It is expected that 90% of the increase of CO2 emissions in Europe between 1990 and 2010 will be attributable to transport. In the short and medium term, use of biofuels can be an important mean to reduce the GHG emissions from the transport sector.The second generation biofuels based on lignocellulosic biomass has a significant potential in Norway because of vast forest resources. The development of second generation biofuels will however imply increased competition for biomass, increased international biomass trade, and increased biomass prices. The increased prices will strongly affect the business environment for heat and power production based on biomass, and the forest industries will face new domestic and international competition for their raw m aterials. The objective of this project is to describe and analyse how the future development of second generation biofuels will influence:1.Costs and biomass input per unit of cellulosic biofuels2. The potential for production of biofuels in Norway under various market and policy assumptions and under different technology scenarios.3.Price and availability of biomass for production of biofuels, heat and power from Norwegian sources as well as from import under different scenarios.4.Optimal locatio n of production facilities for biofuels5.Production of biofuels, bioenergy and forest industrial products under different energy scenarios. 6.Energy planning and design of policy instruments University of Minnesota, USDA Forest Products Lab, Madison, USA and University of Lappeenranta, Finland will be international partners in the project. For Agder Energi as, the industrial partner in the project, the project will give valuable overview of the economical and technical development of second generation biofuel and contacts and networks with research institutions and companies in the USA and Finland.
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