebec
Technology
bio-chemical conversion
Raw material
Agricultural waste
Product
ethanol
Output
12 million
Facility Type
pilot
Status
unknown
Start Up
2012
7. Greenfield Ethanol Inc., Chatham, Ontario
APRI No. 200344
7. Greenfield Ethanol Inc., Chatham, Ontario

GPS Location
42.4025,-82.1886111111
Location
Chatham
Province
Ontario
Technology
bio-chemical conversion
Raw material
corn cobs, corn residues, and treated wood
Product
ethanol
Output
0.1 million
Facility Type
commercial
Status
planned
Start Up
2015
8. Growing Power Hairy Hill Limited, Hairy Hill, Alberta

GPS Location
53.7619444444,-111.976388889
Location
Hairy Hill
Province
Alberta
Technology
anaerobic digestion
Raw material
high-starch wheat
Product
syngas, ethanol, and electricity
Output
40 million
Facility Type
commercial
Status
under construction
Start Up
2011
APRI No. 200344
9. Iogen Inc., Birch Hills, Saskatchewan

GPS Location
52.9847222222,-105.438333333
Location
Birch Hills This project and all if rights are in control by Royal Dutch Shell.
As of 2012 this project is on hold. Royal Dutch Shell is still determining a
go or no-go as well as consideration of new technology updates prior to
commercialization. Location is also being reviewed.
Province
Saskatchewan
Technology
enzymatic hydrolysis
Raw material
wheat straw
Product
ethanol and electricity
Output
70 million
Facility Type
commercial
Status
planned
Start Up
2012
10. Iogen Inc., Ottawa, Ontario

GPS Location
45.4116666667,-75.6980555556
Location
Ottawa
Province
Ontario
Technology
enzymatic hydrolysis
Raw material
wheat straw
Product
ethanol
Output
1 million
Facility Type
demo
Status
operating
Start Up
2004
Atlantic Canadas Bioenergy Opportunities Project Appendix E
APRI No. 200344
APPENDIX E BIOENERGY TECHNOLOGY IN ATLANTIC CANADA

Enerkem is a private company co-founded by Dr. Esteban Chornet and Vincent Chornet in
Sherbrooke, Quebec, that develops biofuels and chemicals from waste using proprietary
thermochemical technology. Their primary focus is on commercial production of cellulosic ethanol
from MSW (municipal solid-waste). Enerkem has 2 operational facilities in Quebec (a pilot plant in
Sherbrooke and acommercial demonstration facility in Westbury), and three full-scale commercial
plants under development/construction: Edmonton (Alberta),Pontotoc (Mississippi), and Varennes
(Quebec).
Without Canadian input through SDTC, and the equivalent program in the U.S., Enerkem would not
be developing. Similarly, Enerkem is developing in other parts of Canada, because of the policy and
programming in place to fit its requirements, which does not exist in Atlantic Canada. Enerkem did
not even consider Halifax, for example, as an option, because it would have meant starting from
ground zero, when all the requirements already existed elsewhere.
ZeaChem is a U.S. based company headquarted in Lakewood, Colorado withsuccessful lab, pilot,
demonstration and commercial production.. Their technology involves fermentation, chemical
conversion (of forestry and agricultural biomass) and gasification of lignin to ethanol with a
production capacity of 10 BDT/d, 1MM LPY at their demonstration biorefinery and 650 BDT/d,
100MM+ LPY anticipated for their commercial refinery, which becomes operational in 2014.
ZeaChems demonstration plant has created 50 construction jobs and over 25 operations jobs, with
an anticipated additional 200 indirect jobs. It is expected that their commercial scale plant will
create a value of $14 M in the forestry industry and $75 M in product revenue.
Zeachem has a $232 M loan guarantee with the U.S. Government to drive this technology to
commercialization.
AlphaKat Technology Canada Inc. was formed in early 2012 as a Partnership between Alphakat
GMBH, based in Germany, and AGES Green Energy Solutions, based in British Columbia, Canada.
AlphaKat uses a technology called KDV catalytic low pressure conversion to oils, which converts
any input material containing hydrocarbons into fuels, including primary Diesel, Jet Fuel and other
middle distillates. This is achieved at atmospheric pressure and temperatures of between 280
320 degrees Celsius, using a patented ion exchange catalyst, which can be recovered again from the
ashes after going through the process. It is a completely closed process, with no emissions except
from the Genset unit supplying energy to the plant. The only by-products are distilled water and
ash, both of which have commercial applications.
The process efficiency of the KDV method is unparalleled in the production of bio fuels. On average,
85% of the hydrocarbon content of the input material is recovered, depending mainly on the
moisture content of the input material. The process requires no external input of energy and once
running, it operates on approximately 10% of the diesel from its own production.
The KDV process produces fuel that is different from ethanol and other bio-fuels, which are
restricted to input materials such as sugar, starch, and vegetable oil.
APRI No. 200344
KDV does not compete with food crops, nor does it take up valuable arable land. It also does not
create toxic emissions. It is a clean, efficient process. It produces Diesel of a higher quality than the
regular Diesel available at gas stations, withaCetane content between 58 to 62, compared to 52 for
regular diesel, and 55-56 for premium diesel. The volumetric yield of fuels produced using the KDV
method in litres per ha is double that of Ethanol, and 5 times that of other bio diesel. The Energy
yield per ha is 4 times that of ethanol, and 5 times that of other bio diesels. The net energy balance
(energy recovery from input materials) using the KDV process is 5 times better than for ethanol,
and twice that of other bio diesels. Even if using numbers from the smallest of the industrial KDV
plants, with the least economies of scale (the KDV 500), the production cost per energy equivalent
are 42% that of Ethanol, and 51% those of other biodiesels. In the larger KDV units, those numbers
improve further.
One of the main advantages of the KDV process over other bio fuel processes is the fact that it can
utilize most organic matter. No primary product (food crops, clean wood chips, etc) is required, and
the waste products of Industrial activity as well as food production are an ideal feedstock; for
example: biomass, all kinds of plastics and synthetic materials (PVC, PP, PET), solid municipal
waste and industrial waste, waste oil (also contaminated), refinery residues, bitumen, tar and
paraffin.
Alphakat uses a technology that works, but is not yet proven to be commercially profitable. This
concept deserves a serious look for feasibility, which will be explored in the Feasibility Model
section of this report.
Montana Microbial Products specializes in commercializing technology and products for use in
sustainable agricultural and aquaculture systems. The company works with microbial agents and
compounds discovered and developed by MMP, licensed from universities or others, and also does
contract research and development. MMP operates a fully functional microbiology lab and pilot
plant, using core technical competencies including isolation and selection technology, formulation,
solid and liquid fermentation, and process design.
They are currently working on developing a barley protein and ethanol plan in Atlantic Canada to
create a high protein concentrate for the global aquaculture market (fish meal). Fish meal is the
largest cost in producing farmed fish and is becoming increasingly expensive with increased
demand and depletion of ocean fisheries, now costing $800 to $1,200 per ton with price spikes up
to $1,400. In addition to cost and depletion of ocean fisheries, fishmeal also has two additional
undesirable environmental issues: pollution from the high phosphorus in the effluent from fish
farms, and concentrating organic contaminants into farmed fish. The barley protein concentrate
(BPC) is the first plant protein with both the nutritional quality and competitive cost to effectively
replace fish meal. The production of PBC also produces ethanol.
The patent pending production technology was developed by principals in MMP and the USDA/ARS
Fish Culture Experiment Station. Research was supported by the Montana Board of Research and
Commercialization.
MMP has developed two ethanol production technologies that 1) reduce capital and operating costs
for traditional starch (corn) to ethanol plants and 2) enable the efficient conversion to ethanol of
low lignin cellulose feedstocks such as corn stover, switch grass, and straw. These two technologies
can be combined into an integrated process that reduces feedstock cost and improves operating
efficiencies while reducing energy consumption.
APRI No. 200344
The enabling technology for these processes is MMPs proprietary fungal solid substrate
culture(SSC) technology. SSC allows low cost production of novel fungal derived enzyme
preparations designed specifically for use in biomass conversion.
These ethanol technologies have been licensed to AE Biofuels (aebiofuels.com)
Barley is used in wheat rotations to reduce fertilizer and chemical costs, improve soil productivity,
and help break sawfly and cheat grass cycles. Barley acreage has declined recently because of low
prices. MMP will pay a premium for barley used in the process, improving farm economics and
creating a value added agricultural product.
This project is an ideal example of value added consideration. The primary product is feed for the
fish industry, however it allows the opportunity of a significant amount of ethanol as a by-product,
which interestingly also uses a non-common feedstock that would not work on a standalone basis.
This multi-product facility could be a great opportunity for unique circumstances in Atlantic
Canada.
Maritime Biofuels Inc., located in Martock, Nova Scotia, is dedicated to the promotion and ongoing
development of an environmentally sustainable renewable fuels industry. Initial efforts are focused
on conventional renewable fuels development such as 1st generation Ethanol & Biodiesel.
To date, their technologies include: 2nd generation Ethanol and Biodiesel as well as Hydrogen,
Pyrolysis Oils, Biogas and Syngas. Their view is that renewable fuel production developments can
be based on a local production and consumption model that takes into account the sustainability of
flexible, regionally sized, small-scale facilities. This approach is intended to maximize the benefit
locally through job and resource creation while minimizing reliance on the adverse environmental
impacts of non-renewable fossil fuels.
SF Rendering Ltd. is a CFIA approved, 30 year old company operating in Port Williams, Nova Scotia
and St. George, New Brunswick.
Historically, SFR specialized in the manufacture of animal feed ingredients, but has diversified by
expanding into feeds for the mink / fur industry and pet foods.
Currently SFR is manufacturing biodiesel B100, for which the base feedstock is yellow grease
(WVO). This feedstock is in finite supply, and the company is currently researching expansion
through the development of an oilseed crushing facility. B100 fuels can be blended down to fulfill
client needs such as B2, B5, B20. The plant is now completing its pilot phase and moving to
commercialization.
Cellufuel Inc. is a Nova Scotia Based company that formed with the objective to become the
pioneer in the commercialization of transportation biofuels, based on woody biomass, in Eastern
Canada. This is a unique opportunity to create a sustainable and renewable diesel product that can
be blended with petroleum diesel in varying proportions.
After evaluating many technologies that convert woody biomass into various renewable energy
products, Cellufuel arrived at a patented technology that was developed originally within a large
technology company in Germany. It produces a renewable diesel that has the potential to meet
ASTM standards (ASTM D975 & D396). The technology has been deployed on a commercial scale in
APRI No. 200344
Mexico, United States, Canada, Africa and Europe with new installations underway in Europe and
Asia. Cellufuel has an exclusive license in Canada for woody biomass.
Many existing sources of biofuels such as ethanol or biodiesel are largely based on raw materials
that are grown on crop based acreage. These fuels compete with food crops and require substantial
amounts of water, nutrients and fossil fuels to cultivate the lands and remain productive from year
to year.
Cellufuel is aggressively pursuing the development of CelluFuel Inc. and the realization of a demo
and commercial scale projects in Nova Scotia within the next 6-18 months with a focus near the
areas of Liverpool (Demo) and Digby Yarmouth corridor (Commercial) initially, expanding on a
facility by facility basis as resource prove sustainable.
2B Green BioEnergy Corp plans on being Atlantic Canada's start in the renewable fuel energy
sector, by setting up and operating a $63 million biodiesel facility that will use the most efficient
and costeffective technology to produce high quality B100 biodiesel, which meets ASTM D6751
standards (EN 14214 in Europe). Their biodiesel plant will have a capacity of 150 million litres per
year at the end of the third year.
The plant will incorporate agriculture by turning arable land that is not being used into arid land to
grow grain feedstocks. Plus, the need for crop rotation, by growing canola or soy which is perfect
biodiesel feedstock, will help to balance the fertility demands of various crops to avoid excessive
depletion of soil nutrients. They also anticipate using fish waste in the production of biodiesel.
2B Green believes Atlantic Canada to be the perfect location for a biorefinery, because it has a
natural competitive advantage for the production of biodiesel.
Atlantic Canada has deep seaport facilities giving it easy and inexpensive access to
European markets and the southern US oil hub.
Feedstock such as canola is well adapted to growing conditions in Atlantic Canada and can
be introduced into rotation with potatoes which also increase the yield of the potato crop.
Rotating canola and potatoes will result in agronomic advantages such as higher yields, as
well as higher economic advantages.
Eastern Canada is the location of oil refineries which are required to purchase biodiesel.
Furthermore, they believe a biodiesel project will generate economic benefit for northern New
Brunswick in Atlantic Canada, creating 30 to 60 direct and up to 600 indirect jobs. Also:
Agricultural Sector - New Brunswick farms contain nearly 1 million acres including
approximately 370,000 acres of crop land. There is sufficient acreage of canola grown in
New Brunswick and neighbouring provinces to supply the biodiesel plant requirements.
It is expected that canola will fit very well into potato locations, offering a more
profitable alternative to cereal crops;
Fishing Industry - fish plants can sell fish waste as feedstock for the biodiesel facility;
Transportation the company will ship its products by rail, truck and sea; the project
will create enough railcar volume to indefinitely rescue the rail lines from
abandonment;
Environment - a renewable energy industry will help meet the challenges for a clean
environment;
APRI No. 200344
Oil Refineries - Atlantic Canada will have a unique potential to grow its feedstock,
produce the biodiesel and sell to major end users located in the Maritimes.
New Tax Base - Atlantic Canada can be a leader in the renewable energy industry; and,
local production and crushing of canola feedstocks is expected to create a significant
competitive advantage for the region including increased profits for farmers, new jobs
and tax revenues for governments.
Northern New Brunswick will incur increasing economic activity and will become a vital
part of the gateway.
This is another example of an Atlantic Canadian initiative that has opportunity for success, but it
must be able to move ahead to commercialization on a level playing field, with three essential
things other Canadian jurisdictions have had in the past. 1) A mandate for biofuel = demand; 2)
Assistance in capital cost, through programs like ECOABC or the equivalent; and 3) production
incentive programming like ECOEnergy.
Atlantic Canadas Bioenergy Opportunities Project Appendix G
APRI No. 200344
APPENDIX F LETTER TO FEDERAL MINISTERS
APRI No. 200344
APRI No. 200344
APPENDIX G QA / QC CAPABILITIES AND CAPACITY

Kulbir Singh, Ph.D.
(Quality Assurance
Manager)
Dr. Gerry Marangoni
(Lab Director)
Phone: 902-867-2324
E-mail: gmarango@stfx.ca
Fax: 902-867-2414
Phone: 902-867-5110
E-mail: ksingh@stfx.ca
Fax: 902-867-2414
St. F.X. University Physical Science Center

1 West Street PO Box 5000
Antigonish NS Canada B2G 2W5
A look at the current state of QA/QC capabilities and

capacity in the Atlantic region
A Report Covering Biofuel Analytical Support and Instrumentation and
Chemical Consulting for the Atlantic Biofuel Industry.
Submitted to:
Prepared by:
Per:
Ken Magnus, Atlantic Council for BioEnergy Cooperative

D. Gerrard Marangoni
X-Cell Analytical
StFX University
August, 2012
Signature
Date
APRI No. 200344
Introduction
Atlantic Canada has had a small biofuels industry since the late 1990s. A major barrier to the growth of
this industry (in this region) has been the lack of a dedicated Research and Development lab that would
allow biofuel producers and marketers ready access to quality analytical data required to ensure market
specifications are met as well as the ability to undertake research projects to allow the development and
implementation of regional technologies that may be suitable for export.
The purpose of the present document is to provide the Atlantic Council for BioEnergy Co-operative
(hereafter ACBC) the rationale behind the establishment of one or multiple regional facility(s) to support
and power the growth of biofuel related technologies in the region. From 2006 to the present, support
to the Biofuels Industry in the Atlantic region has been limited and consists of only 1 dedicated lab XCell Analytical. With the labs interest in biodiesel services, and with the principal investigators (PI)
knowledge and appreciation of the unique juxtaposition of Quality Assurance and lack of
Operational or Field Issues, X-Cell Analytical has been successful in:
1. Providing analytical and research services to a number of regional customers;
2. The implementation of a Quality System (based on the BQ9000-L standard);
3. Demonstrating a unique, fundamental understanding of the connection between quality
monitoring and quality assurance (this is a critical but often overlooked issue in the adaptation of
biofuels in transportation and domestic heating situations).
The Director of X-Cell (the author of this report) oversaw the implementation of a suite of standardized
lab procedures and developed an awareness of the strengths and limitations of administrative and
technical practices required for a successful growth of the biofuels industry. It is this experience that
forms the basis of this report.
The goals of the report are as follows:
Provide a sampling of the facilities and expertise that exist in the region.
Demonstrate the need for a Regional Biofuels Research and Analysis Centre as an economic
driver for: the establishment of a successful biofuel project supporting the biofuels industry in
the Atlantic region as it develops and grows.
A demonstration of the capacity and capabilities of X-Cell Analytical as an example of the

facilities required to support this sector and subsequent sub-sector.
Provide a snapshot of the knowledge and the expertise that has been built up by X-Cell
Analytical as a full-scale Biofuels Research and Analysis Centre, as a minimum framework to
replicate and build upon in support of a biofuel quality assurance/quality control sub-sector.
APRI No. 200344
Regional Atlantic Canada Assets The Perspective

During the decade 2000-2010, the Atlantic Region has exhibited a dichotomy between a strong regional
biofuel production base (mainly two players, SF Rendering in Canning NS and Ocean Nutrition from their
fish oil production facilities in Mulgrave, NS), and engineering and technical support being provided
chiefly by two parties (FoxCreek Consulting/Maritime Biofuels Limited and more recently, the
Biorefinery Technology Scale-Up Research Centre in Grand Falls, NB). SF Rendering (SFR) represents a
2,000,000L capacity plant that was in production from 2006-2010 that was taken off-line when its major
local industrial customer ceased operations due to the economic downturn. SFR and Wilson Fuels were
both acting upon the same initiative whereby the Domestic Fuel Supply was mandated to be 5%
renewable by 2010.
Despite the strong academic presence in the region, until very recently there existed only isolated
research initiatives from individual professors (i.e., members of the Dalhousies Canadian Institute of
Fisheries Technology); the majority of the research initiatives from institutions and other regional
scientists were geared towards maximizing the payload of highly valuable omega-3 oils from supplement
production. Essentially, a single major marketer emerged in the region (Wilson Fuels Limited), with
other smaller marketing/commercialization initiatives (through Maritime Biofuels Limited) beginning to
take shape. Recent announcements from Cape Breton Universitys Verschuren Centre for Sustainability
in Energy & the Environment (CSEE), and the New Brunswick Community Colleges Biorefinery
Technology Scale-Up Research Centre in Grand Falls New Brunswick have demonstrated the importance
of this growing sector within the region.
Additionally production of biofuels from various sources is nearing the market-ready stage (e.g., Atlantic
BioEnergy Corporation, PEI), requiring sector proponents to take a closer look at the regions capabilities
and capacity to support the growth and expansion currently underway. Despite the increased activity,
Atlantic Canada clearly trails far behind the other Canadian regions (notably Saskatchewan), the U.S.,
Brazil and other world leaders in renewable fuels production and consumption, despite the fact that we
have the potential feedstocks/waste streams to be among global leaders. The lack of a strong R&D
centre for biofuels in the region has to be considered as a significant factor in the slow pace of growth
that was seen in the renewable fuels industry during the first decade of the new millennium.
Next generation biofuels currently under development (e.g., cellulosic ethanol, biobutanol, biomass
conversion, etc.) have a significant amount of potential in the region, and will have a huge economic
impact as Atlantic Canada move away from more traditional uses of wood resources and wood waste.
However, a number of technical barriers remain that must be resolved through extensive research and
development efforts, before progress in the development and commercialization of next generation
biofuels in Atlantic Canada (and also in Canada) can be realized.
A coordinated, well-funded, and certified Regional Centre for Biofuels Production will assist the industry
in a number of ways:
1) Assist manufactures in solving production problems;
2) Working with producers to establish quality-testing protocols;
3) Short and long-term research projects dedicated to the utilization of regional feedstocks in the
production of biofuels;
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APRI No. 200344
4) An analytical lab that can support quality assurance/quality control (QA/QC) procedures in order
to ensure a regional supply of high quality, sustainable, and secure biofuel that could also
support pilot plants;
5) Assist in developing vendor operating procedures, including QA/QC regimens, in order to ensure
a regional supply of high quality, sustainable, and secure biofuel.
Atlantic Canadian Capacity

Although the Atlantic biofuels sector has existed for some time, the recent increase in research, (both
applied and fundamental) and projects involving all levels of government, academia and industry
combined with the newly implemented federal renewable fuels standards (RFS) demonstrate that the
sector is currently growing to meet regional and global demands. The capacity to support this
burgeoning sector from a QA/QC perspective has been limited with only a few key players in the field.
This shortfall in support capacity should be seen as a secondary opportunity for regional economic
development with the opportunity to employ highly qualified professionals (HQPs) graduating from our
regional academic institutions around a new sub-sector or spin-off sector of technical expertise.
Regionally, biofuels of various types have been produced since the late 1990s; only one major corporate
player has successfully implemented a quality marketing initiative with regards to biofuels. There are no
certified producers in the region, and until recently, the Atlantic Canadian biofuels sector could be
described as a collection of small biodiesel producers, each with a capacity in the thousands of litres per
year range instead of the capacity sweet spot in the hundreds of thousands to the millions of litres per
year range. The biggest reason for this capacity gap is the lack of expertise in the region required to
scale-up production operations; this gap is not simply an engineering issue, as there are a number of
firms capable of excellent plant designs. Scale-up issues arise from a complex combination of chemistry
and engineering issues, and significant expertise in both areas is required to overcome them. From a
QA/QC perspective, quality control must be an integral part of the entire production process, which
includes the storage and stabilization of the fuels in the post-production phase before fuel is delivered
to the customer. Atlantic Canada has an abundance of post-secondary education institutions, and these
institutions receive high marks for the quality of the education and training they provide. All these
institutions produce technically literate graduates possessing some knowledge that can be applied in the
biofuels sector. A significant opportunity in the region could be realized with the establishment of a
Regional Biofuel Production Initiative. This initiative would encompass members of various university
and community college institutions, and would include the establishment of a Regional Analysis Lab in
order to satisfy QA/QC requirements of biofuels, tax incentives for both producers and consumers to
embrace biofuels, and a significant education component. This initiative would be a significant catalyst
for the establishment and growth of a biofuels sector in this region. As an example of projects that
would immediately benefit from an initiative of this sort:
1) scientists and engineers in the region could undertake an analysis of various waste streams
for inclusion in biofuel production;
2) work with crop scientists to select suitable oil crops and maximize their yield; and
3) educate producers on the establishment of QA/QC procedures, and assist in production
scale-up.
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APRI No. 200344
This initiative would also mount a public awareness campaign on the substantial benefits of biofuels,
and connect with schools and regional science fairs to educate up and coming scientists and engineers
on the benefits of working in this industry. Finally, this regional initiative would explore next generation
biofuels and work with clean carbon producers already well-established in the region. The benefits of
such an initiative are enormous from significant waste stream diversion and utilization, to the
emergence of new markets for current regional resources (for example, resources currently used for the
pulp and paper industry could be re-deployed in a green growth industry).
Current Capacity
Outside of X-Cell Analytical, the regions only full service lab specializing in the measurement of the
physical properties of complex fluids, there are currently no other university labs capable of offering
these services in Atlantic Canada. However, there is capacity to leverage the academic assets we have in
this region to establish the required analytical labs and build a centre of excellence. There are also 3
government-funded labs in the country that offer some services in biofuels analysis including:
o
Alberta Innovates;
Saskatchewan: Saskatchewan Research Council (SRC)
Manitoba: Manitoba Hydro:
There are other private-sector labs in Atlantic Canada that offer services in biodiesel analysis
including:
Intertek (Dartmouth);
Maxxam Analytics (4 labs in NS).
It should be noted that in the authors experience, a number of regional university labs have claimed an
ability to undertake biodiesel analyses; however, in all cases these labs were only able to offer analyses
based on the availability of one or two pieces of equipment. The difficulty with this approach is that
this equipment was not dedicated to biofuels analysis, nor did the labs have the quality control
procedures implemented that could assure the regional industry of compliance with established
standards. There are no regional labs that can perform all required analytical tests for QA/QC. In fact,
even the 'big name' labs mentioned above send samples to other parts of their companys infrastructure
in either Canada or the US for analysis. This can result in long delays in releasing product for sale as a
regional lab capable of both quality assurance and sound chemical interpretation can provide invaluable
input on processing challenges that could result in additional production delays. Hence, these labs are
not in a position to assist their customers in interpreting the results and assisting them with quality
issues. A regional facility capable of performing quality analyses and assisting customers with short and
long term R&D projects is a must for any regional biofuels industry to grow and succeed. There is a real
opportunity here to build on the assets in the region (academic and industry) to support this rapidly
expanding sector.
APRI No. 200344
Future Capacity Requirements

Clearly, as the industry grows towards its objective of 100 million to 500 million L of fuel, additional
capacity in terms of personnel (lab technicians, scientist positions, project managers, QA managers) will
also be required. At the current regional output of 10 million to 20 million L, it is anticipated that the
technical capacity and capabilities of the X-Cell lab - with the addition of few HQP and some specific
instrumentation - will still be sufficient to ensure quality compliance and get the industry off on the right
foot. With the expected growth over the next 5-10 years it should be noted that personnel resources
required to support this sub-sector will need to increase proportionately with the increased output of
the biofuels being produced.
Facilities and Services
Given the amount of equipment required for biofuels analysis, and the authors knowledge of the
footprint of individual equipment in a biodiesel research and development lab, the author recommends
a minimum of 1500 ft2 of lab space. Approximately 60% of the bench space will be required for the
instrumentation listed below, with the remaining 40% dedicated to wet lab space, proper fume
cupboards, solvent and cold storage, and a sample retaining system (required for Quality Audits). The
lab must be set up to offer the following services to the biofuels industry in the Atlantic region, with the
target market being vehicles, home heating, and industrial heating.
a) Routine analysis (biodiesel and ethanol quality assurance);
b) Short-term applied R&D programs (quality & process issues in fuel production; field operability
issues);
c) Long-term R&D programs (process development; new products; IP related to fuel storage and
stability, biomass utilization).
The following tables outline an equipment list required to allow a biofuels research and development
lab to operate according to the minimum testing requirements currently required of the BQ-9000
certification,1 ethanol as a transportation fuel,2 biodiesel blends (home heating oil, industrial space
heating etc.)3 As it is difficult to completely ascertain future equipment needs (for example, the possible
importance of bio-butanol in the region as well as other second generation fuels), the lab operationally
needs to put aside enough revenue from its receivables to purchase new instrumentation, and to
upgrade existing instrumentation over time.
http://www.bq9000.org
http://www.astm.org
3
http://www.tpsgc-pwgsc.gc.ca/ongc-cgsb/index-eng.html
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APRI No. 200344
Table 1 - BQ-9000 Experimental Protocols, and Required Instrumentation for Biodiesel Analysis4
Property
Protocol
Instrumentation
EN 14538
ICP-MS
Metals (Calcium Magnesium,

Sodium Potassium, Phosphorus)
Flash point (closed cup)
ASTM D93
Alcohol control - Flash point
ASTM D93
Water and sediment
ASTM D2709
Pensky Martens
(Closed Cup)
Pensky Martens
(Closed Cup)
Centrifuge
Kinematic viscosity, 40C
ASTM D445
Viscometer
0.25
Sulfated ash
ASTM D874
% mass
139
Sulfur (includes req'd density)
ASTM D5453
Sulfur Analyzer
57
Copper strip corrosion
ASTM D130
7.3
Cetane number
ASTM D613
Corrosion
Apparatus
Cetane Engine
10
Cloud point
ASTM D2500
11
Carbon residue
12
Purchase Price
(k$ new only)
225
5
5
10
425
23.6
ASTM D4530
Cloud Point
Apparatus
% mass
Acid number
ASTM D664
mg KOH/g
14.6
13
Cold soak filterability

Free and Total Glycerin
Home Built
Apparatus
GC
0.45
14
ASTM Annex
A1
D 6584
15
D 1160
17
Oxidation stability
EN 14112
Distillation
Apparatus
Colorimeter
(Chart)
Rancimat
169
16
Atmospheric equivalent
temperature, 90 % recovered
Visual Appearance
18
Densimeter
(reqd for
Sulfur)
5 Place
Densimeter
ASTM D4530
4.5
22.6
0.02
45.0
27.2
Shaded columns indicates instrumentation is currently housed within X-Cell Analytical

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APRI No. 200344
Table 2 - Experimental Protocols, and Required Instrumentation for Ethanol Analysis2
Property
Protocol
Instrumentation
Purchase Price
(k$)
Total Acidity as Acetic Acid
ASTM D1613
Titration
11.2
Chloride
ASTM D7319
Ion Chromatography
24.2
pHe
ASTM D6423
pH electrode
11.2
Sulphate
ASTM D7319
Ion Chromatography
24.2
Copper
D1688
ICP-MS (See Table 1

Above)
Solvent Washed Gum Content
ASTM D381
Jet Evaporator
Sulphur
ASTM D5453
Sulfur Analyzer (See

Table 1 Above)
Aromatics/Benzene
ASTM D5501
Gas Chromatography
38.4
Methanol/Ethanol/Denaturants
ASTM D5501
Gas Chromatography
41.6
10
Water Content
ASTM D6304
Karl-Fischer
8.2
11
Density
ASTM D4052
5 place Densimeter (See

above)
12
Appearance
ASTM D4530
Colorimeter Chart
(See above)
13
Electrical conductivity
ASTM D5512
Conductivity meter
4.5
14
Phosphorus
ASTM D3231
Atomic Absorption
29.0
15
Non-Volatile Residues
ASTM D381
Jet Evaporator
(See Above)
16
C3 -C5 saturated alcohols
EN15721
Gas Chromatography
32.0
45.4
The total cost of purchasing new instrumentation to support a new lab set up is in the range of 2.0-2.5
M$, depending on supplier discounts. In the beginning stages, it may be possible to defer the some of
the larger equipment purchases and utilize an outside supplier for the provision of certain services (for
example, Cetane Numbers can be obtained in a 24-48 hour turnaround from the Alberta Innovates Fuel
Analysis lab). Given the impracticality (both in size and economics) of some of these items, a large
capital outlay to acquire these pieces may not be prudent during the labs start-up phase.
The Tables above demonstrate that X-Cell Analytical currently possesses the wet lab capabilities and has
established the required QA/QC protocols (with appropriate instrumentation) for biodiesel analyses; no
facility exists in the region that can perform the appropriate QA/QC procedures for ethanol as a biofuel,
and a significant capital outlay is required to establish a facility that can analyse ethanol as well as
additional second generation fuels.
APRI No. 200344
Quality Assurance Systems A Minimum Requirement for a Viable Industry

Biofuels have been on the radar with a number of government agencies worldwide; they have been fully
supportive of the use of bio-fuels that comply with an appropriately determined blending with
conventional fuels in order adopt some level of fuel security and sustainability, as well as the social
considerations involved with the reduction of greenhouse gases. Bioethanol and biodiesel are two fuels
that are currently available as part of an integrated and mandated solution aimed at mitigating some of
the energy supply and security risks that have been identified in recent years. The Canadian
government, through the implementation of the renewable fuel standard (RFS) for both gasoline and
diesel fuels, is endorsing the automotive use of ethanol and biodiesel blends from a fossil fuel
conservation and energy security points of view, but are also playing a role in establishing markets for
grains and other agricultural goods and waste streams that can be readily converted to liquid fuels.
However, it is imperative that the bio-based liquid fuels are of an equivalent quality standard to the
conventional fuels so as to achieve satisfactory operability and emission performance from the vehicles
that are utilizing these blends. This in turn requires total compliance with already established national
and international fuel quality standards, which will ensure consumer acceptance of these fuels for their
vehicles. This requires the establishment of a regional lab and a testing facility that is equipped and able
to help suppliers and consumers work through inevitable operability issues and growing pains. The
more quickly the industry can tackle QA/QC field issues, consumer acceptance of the fuels will grow. At
the same time, appropriate guidelines and quality-monitoring protocols need to be in place to assure
quality control in the distribution process (certified marketers) and eliminate issues from the production
of blended fuels. In the case of biodiesels, the BQ-9000L system is recognized as the Gold Standard QA
System designed for the Biodiesel industry. The BQ-9000 certification is based on the industry standard
lab protocol ISO-17025, the standard for most commercial analytical labs around the world.
Implementation of this QA system for biodiesels and ethanol is a necessary feature for any lab facility
functioning as a biofuels research and development lab.
Compliance to a recognized Quality Assurance/Quality Control System (for example, the BQ-9000L
system for biodiesel1,5) is a must for any analysis lab. For the lab to obtain the BQ-9000L Certification,
the lab will have to comply with the quality assurance requirements set forth by NBAC (National
Biodiesel Accreditation Commission), and by the National Governing Body for biodiesel and biofuel
producers and marketers in Canada (the Canadian Renewable Fuels Association). This means that the
lab will have to go through the following rigorous initial quality assurance process in order to serve the
biofuels industry. It is important to note that X-Cell Analytical has experience with implementing these
QA processes and procedures.
1. Drafting lab protocols and procedures, including, but not limited to
a.
b.
c.
d.
e.
Operating Procedures
Calibrating Procedures
Training Procedures
Internal Quality Audits
Data & Documentation
See Appendix for information regarding the Certification and Training Process.
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APRI No. 200344
2. Prepare a full BQ9000 Application for Certification (Quality Systems program for laboratory
based on ISO17025 Certification and ASTM 6751) since it has now been officially issued by
NBAC.
3. The lab must put in place a Customer Service Evaluation System (based on the Continuous
Improvement Philosophy of the 17025 Standard); this allows the lab to get constructive
feedback from customers on many aspects of its operations (e.g., customer service,
reporting, deadlines, and accuracy). These continuous evaluations of its services will
ultimately lead to a more focussed and responsive Research and Development Program for
the Atlantic Region.
Sales/Revenue - Using X-Cell Analytical as an Example

The following chart presents the biofuel revenue and expenditures for X-Cell Analytical from 2006 to
2009. This section has been included to provide an example of what a start-up labs revenues may look
like for this emerging sector. The percentage shortfall of the revenue based on the projected yearly
expenditures is included in the chart for discussion purposes. The author felt it was important to
demonstrate the disparity between the revenues and expenditures for a lab supporting this sector to
give the reader a clear picture of the timelines and support required to get this sub-sector up and
running.
350
300
92%
68%
59%
52%
38%
27%
17%
250
200
k$
Revenue
150
Expenditures
% Shortfall
100
50
0
2006
2007
2008
2009
2010
2011
2012
Year of operation
Figure 1 - Biofuel Expenditures and Revenue for X-Cell Analytical (FY 2006-2009)
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APRI No. 200344
Clearly, X-Cell Analytical would not have been able to operate without significant subsidies to its biofuel
revenues (mostly biodiesel), especially in its initial two years. Some of the shortfall was covered by XCell undertaking research projects for other companies that were not related to its core Biofuel
business, but the majority of the shortfall (mainly occurring on the salary and benefits side) was covered
through an AIF project. Expenditures averaged an increase of about 3% per year, consistent with costs
of living salary adjustments. The revenue stream increased at a much more rapid rate; the projections
shown on the chart for FY2011 and 2012 suggest that X-Cell was indeed heading for self-sufficiency. It is
also clear from the chart above that X-Cell would likely not have been able to reach financial selfsustainability solely on the basis of its biofuel revenue alone. If the level of production activity
continued at or slightly above the level that was normal in 2009 (where it is currently trending today), it
is highly probable that at least 20% of the labs expenditures would have to be covered from additional
sources (likely short term R&D projects outside of its core biofuel base). However, even a modest
increase in production capacity will be more than sufficient to make the lab self-sufficient within a five
year window. It should also be noted that like many corporations, a significant percentage of the labs
expenditures were salary and benefits.; In order to be competitive and to attract the quality of lab
personnel required to make the lab an R&D success, these would have to be augmented to ensure the
best highly qualified individuals (HQP) were hired. This is the main reasons for the higher expenditure
on wages and benefits versus what was dispersed through X-Cell in order to get a working biofuels
research and development lab started in this region.
In addition to the expenditures side, it should also be pointed out that the cost of the analysis charged
by X-Cell, while less expensive versus that charged by comparable government and private R&D labs,
was still considered to be too pricey for many of the players in the Atlantic biodiesel industry,
particularly if customers were considering BQ-9000 fuel certification. As an example, a full slate ASTM
analysis would cost in the range of $2000-$3000, and BQ-9000 certification requires multiple passes on
full slate ASTM analyses, as well as semi-annual full testing on production lots. We will return to this
topic in the Recommendations section below.
Start-Up Hurdles
In this section, we outline some of the issues that a regional lab would have to address during its initial
and ramp-up phases.
a) Markets the lab will have to carry out some market research to identify all potential
customers. This list of customers would be expected to increase as the industry grows in
the region. X-Cells current market consists chiefly of biodiesel analysis (~80% of revenues).
With the activity in the region increasingly centred on ethanol production, it is likely that
ethanol analysis will make up close to 60% of the labs business. There are no regional labs,
including X-Cell Analytical, currently capable of undertaking ethanol analysis (and biobutanol analysis, as this next generation biofuel becomes important). Clearly a significant
investment on the analytical and development infrastructure for ethanol is required in this
region for the industry to thrive.
b) Revenues - In order to guarantee that the lab reaches self-sufficiency, the lab should
endeavour to establish linkages with other industries in order to cultivate relevant research
and development relationships. Some other potential market include:
a. Oil Analysis;
b. Pharmaceuticals;
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APRI No. 200344
c. Mining;
d. Food Science;
e. Waste Water Treatment
Most of the potential customers will be small size companies that do not have an internal lab or
medium size companies that would be interested in a particular piece of equipment or a particular
suite of analyses. These analyses can also generate additional revenue to help alleviate any shortfall
that may initially exist. Fortunately, much of the work in these industries uses many of the same
instrumentations and operating protocols as those used in the biofuel industry. Since the biodiesel
market in Canada is still modest, and as such, extremely sensitive to environmental legislation
passed by provincial governments (6 provinces have already imposed a minimum quantity of
biodiesel in the fuel with Tax Credits available for marketers and producers). A strategy will have to
be designed to approach a large number of potential regional customers (a marketing firm or
business students could be hired to help with this).
c) Marketing Customized and strategic marketing targeted at the biofuels industry first and
then additional biotech clients second. In the case of X-Cell Analytical, the Atlantic Biodiesel
network was the main source of customers. The lab continues to network with stakeholders
by attending well targeted events (based on Markets identified).
d) Quality Assurance and Compliance the lab must become & maintain BQ9000L
Certification and implement a similar suite of protocols for fuel ethanol! Being certified is
mandatory in order to do biodiesel analysis, and there will be significant audit costs
associated with this stage (~$6,000 every 3 years).
e) Highly Qualified Professionals (HQPs) - The lab will require a Quality Assurance Manager
whose primary responsibility will be to develop, maintain, and service the QA system. It is
important to note that splitting roles in a QA lab is not recommended and will likely result in
protocols and procedures being comprised thus adversely affecting the reputation of the
lab to delivery on its requirements. For example: the lab Director cannot be the QA
Manager; these 2 functions must be independent! In addition, hiring a sufficient number
technically literate staff able to maintain state-of-the art equipment is essential to the
productivity and reputation of the lab.
f)
IP and Service Contracts - Most customers or potential customers will be small companies
that are not comfortable with service contracts; they do not have the financial resources to
be seeking legal advice for contract negotiation.
g) Certificates of Analysis - Certificates of Analysis are required to be delivered to Biofuel

customers as per QA/QC requirements. For example, every biodiesel customer requires a
BQ9000 C of A for each set of analysis; fuel ethanol customers will require the same. These
C of As are legal documents that certify the biofuel sample meets a defined quality
standard.
h) Safety and Environmental Issues any ISO17025 lab must have a system in place for
sample tracking and retains. BQ-9000L requires sample retains for 3 months and then
discard them. Biofuels is environmentally friendly and samples are discarded as per
standard practice. A system (and infrastructure) for sample retains and disposal has to be
implemented.
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APRI No. 200344
i)
Equipment Issues the lab must be prepared to deal with equipment failures since
maintaining deadlines is key to success with private sector; any certified lab must have a
preventative maintenance system (with appropriate documentation). Also, the lab needs to
be able to afford repairs and parts as well as replace equipment when necessary (without
interruption of services if possible); the budget presented above includes a Contingency
Fund to help deal with this matter.
j)
Certification - A Certified lab requires the lab to implement a Training Program and all its
training procedures be documented (as well as Operation, Calibration, Training,
Administration, QA procedures).
X-Cell Analytical A Biodiesel Facility

The following pages outline the operational capacity of X-Cell Analytical in its mission to service the
biofuels industry in the Atlantic region, and its initial attempts to work towards the rigorous quality
assurance protocols in support of the biofuels industry in the region. The following operational
description can also be used as a template to grow the capabilities and capacity in the region with
regards to growing a sub-sector specifically aimed at supporting the biofuels industry.
Personnel and Expertise

X-Cell Analytical was headed by a Professor (Consultant) + 1 backfill position (for teaching relief) with 4
full time employees. Our experience has demonstrated that our lab was able to function as an R&D lab
in addition to providing quality analytical Services to an industry with an average output of 3 000 000 to
6 000 000 L of fuel with six full-time employees. The technical roles of the employees as well as how
they connect with any internationally recognized Quality Assurance program is described in some detail
below;
1. Director (Professor) the role of the Director is to oversee the operation of the lab and to
ensure that scientific rigor is a significant part of the day-to-day operation of the lab. The
Director is the final reporting voice when data is communicated to the outside customer.
The Director plays a significant role in all aspects of lab operations, including training,
Quality Management, and scientific accountability. Ideally, the director should possess a
PhD in Chemistry and must have the ability to interact with Chemical Engineers.
2. Quality Assurance Manager/Project Manager the project manager/QA Manager (the
Manager) serves a dual role within the lab. This individual oversees both the day to day
financial side of the labs operation as well as function as the Quality Assurance manager in
ensuring compliance with external lab certifications. The Manager in conjunction with the
Director is responsible for the publication and maintenance of Standard Operating
Procedures (SOPs), Standard Administrative Procedures (SAPs), and Standard Calibration
Procedures (SCPs). With the director and the lab staff, the QA manager is responsible for
identifying and addressing issues identified during both internal and external quality audits.
The QA Manager ideally possesses a MSc. Degree and an MBA, and has experience in the
set-up and implementation of Quality Assurance initiatives.
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APRI No. 200344
3. Lab Technician x 2 the lab technicians are responsible for the day to day operational and
research functions in the lab. The technicians serve a vital role in identifying and
establishing new and improved quality procedures and parameters, implementation of new
research protocols, and the initiation and testing of new equipment. The technicians should
have a minimum of a two year chemical technology diploma and experience working in a
Quality Assurance environment.
4. Research Scientist the role of the research scientist is to carry out research projects that
are beyond those identified as routine analysis. These include, but are not limited to, shortterm R&D projects for external customers, research and development of new testing
procedures and protocols, and the development of intellectual property related to fuel
production, fuel processing, and fuel stabilization. Ideally, the scientist possesses a PhD in
Chemistry and has the ability to interact with commercial partners.
5. Maintenance Technician this is a critical position to maintain Good Lab Practices (GLPs)
and operation excellence. The Maintenance Technician would have a minimum of a two
year chemical technology diploma and experience working in a Quality Assurance
environment.
It should be noted that X-Cells staff were all graduates of Atlantic Canadian Institutions, and in fact
were almost completely educated in this region. As the industry grows, and is able to employ more and
more graduates from our colleges and universities, this will have a significant benefit to the entire
region as much desired intellectual capacity will choose to stay here and be part of a green and growing
industry. These graduates will establish new technologies and processes, creating jobs and growing the
industrys knowledge base!
Operating Budget
The following table is a projected budget over a standard fiscal year including the director.
Table 3 - Projected Yearly Operating Expenditures6 for Biodiesel Analytical Lab
Activity Description
Wages & Benefits
Annual Amount
$370,000
Equipment
Parts & Supplies
Travel
Miscellaneous
$40,000
$50,000
$15,000
$10,000
TOTAL
$485,000
Description
Based on Personnel described above (including
Backfill, including Director)
Contingency Fund
Consumables and instrumental wear parts
Conferences, business meetings
Laboratory Audits, Marketing, Round Robin
Analytical Testing Registration, ASTM and other
Standards Subscriptions
Depending on where the Analysis lab is housed, the Directors salary can be significantly offset from
other funding streams.
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APRI No. 200344
Recommendations
The following list of recommendations is based on the authors experience with X-Cell Analytical and the
current and projected future state of an Atlantic Canadian biofuels industry. Note that some of these
recommendations apply to a biofuels lab being housed within a university setting (like X-Cell Analytical).
a) The Establishment of a Regional Biofuel Production Initiative This initiative would
see stakeholders from universities, colleges, industry and government come
together to confirm the needs and requirements of a supporting sub-sector.
b) The Establishment of a QA/QC Environment - Establish and maintain a Quality
Assurance controlled environment (like BQ9000-L) which will be attractive to the
regional industry and will improve the quality of the goods and services being
offered by the Atlantic biofuels industry including:
a. A high quality research environment that can provide service as well as short to
medium terms R&D capabilities that will allow members of the regional industry to
provide new goods and services and allow the development of IP within the broader
Atlantic biofuels industry;
b. A training centre to train lab personnel and producers and marketers in a Quality
Control System (e.g., BQ9000));
c. Lab or labs in a university setting in order to maximize the availability of more
government programs for revenue assistance in the start-up phase, insurance
benefits, infrastructure benefits, and the access to scientific and technical
information;
It is anticipated that these recommendations could be met by cataloguing and
leveraging the strong academic assets that would both contribute to and benefit from
the sub-sector.
c) Inter-Provincial Buy-In and Investment - Lobby the Atlantic Premiers to establish
tax credits or subsidies to increase the potential for entrepreneurs and investors to
get involved with the industry, and provide potential opportunities for industry
players to access high quality analytical and service work. This will aid in both
economic development, increase the likelihood of survival for the agricultural
industry in the region, and create and maintain jobs in the Atlantic Provinces both in
the fuels and agricultural production.
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APRI No. 200344
Next Steps and Closure

The author believes that the next logical step to this analysis is to complete a business assessment of
this sub-sector to identify:
1. the monetary commitments required to establish this sub-sector;
2. the programs available to support the recommendations made above; and
3. the timeline required to support those recommendations.
It is understood by both parties that all reasonable attempts have been made by D. Gerrard Marangoni
to deliver the above work product to ACBC. The suggestions presented in this document provide a
reasonable assessment of the work undertaken in the analysis of the current state of the biofuels
industry in the Atlantic region with regards to a Full-Slate analysis and certification lab. The goal of this
document was to provide available facts, identify current issues, and provide a means to facilitate and
stimulate discussion of what a comprehensive research and development lab dedicated to the Atlantic
biofuels industry might look like
16
Atlantic Canadas Bioenergy Opportunities Project Appendix H
APRI No. 200344
APPENDIX H PROVINCIAL / TERRITORY CONTACTS

Province/Territory
Contact
British Columbia
Michael Rensing, Manager Renewable Fuels

Department: Energy, Mines and Petroleum Resources
205 952 0265 michael.rensing@gov.bc.ca
Susan Carilisle, Manager, Alternative and Renewable Energy.
Department of Energy
780 415 1283 susan.carlisle@gov.ab.ca
Ron Kehrig, Sector Manager, Biofuels and Bio-Products
Department: Enterprise Saskatchewan Resource and Manufacturing
306 933 7244 ron.kehrig@enterprisesask.ca
Jeff Kraynk, Manager
Department: Agriculture, Food and Rural Initiatives
204 945 5222 jeff.kraynk@gov.mb.ca
Alberta
Saskatchewan
Manitoba
Ontario
Quebec
New Brunswick
Nova Scotia
Newfoundland
Yukon
Northwest Territories
Nunavut
Bob Brennand, Business Development and Project Manager

Department: Manitoba Innovation, Energy and Mines
204 945 7392 bbrennand@gov.mb.ca
Bill Greenizan, Advisor, Energy Markets
Department: Energy
416 326 0548 Bill.Greenizan@ontario.ca
Tammy Tondevold, Sr. Policy Advisor
Department: Agriculture, Food and Rural Affairs
519 826 3875 tammy.tondevold@ontario.ca
Raynald Archambault, Advisor Emeritus, Downstream Sector
Department: Natural Resources
418 627 6385 raynald.Archambault@mmf.gouv.gc.ca
Keith Melvin, Business Development Officer
Department: Energy
506 658 2172 Keith.Melvin@gnb.ca
Nancy Rondeaux, Manager, Electricity and Renewable Energy Division
Department: Energy
902 424 4458 rondeana@gov.ns.ca
John Hughes, Director, Special Projects
Department: Environment, Energy and Forestry
902 368 5884 jshughes@gov.pe.ca
Corey Snook, Policy Program and Development Specialist
Department: Natural Resources
709 729 3131 CoreySnook@gov.nl.ca
Robert Collins, Energy Resources Analyst
Department: Energy, Mines and Resources
867 667 5015 bob.collins@gov.yk.ca
Dave Nightingale, Director, Energy Planning
Department: Industry, Tourism and Investment
867 920 3274 Dave_Nightingale@gov.nt.ca
Roy Green, Director Community Infrastructure
Department: Community and Government Services
867 975 5441 rgreen@gov.nu.ca
Atlantic Canadas Bioenergy Opportunities Project Appendix I
APRI No. 200344
APPENDIX I ATLANTIC CANADA

BIOFUELS FEASIBILITY MODEL
Bio-fuels production facility

business case model
Submitted to:
BioAtlantech New Brunswick
Submitted by:
Gardner Pinfold Consultants Inc.
January 15, 2013
APRI No. 200344
Table of Contents
Page
Atlantic Biofuels Feasibility Model ......................................................................... 1
1. Notice and disclaimer .................................................................................. 1
2. Overview ..................................................................................................... 1
3. Model information sources .......................................................................... 2
4. Guide to Model inputs ................................................................................. 3
5. Guide to Model outputs ............................................................................... 7
6. Concluding note .......................................................................................... 8
Appendix: Results Tables ..................................................................................... 9
Sources............................................................................................................... 11
Gardner Pinfold
APRI No. 200344
Atlantic Biofuels Feasibility Model

1.
Notice and disclaimer
The Atlantic Biofuels Feasibility Model (hereafter the Model) is intended to provide
proponents and lending agencies with a tool to facilitate analysis of prospective ethanol
and biodiesel biofuels projects. The Model as constructed incorporates indicative capital
and operating cost data, as well as revenue streams for projects using different
feedstocks. It is not intended to provide financial advice or to be used as the basis for
specific investment decisions. Specialist advice should be obtained regarding each
project-specific investment.
The Model was developed by Gardner Pinfold Consultants Inc., in conjunction with the
Atlantic Council for Bioenergy Cooperative (ACBC), under contract to BioAtlantech New
Brunswick with funding from the Atlantic Canada Opportunities Agency.
While every effort has been made to provide reliable and accurate information in the
Model based on data currently available, Gardner Pinfold Consultants Inc. does not
warrant the accuracy, currency, nor completeness of the Model or any information
contained in the Model.
Anyone using the Model does so at his or her own risk and no responsibility is accepted
by the consultant or sponsoring organizations ACBC or BioAtlantech for any losses
which might directly or indirectly result from any reliance on or use of the Model.
2.
Overview
The model is designed to help assess the financial viability of biofuels production options
in Atlantic Canada. In particular, the model helps to assess the importance of the
following key plant design and operation considerations:
1) Feedstock types and their relevant attributes for biofuels production (e.g. costs,
delivered freight charges, conversion efficiency etc.).
2) Plant scale in terms of biofuel production capacity including efficiency over the life
of the plant.
3) Pre-construction and construction costs including capital, pre-operating,
contingency funds, and working capital needed until revenues begin.
4) Financing options from banks, different levels of government, other sources, and
private equity (including interest rates and amortization periods).
5) Operating costs including a wide range of inputs such as the number of
employees, salaries, benefits, and administration costs.
6) Revenues from the biofuel product as well as by-products including animal feed,
heat and power.
APRI No. 200344
A suite of production results and financial indicators are calculated for assessment of
potential biofuel plant performance. The Model contains input and output sheets for six
plants so these can be evaluated simultaneously on a comparison sheet. Results for the
six plants are summarized on a final comparison sheet (Table 1) to evaluate, for
instance, the performance of plants with different feedstocks or plants at different scales.
Table 1: Model results comparison sheet (example only)

Plant Profiles
Plant 1
Product
Feedstock
Plant capacity (litres)
Financing
Required funds
% Equity
Feedstock
Crop yield per acre
Crop delivered cost per ton
Revenues
Revenue per litre of product
Other revenue per litre of product
Total revenue per litre of product
Plant 2
Plant 3
Plant 4
Plant 5
Plant 6
Ethanol (corn)
38,000,000
Ethanol (wheat}
38,000,000
Ethanol (cellulose)
25,000,000
Biodiesel (canola)
10,000,000
Ethanol (sugar beets)

25,000,000
Biodiesel (soybeans)
10,000,000
47,678,147
37%
56,952,164
37%
39,926,709
60%
25,931,068
61%
27,815,818
28%
15,001,068
33%
1.75
254
0.98
304
1.40
131
0.75
660
35.00
50
0.90
508
$0.63
$0.33
$0.96
0.63
0.33
0.96
0.67
0.1
0.77
1
1
2
0.67
0.34
1.01
1
1
2
Key Results
Plant 1
Plant 2
Plant 3
Plant 4
Plant 5
Plant 6
Local economic benefits

Crop tonnes
Crop acres
Farm income
Transport income
95,000
54,286
$23,750,000
$1,330,000
102,703
104,799
$0
$1,360,811
78,125
55,804
$0
$1,093,750
21,505
28,674
$0
$465,054
250,000
7,143
$0
$1,250,000
50,000
55,556
$0
$650,000
Plant financials
Payback period
IRR
Year 5 net cash flow
Year 5 debt:equity
Year 5 profit margin
12
5%
$4,857,499
65%
13%
At least 20 years
Negative
($2,669,620)
66%
-7%
13
4%
$3,409,567
26%
18%
11
7%
$2,722,728
24%
14%
5
21%
$7,506,742
78%
30%
At least 20 years
Negative
($8,393,323)
76%
-42%
Disclaimer: This Model is intended to provide general guidance and a tool for analysis only and is not intended to provide financial advice or to be used as the basis for investment decisions.
3.
Model information sources
The Model construction relies on 1) a general approach to financial feasibility analysis,

and 2) specific information for biofuels production.
The general approach to financial feasibility analysis is the same as for most project
developments involving construction of a system that will process inputs and produce
outputs on an annual basis over time. Costs and revenues are calculated annually over
a twenty-year period and summarized according to key production and financial
indicators that would be of interest to investors. The financial analysis is based on
generally accepted management accounting principles and Gardner Pinfold Consultants
Inc. experience with construction and review of similar models for a wide range of
projects.
The specific information for production of biofuels from a selection of different feedstocks
is largely based on published reports for commercial facilities in Canada and the U.S.
(see Sources). In some instances there is only information for plants at certain scales,
while in a few cases there is sufficient information to assess a wide range of scales (e.g.
corn, wheat, barley). Information for assessment of plants using forest biomass
(cellulose) as feedstock was available from demonstration and research facilities only,
and consequently, the indicative results shown in the Appendix should be considered
highly speculative.
4.
APRI No. 200344
Guide to Model inputs
The inputs sheets have shaded cells for Model Users to make selections and enter
information. All other boxed or non-shaded cells should not be manipulated as these
contain fixed values and formulas required for the Model to function properly. The six
input sheets are the same and contain each of the following main section headings that
are described in turn below:
7) Feedstock
8) Plant capacity
9) Construction and pre-operating
10) Financing
11) Maintenance and depreciation
12) Feedstock constants
13) Operating
14) Revenues
4.1
Feedstock
Just before selecting the feedstock, the Model user must indicate whether or not preset
data will be used where available.
If yes then data from published sources respecting commercial plant operations in
Canada and the U.S. will be used. In particular, this will draw upon capital and preoperating costs, as well as the number of employees and applicable salaries. It should
be noted that even with the use of pre-set data the Model User must also specify many
input values (e.g., feedstock prices, feedstock processing and conversion constants,
finished product prices).
If no then the Model user must enter all data regarding the potential plant. It is
important for Model users to be familiar with reasonable input values for biofuels plants
in both cases (pre-set and user-determined), but especially so when user-determined
data are being used.
There are seven feedstock options including:
15) Corn
16) Wheat
17) Barley
18) Cellulose (e.g. wood, straw)
19) Canola
20) Sugar beets / other
21) Soybean
The sugar beet (or other) option requires custom data entry throughout therefore it can
be used for any other feedstock of interest in the future.
4.2
APRI No. 200344
Plant capacity
Selecting the plant capacity (litres of production) has a bearing on preset data for the
canola and soybean options. There are 6 plant scales with preset data available for
canola, and three for soybeans (capacities shown to the right side of sheet). The exact
plant scale must be entered in the shaded capacity cell to trigger the use of preset data
in each case. Please note entering a scale that differs even by one litre from these
capacities will require custom data entry for the remainder of the sheet.
Any capacity can be entered for corn, barley, cellulose, and canola to access preset
data, but for sugar beets/other the Model user must enter data throughout.
Some plants may be expected to experience declines in productivity over time, or the
Model user may wish to examine the effect of production issues that prevent the plant
from operating at full capacity. The shaded production % of capacity is where this can be
determined.
4.3
Construction and pre-operating
Before the plant begins operations there will be a period of planning, design, project
development and construction. This period can be set up to 24 months, and the
associated costs may be entered into the Model. The construction costs, contingency
funds, and applicable taxes can also be entered.
It is most important to verify that reasonable costs are entered according to the
feedstock, plant scale, and the plant location (e.g. applicable taxes by province). Note
that pre-operating costs and contingency funds are entered on an annual basis, and the
Model will convert the annual amounts to the amount for the pre-construction period that
is set in months (e.g. 24 month period means double the annual amount will be spent in
total).
4.4
Financing
There are commonly multiple financing sources for a biofuel plant and the Model allows
for the specifics of each source to be entered. The first cell (not shaded) in the section
indicates the total funds that must be raised to move the project forward (e.g. including
working capital up to the first revenues from production).
Three of the five shaded cells for data entry are labeled bank loan, federal loan, and
provincial loan, however these can represent any source of funding. The only
constraint is that the maximum amortization period accommodated by the model is 20
years (240 months). After loans are entered, the balance is calculated as equity in the
un-shaded cell below.
Dividends to shareholders may be set as a percentage of cash flows in this section also.
4.5
Maintenance and depreciation
The cost of maintenance and upgrades and the rate of depreciation over the life of the
project are entered as percentages. These are applied to the total combined capital
APRI No. 200344
construction costs, contingency funds and taxes.

The plant life expectancy is entered in years, and this determines the period over which
all costs (including operations) are calculated. Keep in mind the plant life should not be
shorter than the loan amortization periods for a sensible analysis.
4.6
Feedstock constants
The Model requires a series of data inputs according to each of the feedstocks as
follows with brief descriptions for each one:
22) Farm yield (t/ha) this determines the calculated acreage of feedstock required to
run the plant at capacity.It is based on Maritime 5-year averages where available,
Western Canada 5-year averages for canola, PEI 2012 production for sugar beets,
and industry sources for wood cellulose.
23) Price ($/t) - this is the farm-gate price required by growers to induce them to supply
the plant with the selected feedstock. Market prices may be entered as long as this
basic assumption is satisfied. Actual prices will be the subject of contract
negotiations with growers and will consider numerous factors. An appreciation of
long-term price fluctuations and key price drivers should be maintained in selecting
appropriate values.
24) Freight-in ($/t) this is the average cost to bring feedstock from producers to the
plant.
25) Yield (litres/t) of Ethanol or Biodiesel this is a conversion constant that must
bear in mind the feedstock properties that are assumed at the price entered (e.g.
moisture content, crushed or otherwise processed in any way).
26) DDG (%) based on the assumed feedstock properties at the price entered.
27) Enzyme cost ($/l) expressed per litre of ethanol biodiesel produced.
28) Yeast ($/l) expressed per litre of ethanol biodiesel produced.
29) Chemicals ($/l) expressed per litre of ethanol biodiesel produced.
30) Denaturant ($/l) expressed per litre of ethanol biodiesel produced.
31) Water ($/l) expressed per litre of ethanol biodiesel produced.
32) Waste ($/l) expressed per litre of ethanol biodiesel produced.
33) Natural gas ($/l) expressed per litre of ethanol biodiesel produced.
34) Electricity ($/l) this may be entered as a net value (e.g. zero) if electricity or
power is produced at the plant to avoid energy costs.
This section requires considerable expertise to determine appropriate values with careful
regard for the association between values entered. Table 2 shows the baseline
feedstock constants entered in the model; deviation from these should only be
undertaken with sufficient research and consultation with industry experts.
APRI No. 200344
Table 2: Biofuels model constants

Farm yield (t/ha)
Price ($/t)
Freight-in ($/t)
Yield (litres/t)
DDG (%)
Enzyme cost ($/l)
Yeast ($/l)
Chemicals ($/l)
Denaturant ($/l)
Water ($/l)
Waste ($/l)
Natural gas ($/l)
Electricity ($/l)
Corn
Wheat
Barley
Cellulose
Canola
Sugar Beet
Soybean
6.5
$250
4-5
400
32%
0.017
0.004
0.010
0.008
0.002
0.002
0.002
0.003
2.5
$300
4-5
370
38%
0.020
0.004
0.010
0.008
0.002
0.002
0.002
0.003
2.8
$210
4-5
325
45%
0.025
0.004
0.010
0.008
0.002
0.002
0.002
0.003
3.5
$150
4-5
320
0%
0.000
0.004
0.010
0.008
0.002
0.002
0.002
0.003
1.9
$650
4-5
465
62%
0.030
0.000
0.020
0.000
0.002
0.002
0.010
0.020
87.5
$50
4-5
100
0%
0.000
0.004
0.010
0.008
0.002
0.000
0.000
0.020
2.3
$400
4-5
200
70%
0.030
0.000
0.020
0.000
0.002
0.002
0.010
0.020
4.7
Operating
The operating inputs section gathers the feedstock constants and incorporates them into
the annual costs of production. The only additional data entry for Model users is for final
product freight, labour, administration, and selling costs. Freight cost is entered on a per
litre of final product basis. The number of employees should reflect the plant type and
capacity.
Salaries are entered in dollars per year and benefits as a percentage of salaries. These
may be entered at a reduced rate to examine the potential benefit of salary rebates
sometimes available from provincial governments. The model does not allow for a
declining salary rebate over time, or a short duration rebate. The salary entered will be
applied over the life of the plant (or the twenty year period of analysis whichever is
shorter).
Administration costs are entered in dollars per year and should reflect the scale of
operations. Selling expenses are finally entered as a percentage of sales.
4.8
Revenues
Multiple revenue streams are possible and there are five shaded cells available for
Model users to enter values. The first is treated as the main plant revenue (biodiesel or
ethanol), and the remaining four are considered by-product revenue streams. All are
expressed as $/litre of plant product (biodiesel or ethanol). Other future returns may
arise in the form of carbon credits but this is not included explicitly in the model.
Most importantly, an appreciation of long-term price fluctuations and key price drivers
should be maintained in selecting appropriate values to calculate plant revenues.
5.
APRI No. 200344
Guide to Model outputs
The six individual output sheets are described first and then the comparison sheet (as
shown in Table 1) is discussed below.
The individual outputs sheets contain the following main section headings, and brief
descriptions are provided here:
35) Overview indicates the feedstock selected, required feedstock inputs and
acreage of production (not including land for crop rotation and fallow), local income
benefits to farmers (farm gate revenue not profits) and transport companies (again
revenues not profits), plant payback period, and internal rate of return.
36) Cash flows Annual cash flows for the twenty-year period are summarized.
37) Balance Annual balance sheet summaries for the twenty-year period are
presented.
38) Financial ratios a suite of annual indicators is reported including: liquid ratio,
sales to working capital, debt to equity, return on assets, profit margin, return on
equity, and sales to total assets ratio.
Given the complexity of enterprise tax structures for different scales and jurisdictions the
analysis does not attempt to incorporate tax requirements. The results should be
sufficient to determine the relative feasibility of potential plants and the financial
performance characterizing plants over time.
The Compare sheet presents a profile of inputs for each of the six plants being
analyzed at the same time and the key results for each plant profile. This provides for
side-by-side comparisons to make sure inputs are consistent where needed and the
differences in plant performance address the key questions being asked by the Model
user.
Primarily this is useful for assessing different feedstocks at similar plant scales, or for
assessing the same feedstock at different scales. However there are many other
possibilities, in fact any variable could be set to different levels with all other settings
remaining the same in order to examine the sensitivity of overall performance to key
input variables (e.g. feedstock price, interest rates, % equity, revenue prices, capital
costs etc).
Another key question the Model can help address is what will be needed to make a plant
financially viable in order to secure a bank loan or the interest of private investors. For
instance a potential plant may initially appear to have an 8-year payback period,
however some combination of low-interest loans, capital cost assistance, feedstock
subsidies, and salary rebates can be examined to determine what will bring the payback
period down to 5 years.
The Model produces the results presented in the Appendix tables. A set of baseline
plant profiles (Table A1) focuses on a plant scale that would be relevant in Atlantic
Canada with a moderate mandate for biofuels production (25 million litres).
The plant characteristics are all the same except for the feedstock type, which triggers
different capital and operating costs. Although the Model can also assess wheat
APRI No. 200344
feedstock, it is very similar and slightly inferior to barley plant financial performance. It is
also important to note that the cellulosic (wood) plant settings are theoretical as there
are no commercial plants in operation. The corn plant is also considered theoretical
because this plant scale is below the scale of plants built within the past decade. The
baseline analysis suggests a sugarbeet plant offers a viable opportunity, with canola and
corn also showing encouraging results. Results for the other plants show lengthy
payback periods, indicating they are less attractive based on assumptions used.
The Model also produces the results shown in Table A2 where baseline plant
performance is adjusted according to key variables including:
39) plant capacity (38 ML and 76ML) the payback period declines as plant size
increases. This is especially true for corn ethanol plants and the most recently
constructed plants are upwards of 200ML owing to these economies of scale,
40) feedstock prices (20% lower or higher) are one of the two most significant
drivers of plant viability (along with biofuel product prices). A 20% change in prices
can alter the payback period by multiple years for all feedstock types.
41) revenues (20% lower or higher) can cause the payback period to change by 312 years depending on the feedstock and direction of change (lower or higher
prices).
42) capital cost (20% lower or higher) has at least a 1 year effect on payback
period in either positive or negative directions, and this can be up to a three year
difference in the case of corn ethanol plants. Although this is not as influential as
the feedstock or finish product prices, the significance here is the potential positive
effects of technology improvements and capital subsidies as well as the potential
negative effects of cost overruns (although contingency funds are included in the
model).
In general the payback period moves in the direction one would expect, and for key
variables this is a prime consideration.
6.
Concluding note
The results shown in Tables A1 and A2 should be considered indicative only. Obtaining
definitive results would depend on users populating the model with cost and revenue
data specific to particular plant design, scale and location.
APRI No. 200344
Appendix: Results Tables

Table A1: Baseline plant profiles for each feedstock
Product
Feedstock
Capacity (Ml)
Plant 1*
Ethanol
Corn
25.0
Plant 2
Ethanol
Barley
25.0
Plant 3*
Ethanol
Cellulose
25.0
Plant 4
Ethanol
Beets
25.0
Plant 5
Biodiesel
Canola
25.0
Plant 6
Biodiesel
Soybeans
25.0
Financing
Required funds ($M)
% Equity
$35.2
30%
$59.4
30%
$68.3
30%
$27.8
30%
$42.2
30%
$37.0
30%
Feedstock
Crop yield (t/ha)
Conversion (l/t)
Delivered cost ($/t)
4.4
400
$254
2.8
325
$214
3.5
300
$156
87.5
100
$54
1.9
465
$624
2.3
200
$404
Revenues
Biofuel ($/l)
Other ($/l)
Total ($/l)
$0.67
$0.34
$1.01
$0.67
$0.34
$1.01
$0.67
$0.34
$1.01
$0.67
$0.34
$1.01
$1.00
$1.00
$2.00
$1.00
$1.00
$2.00
Plant 1*
Plant 2
Plant 3*
Plant 4
Plant 5
Plant 6
62,500
9,615
$1.5
$15.6
$1.5
76,923
28,045
$1.5
$16.2
$1.6
83,333
24,088
$1.2
$12.5
$1.8
250,000
2,891
$1.0
$12.5
$2.3
53,763
29,010
$0.7
$33.3
$1.5
125,000
56,206
$0.5
$50.0
$1.8
15
4%
$3.4
70%
13%
>20
-7%
$1.7
80%
7%
16
3%
$5.7
80%
23%
5
18%
$6.4
66%
25%
6
16%
$9.1
73%
18%
>20
Negative
($7.6)
71%
-15%
Key Results
Local benefits
Crop tonnes
Crop hectares
Plant workers ($M)
Farms ($M)
Transport ($M)
Plant financials
Payback period (yrs)
IRR
Yr 5 net $ flow
Yr 5 debt:equity
Yr 5 profit margin
Disclaimer: This Model is intended to provide general guidance and a tool for analysis only and is not intended to provide
financial advice or to be used as the basis for investment decisions.
*Note: Commercial scale corn ethanol plants being built today are much larger than 25ML; Ethanol from wood cellulose
has not been produced commercially, consequently model results are only theoretical for this feedstock.
APRI No. 200344
Table A2: Effect of key variables on payback period (years) relative to baseline
plants (as in Table A1)
Biofuel
Feedstock
Baseline 25ML
Larger plants
38ML
76ML
Feedstock prices
20% lower
20% higher
Revenues
20% lower
20% higher
Capital cost
20% lower
20% higher
Plant 1
Ethanol
Corn
15*
Plant 2
Ethanol
Barley
20
Plant 3
Ethanol
Cellulose
16*
Plant 4
Ethanol
Beet/Other
5
Plant 5
Biodiesel
Canola
6
Plant 6
Biodiesel
Soybeans
20+
10
8
20+
19
11*
9*
5*
4*
6
4
20+
20+*
6*
20+*
16
20+
10*
20+*
4
8
3
20+
19
20+
20+*
5*
20+
12
20+*
8*
20+
3
20+
2
20+
20+
12*
18*
20+
20+
12*
18*
5
7
5
7
20+
20+
Disclaimer: This Model is intended to provide general guidance and a tool for analysis only and is not intended to provide
financial advice or to be used as the basis for investment decisions.
*Theoretical plant design
10
APRI No. 200344
Sources
Agricorp Ontario. 2012. Fair market values: 2011 Agristability
Alberta Government. 2011. Agriprofits: The economics of sugar beet production in Alberta
Argus Media. 2012. U.S. Ethanol and Biodiesel Market prices and Analysis: Issue 12-166
BBI Biofuels Canada. 2006. Economic impact study for canola-based biodiesel industry in
Canada: Report for Canola Council of Canada
BBI Biofuels Canada. 2006. Feasibility study for a biodiesel plant in the Regional Municipality of
Durham
Doyletech Corporation. 2010. Total economic impact assessment of biofuels plants in Canada:
Report for Canadian Renewable Fuels Association
Prince Edward Island AgriAlliance. 2012. Cost of crop production
Statistics Canada. 2012. Cansim Table 001-0017 - Estimated areas, yield, production, average
farm price and total farm value of principal field crops, in imperial units, annual
11
Atlantic Canadas Bioenergy Opportunities Project Appendix J
APPENDIX J ATLANTIC CANADA

BIOFUELS FEASIBILITY MODEL
Economic Impact of a
Maritime Provinces
Biofuels Industry
Submitted to
BioAtlantech New Brunswick
Submitted by
Gardner Pinfold Consultants Inc
March 2013
Gardner Pinfold
APRI No. 200344
APRI No. 200344
Table of Contents
Page
Summary.............................................................................Error! Bookmark not defined.
1.
2.
3.
Introduction..................................................................Error! Bookmark not defined.

1.1
Objectives ................................................. Error! Bookmark not defined.
1.2
Outline ...................................................... Error! Bookmark not defined.
Methodology ................................................................Error! Bookmark not defined.

2.1
Selecting options for impact assessment .. Error! Bookmark not defined.
2.2
Key industry assumptions ......................... Error! Bookmark not defined.
2.3
Estimating impacts .................................... Error! Bookmark not defined.
Economic impact results ............................................Error! Bookmark not defined.

3.1
Plant construction...................................... Error! Bookmark not defined.
3.2
Plant operations ........................................ Error! Bookmark not defined.
List of Tables
Table S-1: Biofuel plant construction impacts .................Error! Bookmark not defined.
Table S-2: Biofuel industry annual economic impact estimates .. Error! Bookmark not
defined.
Table 1: Maritime Provinces land requirements for renewable fuel production Error!
Bookmark not defined.
Table 2: Plant characteristics by province .......................Error! Bookmark not defined.
Table 3: Biofuels plant construction impacts ........................................................... 74
Table 4: Biofuels plants operations impacts ............................................................. 75
Table 5: Long term potential annual economic impact of the biofuels industry .... 76
Gardner Pinfold
APRI No. 200344
Summary
A large-scale biofuels industry does not now exist in the Maritime Provinces; accordingly, this
impact assessment addresses the question of what the impacts would be if such an industry were
to develop. The analysis traces the direct impacts, as well as the indirect impacts on those
industries supplying it with goods and services in particular the farming sector that would supply
feedstocks.
The emergence of a biofuels industry could create the demand for suitable crops that are not now
grown or not grown in sufficient quantities at acceptable cost to meet industry requirements. This
forms a key underlying assumption of this analysis that the crops needed to support a biofuels
industry are grown within the region, and grown within a cost structure that allows both the farms
and the biofuels industry to operate profitably.
The development of a biofuels industry would generate economic impacts during construction and
operation. The construction impacts shown in Table S-1 are for a single plant (assumes 25 million
l capacity) and would be transitory, working their way through the economy largely during the 1824 months it takes to build a plant. Capital costs and resulting impacts vary among the provinces
according to the type of plant and corresponding feedstock: New Brunswick biodiesel/canola;
Nova Scotia ethanol/corn; Prince Edward Island ethanol/sugar beet.
Table S-1: Biofuel plant construction impacts

New Brunswick
Nova Scotia

Capital cost
42,200
35,200
27,800
17,724
10,128
4,220
32,072
24,992
7,392
4,659
37,043
10,008
2,502
4,475
16,985
346
116
65
526
287
90
60
436
168
48
44
260
14,348
10,972
2,532
27,852
14,432
4,576
2,589
21,597
6,116
1,946
1,668
9,730
1,069
5,013
2,194
8,276
1,261
3,888
1,830
6,979
570
1,751
1,446
3,767
GDP
Direct
Indirect
Induced
Total
Employment
Direct
Indirect
Induced
Total
Income
Direct
Indirect
Induced
Total
Tax revenue
Corporate
Personal
Sales & excise
Total
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APRI No. 200344
The allocation of plants by province shown in Table S-1 is notional; other feedstock and fuel
combinations by province are possible and, given the construction industry and supply capabilities
of each of the provinces, would yield impacts similar to those indicated.
Operations impacts continue annually over the production life of each facility. The total number of
plants constructed in the Maritime Provinces is speculative, but if enough capacity were built to
meet the ethanol and biodiesel mandates (13 plants), then the impacts shown in Table S-2 could
potentially result.
Table S-2: Biofuel industry annual economic impact estimates

New Brunswick
Nova Scotia
1 Plant
5 Plants
1 Plant
4 Plants
1 Plant
4 Plants
Maritime
Provinces
13 Plants
GDP
Direct
Indirect
Induced
Total
Employment
Direct
Indirect
Induced
Total
8,430
8,145
2,804
19,379
41,140
41,855
12,883
95,878
5,845
9,455
2,708
18,008
23,380
37,820
10,831
72,031
7,925
8,710
2,235
18,870
31,700
34,840
8,940
75,480
96,220
114,515
32,654
243,389
15
224
104
343
85
1,210
510
1,805
30
240
95
364
120
959
378
1,457
20
269
99
388
80
1,076
394
1,550
285
3,245
1,283
4,813
930
6,720
1,275
8,925
5,270
35,020
5,865
46,155
1,845
7,055
1,300
10,200
7,380
28,218
5,202
40,800
1,240
7,430
1,020
9,690
4,960
29,720
4,080
38,760
17,610
92,958
15,147
125,715
694
1,744
1,590
4,028
2,774
6,977
6,360
16,111
8,822
22,629
16,782
48,233
Income
Direct
Indirect
Induced
Total
Tax revenue
Corporate
715
3,532
629
2,516
Personal
1,607
8,308
1,836
7,344
Sales & excise
890
5,850
1,143
4,572
Total
3,211
17,690
3,608
14,432
Plants are notionally distributed across provinces to provide an indication of potential impacts by
province (single and multiple plants). For example, if a single plant were built in Prince Edward
Island, then it would generate about $19 million in GDP, and create 388 full-time equivalent jobs
paying almost $9.7 million in labour income. Total tax annual revenue realized from the operation
of a single plant and supporting industries would be about $4 million.
Draft 13-06-10
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1.
Introduction
1.1
Objectives
APRI No. 200344
This project, estimating the economic impact of the bio-fuels production industry, aims to
provide industry and government with a tool to further the development of a bio-fuels
industry in the Atlantic Provinces.
The main objective is to quantify the direct and spin-off impacts of developing a bio-fuels
industry in the Maritime Provinces. This will provide prospective investors, lenders and
governments with a better understanding of the scale of the industry and how its
development and operation would affect the economies of each of the Maritime
Provinces, including the impact on such key macroeconomic indicators as gross
domestic product (GDP), employment, labour income and tax revenues.
This analysis traces the direct impacts of the bio-fuels industry itself, as well as the
indirect impacts on those industries supplying it with goods and services in particular
the farming sector that would supply feedstocks. We would emphasize that that a largescale biofuels industry does not now exist in the Maritime Provinces; accordingly, this
impact assessment addresses the question of what the impacts would be if such an
industry did exist.
One caveat worth emphasizing is that this study is about the impact of a fully regional
biofuels industry. It is not about basing a biofuels industry on imported feedstock (e.g.,
corn or canola oil). Not only would this eliminate a major source of regional economic
impact growing the crops it would also weaken the supply security of any local
operation. The viability of such a business model would also be open to question, since
the alternative of simply shipping the final product (ethanol or biodiesel) is also possible
without incurring capital and operating costs for local production.
1.2
Outline
Following this introduction, Chapter 2 sets out the methodology used to estimate
economic impacts. It beings with the rationale for selecting specific fuels and
feedstocks, and outlines the basis for estimating the land needed to support a biofuels
plant under different crop assumptions (including crop yield and conversion factors).
This is followed by a discussion of the characteristics of the agriculture industry in the
Maritimes and how these characteristics affect the likely scale of biofuel plants. A review
of the demand for biofuels in the region follows, with an estimate of the number of plants
this regional demand could support. Finally, Chapter 2 sets out the economic indicators
used to quantify impacts at the direct, indirect and induced levels.
Chapter 3 contains the economic impact results during construction and operation.
Impacts are measured on a provincial basis using specified biofuel and feedstock
assumptions for individual plants and for a fully built-out industry based on the Chapter 2
demand estimates.
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2.
Methodology
2.1
Selecting options for impact assessment
APRI No. 200344
Biofuel feedstocks in the Maritimes

The challenge for this study is to answer the question, If a bio-fuels industry were to
develop in the Maritime Provinces, what would be its economic impact? Some firms in
the Region engage in the production of bio-fuels on a small-scale basis, but there is no
bio-fuels industry on a scale needed to meet the federal ethanol and bio-diesel
mandates. Consequently, there is no observable basis for documenting economic
impacts. Estimating the economic impact of such an industry in the region, accordingly,
must proceed by way of assumption, coupled with details of industry structure and
operation elsewhere.
Fortunately, much of technical information needed as a starting point for estimating
impacts is available from published sources. We have used this information to develop
a financial model for determining the financial feasibility of producing ethanol and biodiesel fuels using various feedstocks. That model, including key indicative cost and
revenue data, are described in the report, Infrastructure Build-out Investment Analysis,
forming one of a suite of studies in this Atlantic Canada Bioenergy Opportunities Project.
Several crops can be used as feedstock to produce bio-fuels. Corn, wheat, barley, sugar
beet and various cellulosic plants are potential sources of ethanol. Corn is the dominant
feedstock in North America (of Canadas 16 plants, the eight based in central Canada
use corn, while the other eight in western Canada use wheat). Canola and soybean are
the main feedstocks for bio-diesel, with soybean the main feedstock in North America
and canola in Europe (of Canadas 12 plants, the eight based in western Canada use
canola, while the other four in central Canada use mainly animal fats).
The production technology for both fuels is well developed.
Producing ethanol from starchy plants is a matter of using enzymes to convert

starches to sugars, and then fermenting the sugars with yeast and distilling the
alcohol. The use of sugar beets is a simpler process because it avoids the need
to convert starches to sugars. Choice of feedstock comes down to availability,
cost and energy content as these affect overall production economics.
Bio-diesel may be produced in one of two ways:

through a chemical process called transesterification where plant oil
obtained through crushing reacts with alcohol and a catalyst to separate
the methyl ester from the glycerides; the methyl ester (a crude bio-diesel)
is further processed into refined bio-diesel, while the glycerides are
distilled into glycerol and sold as a by-product.
through hydrolysis, where a plant oil (canola, soy or palm) is refined by

adding a hydrogen molecule to produce a true renewable diesel fuel.
This process is proprietary with limited global production, resulting in a
high cost fuel.
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The choice of feedstocks is driven largely by crops that are or can be grown, and grown
profitably, in the Maritime Provinces. The emergence of a biofuels industry could create
the demand for suitable crops that are not now grown or not grown in sufficient
quantities at acceptable cost to meet industry requirements. This forms a key underlying
assumption of this analysis that the crops needed to support a biofuels industry are
grown within the region, and grown within a cost structure that allows both the farms and
the biofuels industry to operate profitably.
Conditions in the Maritime Provinces are suitable for several potential feedstock crops
including corn, wheat, barley, soybean, canola and sugar beet. Cellulosic biomass crops
also offer potential (they contain much higher energy content than oil seeds, for
example), but the production technology has not yet developed to commercial scale.
For purposes of estimating potential economic impacts, we selected three crops,
assigning each to one of the provinces: Nova Scotia corn; Prince Edward Island
sugar beet; New Brunswick canola.
Factors driving feedstock requirements
The level of agricultural production is a function of the feedstock requirements of the
biofuels industry. The latter, in turn, is a function three things: the demand that a
Maritime biofuels industry is able to meet; the crop yields per hectare; and conversion
factors of each of the crop inputs (energy content in terms of litres of fuel). Of these,
biofuels demand is the most significant source of variability in determining impacts.
The biofuels industry in North America is driven mainly be Renewable Fuels Standards
(RFS) introduced by various levels of government in Canada and the US. The RFS
requires refiners and importers of prescribed fuels (i.e., gasoline, diesel and heating oil)
to blend these with specified volumes or percentages of renewable fuels:
Ethanol: In Canada, the federal RFS mandate is 5% ethanol for gasoline (though
refiners generally blend to 10% because of relatively low ethanol costs), and in
the U.S. the mandate is 10% with current consideration for 15% (some
provinces/states have higher mandates). In both countries, corn is the main
feedstock.
Biodiesel: the federal RFS mandate is 2% in both countries, with some

provinces/states mandating a blend as high as 5%.
To meet the RFS mandate in the Maritime Provinces (assuming refiners are required to
blend locally) would mean a requirement for up to about 250 ML of ethanol and 75 ML of
biodiesel (see Chapter 1, Fueling the Future, for a derivation of these volumes). In
fact, the potential biofuel opportunity is much greater since fuel produced with sugar
beets would qualify as a blendstock under the US RFS2. This opens up a substantially
larger export market that could easily double the Canadian-based demand.
Although it will be completely up to the proponents and investors/owners of the
production facilities, on what feedstock they will want to use, it should be noted that corn
ethanol plants are not likely a consideration for the Maritimes. This statement is based
on two considerations: that other feedstocks are likely to provide a higher return on
investment, and corn ethanol plants would not qualify for export to the U.S. based on the
RFS2 requirements.
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For purposes of estimating impacts, we take the 250 ML ethanol and 75 ML biodiesel
volumes as the basis for a biofuels industry in the Maritimes. The hypothetical impact on
land requirements of meeting these volumes is illustrated in Table 1, with the results
indicating that the industry is likely to evolve on the basis of feedstock production spread
across all three provinces. For example, Nova Scotia meeting the 250 million litre
ethanol demand would tie up about 45% of cleared farmland, not something that is likely
to occur. The percentages in the other provinces are also relatively high, suggesting
that spreading the requirements across provinces is the more likely developmental path
for the industry. This would minimize impacts on existing cropping patterns.
Table 1: Maritime Provinces land requirements for renewable fuel production
Product
Feedstock
Biofuel demand (ML)
Crop yield (t/ha)
Fuel conversion (L/t)
Crop (t)
Biofuel land area (ha)
Total cleared farmland by province (ha)
Biofuel potential as % of total land
Ethanol
Corn (NS)
250
6.50
400
625,000
96,154
215,000
45%
Ethanol
Sugar beet (PEI)
250
87.50
100
2,500,000
28,571
238,000
12%
Biodiesel
Canola (NB)
75
1.90
465
161,290
84,890
395,000
21%
Note: see Chapter 1, Fueling the Future for regional demand estimates.
2.2
Key industry assumptions
The question of scale is an important one, both from the perspective of biofuel facilities
and the structure and capabilities of the agriculture industry. The evidence suggests that
for biofuel facilities using conventional technology and feedstock, scale economies
improve up to about 100 ML and then tend to remain relatively stable. Farms in the
Maritime Provinces tend to be small, typically in the 150 ha range in New Brunswick and
Prince Edward Island, and in the 100 ha range in Nova Scotia.
Meeting the requirements of large-scale biofuels plants (100 ML) would require a
commitment from a sufficient number of farms within an economic radius of a plant. By
economic radius is meant close enough so that the transportation costs are low enough
to ensure an acceptable cost of the feedstock. This would vary depending on crop
characteristics and price, but a maximum radius of 50 km is typically cited. Within a radius
as large as this, there should be no difficulty meeting the feedstock requirements. For
example, at a 150 ha average farm size in PEI, the 75 farms needed to meet the sugar
beet tonnage required for one 100 ML ethanol plant (11,425 ha) could be contained in an
area with a radius of just over 6 km.7 Following the same approach, the 565 farms
needed to meet the canola tonnage required for one 75 ML biodiesel plant in New
Brunswick could be contained in an area with a radius of 16.5 km.8
This is derived by applying the formula for the area of a circle: r2 [3.14*(6.03 km)2 =
3.14*36.4km2 = 114km2 = 11,400 ha (@100 ha/km2)].
8
This is derived by applying the formula for the area of a circle: r2 [3.14*(16.5 km)2 = 3.14*272
2
km =855 km2 = 85,500 ha (@100 ha/km2)].
7
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APRI No. 200344
As a practical matter, feedstock is likely to be supplied from farms that are fairly widely
distributed within the economic radius. This reflects considerations of farm size and
characteristics, likely farm cropping patterns, and the constraint imposed by delivery
costs. These factors suggest that the evolution of the biofuels industry in the Maritime
Provinces is most likely to proceed on the basis of biofuels plants that fall below 100 ML
capacity. These smaller plants would nonetheless have to be strategically located in
areas of farm density that offer the potential for adequate and cost-effective feedstock
supply. There are, of course, numerous successful examples of this hub-spoke
production model in the region including potato processing, dairies and sawmills.
For purposes of this analysis, we assume biofuel plants (both ethanol and biodiesel)
have a capacity of 25 ML. This is not only more practical from a feedstock supply
standpoint, but also in terms of access to capital by companies in the region.
Additionally, new technologies considered in the Maritime Provinces and production
facilities that can utilize these technologies (i.e., closed loop facilities) allow smaller
plants to be more economical. To estimate the economic impact of meeting the 250 ML
ethanol and 75 ML biodiesel demand, we build up the industry in discrete 25 ML
increments, with plants located strategically across the Maritime Provinces.
A notional allocation of plants by province is shown in Table 2, with estimates of capital
and operating costs for each biofuel-feedstock combination. The allocation is notional
because it is unclear at this point how market forces would work to distribute the plants.
Since it is likely that cost-effective feedstock supply would be a major factor, a more or
less even distribution across the provinces makes sense. In any event, since overall
impact estimates are built up proportionately from the individual 25 ML plant impacts, it
is straightforward to approximate the impacts of a varying mix of plants by province.
Table 2: Plant characteristics by province
Biofuel type
Feedstock
Plant capacity
Capital cost ($million)
Operating cost ($million)
Feedstock
Labour and other
Biodiesel
Ethanol
Ethanol
Canola
25 ML
42.2
39.8
33.5
6.3
Corn
25 ML
35.2
21.2
15.9
5.3
Sugar beet
25 ML
27.8
18.1
13.5
4.6
Number of plants
New Brunswick
Nova Scotia
2
4
4
Note: see Chapter 3, Infrastructure and Build-out Investment Analysis for capital and operating cost
estimates.
2.3
Estimating impacts
Impact indicators and types

Economic impact arises as industry expenditures work their way through the economy. An
companys spending on inputs becomes the revenue of many another companies, which
they in turn they spend on inputs for the goods and services they produce, and so on.
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APRI No. 200344
The sum of this activity, generally referred to as economic impact, is conventionally

measured with four indicators:
GDP: an industrys contribution to Gross Domestic Product represents its

broadest measure of economic impact. The domestic product of the biofuels
industry captures the value it adds to purchased inputs (e.g., feedstock and
utilities) through the application of labour and capital. GDP represents the sum
of the value added by all firms in an industry, where value added is composed of
the income earned labour income, and returns to and of capital.
Employment: industry employment is important because of the significance

generally attached to jobs; from a purely economic impact perspective, the
significance lies in the economic impact generated through the spending of
employment income. The greater the employment and higher the average income,
the more significant the industry in terms of its overall economic impact. Unless
otherwise indicated, employment is measured in full-time equivalents (FTE).
Labour income: this captures payments in the form of wages and salaries
earned in an industry. Returns to labour in the form of wages, salaries and
earnings form a key component of GDP. Industries paying relatively high
average wages and salaries generate a correspondingly higher economic impact
than industries paying lower average incomes.
Tax revenue: this captures revenues from such sources as federal and
provincial sales taxes, as well as excise taxes applied to sales of petroleum
products used in production. It also includes estimates of personal and corporate
income taxes.9
Economic impacts are generated through direct, indirect and induced demand in the
economy expressed in terms of industry and consumer purchases of goods and services.
Direct impact: refers to impact generated by the activity of firms in the subject
industry (in this case biofuels). Direct GDP refers to the value added created by
biofuels companies, while direct employment refers to the jobs created on site by
these companies.
Indirect impact: refers to the impacts arising from purchased inputs triggered by
the direct activity. For example, biofuels companies buy feedstock from farms,
and utilities and chemicals from other suppliers. These farms and suppliers in
turn buy their inputs (e.g., seeds, fertilizers, fuel, equipment, professional
services) from other companies, and so on. Taken together, the process of
producing these goods and services creates profits, employment and income
generating indirect impacts.
Induced demand: refers to the demand created in the broader economy through
consumer spending of incomes earned by those employed in direct and indirect
activities. It may take a year or more for these rounds of consumer spending to
work their way through an economy.
The Statistics Canada I-O Model does not report personal and corporate income tax revenue
impact estimates; these are estimated independently using applicable personal and corporate rates, with
allowances for basic deductions and exemptions. The estimates do not take into consideration the effects of
deductions, exemptions and various income tax credits that may be specific to the biofuels industry.
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APRI No. 200344
The sum of impacts, particularly at the indirect level, gives the potential economic impact of
the Maritime Provinces prospective biofuels industry. Generally, the greater the regional
supply capability (multipliers) at each level, the greater will be the economic impact (and
vice versa). It should be obvious from the figures in Table 2, that the local supply of
feedstocks by far the main biofuels input ensures the regional impact will be high.
Quantifying the impacts the Input-Output Model
Economists rely on economic models to quantify impacts. Models provide a simplified
view of the economy, expressing the many demand and supply transactions in the
productive process as a set of coefficients or quantitative relationships. These
coefficients, including the level of employment and income generated per dollar of
expenditure, are based on empirical measurement of flows in the real economy with data
compiled through industry surveys conducted annually by Statistics Canada.
This study uses the Statistics Canada Inter-provincial Input-Output Model (2008 version)
to generate the economic impacts. The use of an input-output (I-O) model is considered
most appropriate for this study because this type of model:
produces direct, indirect and induced impact results the direct, indirect
and induced impacts, provided it has open and closed versions. Running the
open version allows labour income to leak out of the economy, with impacts
confined to indirect effects. Running the closed version forces labour income to
flow through the economy, resulting in an aggregate measure of indirect and
induced impacts. The difference between the two runs represents the measure
of induced impact.
produces results at a high level of resolution the I-O model is a matrix
capturing inter-industry flows of purchases and sales, thus allowing impacts to be
measured and reported at the highest resolution. Other types of models (e.g.,
general equilibrium and economic base) are structured at an aggregate
economic level, lacking the sensitivity to accept industry-specific shocks and
unable to produce industry-specific results.
Data requirement and sources

Ordinarily, quantifying economic impacts would begin with data on the gross value of
output for the biofuels industry in each province. Gross value of output means revenues
generated through sales of final product ethanol and biodiesel as well as any byproducts. The I-O Model breaks down the revenues to specific expenditure categories
including purchased inputs, wages and salaries and profit. As these expenditures work
their way through the economy (as captured by the I-O Model), they generate the GDP,
employment and labour income impacts the study aims to quantify.
This study takes a different approach. It uses the value of commodities used in the
production process to drive the I-O Model, rather than output value. This alternate
approach is necessary because at present there is no biofuels industry in the Maritime
Provinces, and therefore no coefficients that capture the demand and supply
transactions typical of this industry. Using commodity values gets around this deficiency
because the model does specify and quantify commodity linkages. So, for example, by
specifying the value of corn feedstock used in the ethanol process, the model quantifies
the indirect impact on the farming industry and other industries supplying goods and
services to farming.
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APRI No. 200344
3.
Economic impact results
3.1
Plant construction
The provinces will benefit from positive economic impact during construction (18-24 months) of
the biofuels plants. Impacts on a per plant basis are summarized in Table 3. These impacts
would occur in each province for each plant built. For example, each plant built in New
Brunswick would generate a direct GDP impact of about $18 million, with an overall impact of
almost $30 million when indirect and induced effects are included. The overall GDP impact
would be $60 million if two plants were built, and $120 million if four plants were built.
The capital costs vary depending on the technology. They are much higher for the canola plant
in New Brunswick because cost includes a seed crushing facility. The sugar beet plant,
incorporating less complex technology, stands at the low end of the cost spectrum.
Construction impacts in each province vary more or less in proportion to the capital cost of the
facilities. This would be expected, given the nature of construction projects. Where there are
differences in proportionality, they arise because of differences in the structure of the respective
economies. This is most noticeable at the indirect level, which reflects the capacity of the
provincial economy to supply goods and services.
Table 3: Biofuels plant construction impacts
New Brunswick
Nova Scotia

Capital cost
42,200
35,200
27,800
17,724
10,128
4,220
32,072
24,992
7,392
4,659
37,043
10,008
2,502
4,475
16,985
346
116
65
526
287
90
60
436
168
48
44
260
14,348
10,972
2,532
27,852
14,432
4,576
2,589
21,597
6,116
1,946
1,668
9,730
1,069
5,013
2,194
8,276
1,261
3,888
1,830
6,979
570
1,751
1,446
3,767
GDP
Direct
Indirect
Induced
Total
Employment
Direct
Indirect
Induced
Total
Income
Direct
Indirect
Induced
Total
Tax revenue
Corporate
Personal
Sales & excise
Total
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3.2
APRI No. 200344
Plant operations
Single plant impacts

The development of a biofuels industry will have a positive impact on the economies of the
Maritime Provinces. The impacts set out in Table 4 show that there is little difference in overall
impact amongst the provinces in terms of plant location. This should not be surprising, since
the plants incorporate similar technology and depend heavily on the local agriculture industry to
supply the feedstock.
Table 4: Biofuels plants operations impacts
New Brunswick
Nova Scotia
(GDP, Inc
GDP
Direct
Indirect
Induced
Total
Employment
Direct
Indirect
Induced
Total
8,430
8,145
2,804
19,379
5,845
9,455
2,708
18,008
7,925
8,710
2,235
18,870
15
224
104
343
30
240
95
364
20
269
99
388
930
6,720
1,275
8,925
1,845
7,055
1,300
10,200
1,240
7,430
1,020
9,690
715
1,607
890
629
1,836
1,143
694
1,744
1,590
3,211
3,608
4,028
Income
Direct
Indirect
Induced
Total
Tax revenue
Corporate
Personal
Sales & excise
Total
The dependence on the local agriculture industry shows up in the relatively high indirect impact
in each province. This is most noticeable with employment and labour income. For example,
whereas direct employment in the plants ranges from 15 to 30 persons, indirect employment
(mainly on farms) ranges from about 225 to 270, with labour income in the $6.7 to $7.4 million
range. Annual tax revenues (federal and provincial) from all sources range between from $3.2
to $4.0 million. Again, these figures quantify the per plant impacts for each province.
Gardner Pinfold
9
APRI No. 200344
Gross impacts
If the biofuels industry develops to its potential to supply the regional ethanol and biodiesel
volumes (Tables 1 and 2, above), then the region would experience a multiple of the estimated
impacts shown in Tables 3 (construction) and 4 (operation). Assuming the industry reaches its
full potential (based on regional demand), the annual impacts could be expected to approximate
those shown in Table 5, contributing just over $240 million to GDP, creating over 4,800 full-time
equivalent jobs, generating over $125 million in labour income, and over $48 million in federal
and provincial tax revenues.
Table 5: Long term potential annual economic impact of the biofuels industry
New Brunswick
Nova Scotia
1 Plant
5 Plants
1 Plant
4 Plants
1 Plant
4 Plants
Maritime
Provinces
13 Plants
GDP
Direct
Indirect
Induced
Total
Employment
Direct
Indirect
Induced
Total
8,430
8,145
2,804
19,379
41,140
41,855
12,883
95,878
5,845
9,455
2,708
18,008
23,380
37,820
10,831
72,031
7,925
8,710
2,235
18,870
31,700
34,840
8,940
75,480
96,220
114,515
32,654
243,389
15
224
104
343
85
1,210
510
1,805
30
240
95
364
120
959
378
1,457
20
269
99
388
80
1,076
394
1,550
285
3,245
1,283
4,813
930
6,720
1,275
8,925
5,270
35,020
5,865
46,155
1,845
7,055
1,300
10,200
7,380
28,218
5,202
40,800
1,240
7,430
1,020
9,690
4,960
29,720
4,080
38,760
17,610
92,958
15,147
125,715
694
1,744
1,590
4,028
2,774
6,977
6,360
16,111
8,822
22,629
16,782
48,233
Income
Direct
Indirect
Induced
Total
Tax revenue
Corporate
715
3,532
629
2,516
Personal
1,607
8,308
1,836
7,344
Sales & excise
890
5,850
1,143
4,572
Total
3,211
17,690
3,608
14,432
Net impacts
The impacts shown in Table 5 are gross impacts. They do not take into consideration economic
activity that might be displaced by the biofuels industry. Displacement could arise from
competition for inputs, particularly for crops used as feedstock (e.g., there could be less corn for
domestic consumption or canola for oil production).
As a practical matter, displacement of existing economic activity is expected to be minimal,
given that the economics of biofuels production indicates that sugar beet is the most likely
source of feedstock. There is no competition for this crop from the food or other industries (e.g.,
Gardner Pinfold
10
APRI No. 200344
sugar refining). Other potential feedstocks, including the ones assessed in this analysis corn
and canola are likely to be too expensive at current prices to allow biofuel plants to be viable.
Consequently, the gross values shown in Table 5 for sugar beet would be valid as indicators of
incremental economic impact. Since crop and ethanol production characteristics would be
similar across the provinces, the economic impacts shown for PEI would approximate closely
the level of impacts likely to occur in NB and NS.
Gardner Pinfold
11

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Fueling the Future:

Atlantic Canadas Bioenergy Opportunities Project

APRI No. 200344

ACBCs Executive and Board of Directors

Gardner Pinfold Consulting

Dr. Gerrard Marangoni

Atlantic Canada Opportunities Agency (ACOA)

Collge communautaire du Nouveau-Brunswick (CCNB)

Atlantic Canadas Bioenergy Opportunities Project

APRI No. 200344

Atlantic Canadas Bioenergy Opportunities Project

APRI No. 200344

Assets & Opportunity

Atlantic Canadas Bioenergy Opportunities Project

APRI No. 200344

10% Blend Ethanol

Diesel Fuel Oil

Nova Scotia Fuel Energy

New Brunswick Fuel Energy

Diesel Fuel Oil

PEI Fuel Energy

10% Blend Ethanol

Diesel Fuel Oil

Newfoundland Fuel Energy

10% Blend Ethanol

10% Blend Ethanol

Diesel Fuel Oil

Atlantic Canadas Bioenergy Opportunities Project

APRI No. 200344

Strengths characteristics that provide it an advantage.

Weaknesses (or Limitations) characteristics that create a disadvantage

Opportunities: external factors in the environment that could improve performance

Threats: external factors in the environment that could cause trouble

Atlantic Canadas Bioenergy Opportunities Project

APRI No. 200344

Atlantic Canadas Bioenergy Opportunities Project

APRI No. 200344

Atlantic Canadas Bioenergy Opportunities Project

APRI No. 200344

The Maritime Provinces adopt complimentary provincial renewable fuels

Atlantic Canadas Bioenergy Opportunities Project

APRI No. 200344

Atlantic Biofuel Capital Development Initiative: The introduction of a Government

Atlantic Canadas Bioenergy Opportunities Project

APRI No. 200344

Atlantic Biofuel Production Initiative: The Government of Canada introduces a

Primarily, to consider the recommendations of this report and initiate a broader

Atlantic Canadas Bioenergy Opportunities Project

APRI No. 200344

Seek to strengthen coordination, engagement and partnerships between industry,

Atlantic Canadas Bioenergy Opportunities Project

APRI No. 200344

Assets and Opportunity

Introduction to Bioenergy Feedstock

Regional Opportunities for Cellulosic Biofuels

Improving Production Costs of Ethanol and Biodiesel via the Integration of

Other Second Generation Feedstocks

The Agricultural Picture

Anticipated Feedstocks in Atlantic Canada

Preferred Feedstocks for the Maritimes

Consideration of Non-Agricultural Feedstock for the Region

Stakeholders in Atlantic Canada