**An Integrated Approach to the Design of Centralized and Decentralized Biorefineries with Environmental, Safety, and Economic Objectives**

**Antioco López-Molina 1, Debalina Sengupta 2, Claire Shi 3, Eman Aldamigh 2, Maha Alandejani <sup>4</sup> and Mahmoud M. El-Halwagi 2,5,\***


Received: 3 November 2020; Accepted: 17 December 2020; Published: 20 December 2020

**Abstract:** Biorefineries provide economic, environmental, and social benefits towards sustainable development. Because of the relatively small size of typical biorefineries compared to oil and gas processes, it is necessary to evaluate the options of decentralized (or distributed) plants that are constructed near the biomass resources and product markets versus centralized (or consolidated) facilities that collect biomass from different regions and distribute the products to the markets, benefiting from the economy of scale but suffering from the additional transportation costs. The problem is further compounded when, in addition to the economic factors, environmental and safety aspects are considered. This work presents an integrated approach to the design of biorefining facilities while considering the centralized and decentralized options and the economic, environmental, and safety objectives. A superstructure representation is constructed to embed the various options of interest. A mathematical programming formulation is developed to transform the problem into an optimization problem. A new correlation is developed to estimate the capital cost of biorefineries and to facilitate the inclusion of the economic functions in the optimization program without committing to the type of technology or the size of the plant. A new metric called Total Process Risk is also introduced to evaluate the relative risk of the process. Life cycle analysis is applied to evaluate environmental emissions. The environmental and safety objectives are used to establish tradeoffs with the economic objectives. A case study is solved to illustrate the value and applicability of the proposed approach.

**Keywords:** biorefining; sustainable design; distributed manufacturing; centralized facilities; integration; CAPEX correlation

#### **1. Introduction**

A biorefinery is a processing facility which uses physical, chemical, biological, and/or biochemical processes to convert biomass into value-added products and energy. In recent years, biorefineries have garnered much interest and research as the energy demand and climate crisis become increasingly pressing issues. Biorefineries are essential for the sustainable development of energy and chemical resources while reducing greenhouse gas (GHG) emissions. Nonetheless, biorefinery sizes tend to be smaller than fossil-based refineries because of the relatively distributed nature of biomass compared to the large-scale production of fossil materials from specific regions [1,2]

The sources of biomass may be broadly classified as virgin biomass or waste biomass. Virgin biomass includes any new sources that are cultivated or otherwise grown for the purpose of using in the biorefineries. Examples of virgin biomass include sugarcane and corn for bioethanol, and soybeans and algae for biodiesel. Waste biomass may be derived from various sources such as municipal solid waste (MSW), agricultural waste, forestry-product and industrial wastes, and waste cooking oils and grease from restaurants. A biorefinery may be designed to handle multiple feedstocks [3]. In some cases, preliminary sorting is needed to separate the organic portions of the waste. For instance, sorting and mechanical methods are used to obtain refuse-derived fuel (RDF) from MSW.

Although the types of biomass are varied, the technologies to convert them to chemicals and fuels may be largely classified into the following main categories: biochemical or thermochemical platforms. Biochemical platforms include fermentation (aerobic or anaerobic) and transesterification. Thermochemical platforms include the utilization of heat and pressure in various combinations and processes like liquefaction, gasification, pyrolysis, and combustion are used to obtain products [4–6].

The biorefinery industry is complex and multifaceted and depends on many factors, including the scale, location, and its association with economic factors, logistic factors, market factors and industrial practices [7]. Furthermore, economic factors that affect a biorefinery as an industrial firm can be categorized into internal and external factors, the former are related to microeconomic or firm-level elements, such as capital, labor, operating cost, profit, and related risk. The external factors are related to macroeconomic and institutional-level determinants, such as real economic growth subsides, government intervention, institutional quality, and regulatory quality. From the microeconomic perspective, several measurements can be considered when evaluating the biorefinery process designs and performances. In order to acquire proper insights and accomplish significant outputs in connection with economic factors and optimal designs, it is crucial to estimate the economic feasibility of the process design of a new biorefinery plant. This is due to the high capital investment and operating costs that are commonly associated with biorefinery technologies [7–9]

Subsidies, which are an aspect of government economic policy, can be used as an instrument to stimulate renewable energy production [10]. Biorefinery projects may need government intervention and subsides to assist in technology development and profitable operations. Subsidies are an element of government expenditure and may be financed through public funds via several channels, including taxation and tariffs [11]. However, the subsidies implemented for renewable products have certain drawbacks. For example, subsidies that cannot correct market failures can result in an early exit from the industry; to illustrate, some energy products are potentially susceptive of market failure, as the prices of these products are determined by free market and international markets conditions, which can control the prices; that is a potential source of market failure that requires government intervention through adapting some new policies, such as corrective energy taxes [12,13]. Another form of subsidy that may be used in renewable energy production, particularly in the renewable energy certification system, is a hybrid of fees and subsidies. Examples of this include fee-rebate (or "Feebate"), Renewable and Green Certificate Market, and Renewable Identification Numbers (RIN) [14–16].

In order to protect the environment, mitigate climate change globally, and narrow the economic gap between developing and developed countries, several international institutions have established the Sustainable Development Goals (SDGs). The aim was to focus on innovation and sustainability in all forms and sectors, including industrial sectors, energy, ecosystem, climate change, and protecting natural species and the environment [17]. In addition, the SDGs have strongly recommended the development of bioenergy, biorefinery, and bioeconomy (UN-DESA/DSDG, 2018). Thus, a biorefinery has a significant role to play in the implementation of the goals within SDGs: (i) fostering resilience against climate change, (ii) enhancing the environment for green growth, (iii) creating opportunities for sustainable production and consumption of renewable resources, and (iv) conserving natural resources for future generations [18]. These goals will help create development opportunities that support local and global markets, estimated to be more than 1 trillion USD [18].

Important contributions have been made in the design and optimization of biorefineries. For recent reviews of the topic, the reader is referred to literature on the subject [5–8,19–23]. Relevant to the scope of this paper, several important research contributions have been made in the areas of optimal design of biorefineries and the assessment of their technical, economic, environmental, and safety objectives. To compare the options of standalone, centralized drop-in, and distributed drop-in (that uses pipelines for connection with processing facilities) for thermochemical biorefineries, Alamia et al. [24] calculated the efficiencies of the various options. Since distributed manufacturing offers unique benefits for environmental impact, Lan et al. [25] provided a life cycle analysis for decentralized preprocessing systems associated with biorefineries using pyrolysis. The complexity of designing integrated biorefineries and associated supply chains calls for the use of powerful optimization frameworks. Roni et al. [26] developed an optimization approach for the distributed supply chains of biorefineries with multiple feedstocks. Psycha et al. [27] developed a design approach for algae biorefineries using multiple feedstocks. To simplify the preliminary synthesis of integrated biorefineries, Bao et al. [28] introduced a shortcut process–synthesis method using high-level process technology details. Another shortcut approach developed by Tay et al. [29,30] used thermodynamic equilibrium models to design biorefineries. Because of the significant potential of integrated biorefineries towards sustainable development, sustainability metrics have been considered in several research efforts for the design of biorefineries. Meramo-Hurtado and González-Delga [31] used sustainability parameters to guide a hierarchical approach to designing biorefineries. Parada et al. [32] analyzed the incorporation of sustainability metrics and stakeholder perspectives in designing biorefineries. Andiappan et al. [33] developed a process synthesis approach for biorefineries with economic and environmental objectives. Traditionally, safety has not been considered as a primary objective during conceptual design of biorefineries. Typically, a biorefinery is first designed and then the safety aspects are subsequently assessed. There is a growing recognition of the importance of including safety during conceptual design [34,35]. Potential risks include fire, explosion, and release of toxic emissions. Different approaches for risk assessment may be used depending on the intended objectives, the stage of process design, and the available data and details. El-Halwagi et al. [8] presented a multiobjective optimization approach to the design of biorefineries with economic and safety objectives. Bowling et al. [36] addressed the problem of facility location of biorefineries as part of the integrated supply chains. Piñas et al. [37] carried out an economic assessment of centralized and decentralized biogas plants. Ng et al. [21], Tay et al. [38], and Ponce-Ortega et al. [39] used disjunctive fuzzy optimization for planning and synthesis of biorefineries while considering industrial symbiosis. Ng et al. [22] introduced a framework for optimizing mixture design in biorefining facilities. Sun and Fan [40] reviewed optimization methods for the supply chains associated with biorefineries. Notwithstanding the value of the aforementioned contributions, there are no published papers (to our knowledge) that provide a unified optimization-based approach to the screening, selection, and design of a combination of centralized and decentralized biorefineries while accounting for the technical, economic, environmental, and safety objectives.

Unlike fossil fuels that are produced in large quantities in specific regions, biomass is generated in a rather fragmented and nonconsolidated manner. Therefore, the sizes of biorefineries range from large, centralized facilities to smaller, decentralized facilities. Large processing facilities that use a single feedstock are able to achieve maximum economy of scale for capital expenditure (CAPEX) and produce market competitive products. Nonetheless, transportation of raw materials from distant areas increase the operating expenditure (OPEX) and may lead to detrimental environmental impact. On the other hand, small-scale biorefineries lose the advantageous economy of scale but reduce the transportation cost of biomass because they mostly use available raw materials from adjacent areas. Therefore, important decisions must be made on whether biomass should be collected from various regions and transported to a large facility (*centralized processing*) or if several biorefineries should be installed to treat biomass within a certain region (*decentralized or distributed processing*). Although economy of scale does not favor decentralized/distributed manufacturing, there are several advantages offered

by decentralized biorefineries, such as: (1) lower costs and emissions for transporting biomass to the facility and products to the market; (2) higher integration opportunities with other processing facilities (e.g., refining, gas conversion); (3) enhanced resilience especially to natural disasters by virtue of geographical distribution; and (4) increased flexibility in handling multiple feedstocks and generating multiple products. There is also a critical need for further research to understand the economic, environmental, and safety tradeoffs for centralized versus decentralized biorefineries. This paper presents a systematic approach for the comparison of centralized and decentralized biorefineries. A superstructure-based optimization formulation is developed to reconcile the various objectives while making important decisions on the plant capacity, technology, feedstock source and distribution, and product rate and distribution. A methanol-from-RDF case study is solved to illustrate the merits of the proposed approach.
