Electrification and the bioeconomy: three sides to the story

The document examines how the bioeconomy interacts with the rise of cheap solar, wind, and battery technologies. It identifies competitive pressures in ground transport and power generation, complementary roles for bioenergy in aviation, marine transport, and heavy industry, and synergistic opportunities where electrification enables bioeconomy value chains and lower-carbon biofuel production.

• The falling costs of solar photovoltaics, wind turbines, and lithium-ion batteries are transforming energy markets, enabling cost-parity with fossil fuels in many markets without subsidies and providing cost-efficient decentralized electricity solutions for low-income countries.
• Electrification and bioenergy can have a competitive relationship, particularly in ground transport where electric vehicles may disrupt liquid fuel demand. While biofuels can accelerate the phase-out of fossil fuels in existing internal combustion engine fleets, over-reliance on them may create a lock-in that delays the transition to clean electrification.
• Bioenergy provides complementary value to VRE-based systems by offering dispatchable electricity generation, which contrasts with the weather-dependent nature of wind and solar power.
• In sectors where batteries are insufficient, such as aviation and marine transport, biofuels remain a primary alternative to fossil fuels in the medium to long term.
• Biomass can support the decarbonization of heavy industries like steel and cement, either by substituting fossil fuels in existing processes with carbon capture and sequestration (CCS) or by providing a carbon source for radical technology shifts toward electrification.
• Electrification can synergistically boost the bioeconomy in low-income countries by providing the power necessary for irrigation, refrigeration, and crop processing, which are currently bottlenecks for agricultural value chains.
• The use of electrolysis powered by low-carbon electricity to produce hydrogen can reduce the carbon footprint of biofuel production by replacing the dominant steam reforming process based on natural gas.
• To remain economically viable against cheap electricity, bioenergy producers should adopt broad-based bioeconomy business models, such as biorefineries, that generate multiple revenue streams and maintain technical flexibility to shift output between products.

APA

Olsson, O., & Bailis, R. (2019). Electrification and the bioeconomy: three sides to the story. Stockholm Environment Institute. https://www.sei.org/wp-content/uploads/2019/12/biofuels-electrification-discussion-brief-nov-2019.pdf

Chicago

Olsson, Olle, and Rob Bailis. Electrification and the bioeconomy: three sides to the story. Stockholm Environment Institute, 2019. https://www.sei.org/wp-content/uploads/2019/12/biofuels-electrification-discussion-brief-nov-2019.pdf.

Wikipedia

{{cite report |last1=Olsson |first1=Olle |last2=Bailis |first2=Rob |title=Electrification and the bioeconomy: three sides to the story |publisher=Stockholm Environment Institute |date=November 2019 |url=https://www.sei.org/wp-content/uploads/2019/12/biofuels-electrification-discussion-brief-nov-2019.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{olsson2019electrification, author = {Olsson, Olle and Bailis, Rob}, title = {{Electrification and the bioeconomy: three sides to the story}}, institution = {Stockholm Environment Institute}, year = {2019}, month = nov, url = {https://www.sei.org/wp-content/uploads/2019/12/biofuels-electrification-discussion-brief-nov-2019.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }