In this paper, technical and economic prerequisites to attain reduced carbon dioxide (CO2) emissions through the use of biomass-based energy carriers in the transportation sector are studied. CO2 emission reduction per unit of land used for biomass production as well as costs for CO2 emission reduction are estimated when substituting rape methyl ester, biogas from lucerne, ethanol from wheat and ethanol, methanol and hydrogen from Salix (willow) and logging residues for petrol and diesel. Other environmental impacts resulting from an increased use of biomass-based energy carriers are briefly discussed. The study shows that the transportation fuels based on Salix will provide the largest CO2 reduction per hectare. For the technologies assumed to be avaialble in 5-10yr time, the costs for CO2 reduction will be lowest for methanol from Salix and logging residues; USD 230-430/tonne C at current biomass costs and USD 180-340/tonne C at estimated biomass costs around 2015, when used instead of petrol in internal combustion engine vehicles (ICEVs). Using biomass-based methanol in ICEVs will, at current biomass costs, result in 5-10% higher kilometre costs than for petrol-fuelled vehicles, and at estimated biomass costs around 2015, 4-8% higher costs, excluding fuel taxes. If on-going development is successful, ethanol from cellulosic feedstocks might achieve costs for CO2 reduction that are similar or lower than for methanol when the fuels are used in ICEVs, but the uncertainties are large. Ethanol is, however, in contrast to methanol, not a suitable fuel for fuel-cell electric vehicles. Biomass-based energy carriers used in battery or fuel-cell powered electric vehicles would provide twice the amount of transportation work per unit of biomass than if used in ICEVs Ltd.
