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Issues in Focus
The chart below shows the range of capital investment costs for the synthetic fuel technologies. A traditional crude oil refinery is shown as a point of reference. Each of the alternative fuel technologies is more expensive than an oil refinery, with a range of capital costs for each technology resulting from individual site location factors, facility layouts, competing vendor technologies, and production scale. Over time, investment costs for synthetic fuel facilities are expected to decrease as a result of “learning-by-doing.” As the installed base of synthetic fuel plants grows, cost reductions are expected to parallel those seen in the past for LNG liquefaction facilities, which have achieved cost reductions of two-thirds over the past three decades. At present, observed capital costs generally are inversely proportional to installed capacity. There is about 300,000 barrels per day of installed corn ethanol capacity in the United States, whereas biodiesel capacity amounts to about 12,000 barrels per day of dedicated capacity plus another 7,000 barrels per day of swing capacity from the oleochemical industry. The liquefaction industry is still in its infancy. At present there are no commercial GTL or CTL plants in the United States other than pilot plants. Worldwide, GTL capacity is nearly 60,000 barrels per day (Malaysia and South Africa) and global CTL capacity totals 150,000 barrels per day at the original development plants in South Africa. There is no commercial BTL capacity in the United States or elsewhere in the world, except for pilot plants. Putting the current production capacity of these various fuels into perspective with traditional oil-based fuels, U.S. refining capacity for all nonconventional liquid fuels is over 17 million barrels per day, out of a worldwide total that is approaching 83 million barrels per day. |
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