USE OF BIO-FUELS IN BRAZIL

Alfred SzwarcConsultant

Ministry of Science and Technology

In-Session Workshop on MitigationSBSTA 21 / COP 10December 9, 2004

Buenos Aires

Brazilian experience with fuel grade ethanol started in the 1920’s. Variable ethanol content in gasoline

depending on ethanol availability…until

1973 OIL CRISIS & LOW SUGAR PRICES

PROÁLCOOL PROÁLCOOL BRAZILIAN FUEL ETHANOL PROGRAMBRAZILIAN FUEL ETHANOL PROGRAM

1975

• GASOHOL REGULARLY AVAILABLE SINCE 1977

• NEAT ETHANOL FOR ALCOHOL CARS AVAILABLE COMMERCIALLY SINCE 1979

(over 5 million ethanol fueled vehicles produced in Brazil)

FUEL ETHANOL TYPES

95.13 – 95.98Hydrous

99.58 minimumAnhydrous

alcohol content ºGL (at 20 ºC)

Type

Under Brazilian regulations two types of fuel ethanol are produced:

• Anhydrous: blended with automotive gasoline

• Hydrous: used as a neat fuel in vehicles or blended with gasohol by the consumer in FFV

Source: Portaria ANP Nº 126 de 08/08/2002

0,02,04,06,08,0

10,012,014,016,0

75/76 80/81 90/91 95/96 2003/04

0,6 3,7

11,512,6

14,7

Brazil: Ethanol production milestones(anhydrous + hydrous)

million m3/ crop season

~ 10% of total cultivated land

~ 1% of total land available for agriculture

SUGAR CANE - approx. 5 million ha - 60,000 producers - all-year-round harvest

C-S (80% land)

harvest: april/november

N-NE(20% land)

harvest: sept/march

Source: UNICA

Sugar Cane Production

314,9 306,9

257,6

293,1

320,6

357,5

303,1

200220240260280300320340360380

97/98 98/99 99/00 00/01 01/02 02/03 03/04

Crop season

Mill

ion

tons

Brazil: 1997/98 - 2003/04

Source: UNICA

About 50% of sugar cane is used for ethanol production

40,00

45,00

50,00

55,00

60,00

65,00

70,00

75,00

80,00

85,00

75 80 90 00 04

t ca

ne/

hec

tare

2,50

3,00

3,50

4,00

4,50

5,00

5,50

6,00

6,50

7,00

7,50

m3/h

ecta

re

t cane/hectare m3 ethanol/hectare

Productivity Gains

Center-South Region

Source: UNICA

FERTI-IRRIGATION WITH STILLAGE

ferti-irrigation with stillage helps to reduce use of water& chemical fertilizers and recovers soil fertility

bagasse

electricity

The sugarcane industry produces its own thermal & electric energy using bagasse as a fuel in co-generationsystems and it sells theexcess electricity to the publicgrid (presently 600 MW)

Autonomous Energy

Source: UNICA

SUGAR & ETHANOL PLANT IN BRAZIL

Bagasse

The Brazilian Ethanol Experience

% Ethanol in Gasoline(gasohol)

1977: 4.5%1979: 15%1981: 20%1985: 22%1998: 24%

1999: 20 to 24% SINCE 200220% to 25%

- Brazilian ethanol, gasohol & Flex-Fuel vehicles

- Imported gasohol vehicles and engines

• energy security & diversification

• technology development

• environmental benefits

• balance of payments

• jobs

• Vehicle can operate on gasoline or ethanol or any ethanol-gasoline blend without any special requirement

• Consumers’ good acceptance: 2004 sales projections !!!! 300,000 Flex Fuel units

“FLEX FUEL” Vehicles

The FLEX FUEL Concept

ENGINE

ECU

CatalyticConverter.

Exhaust

O2 Sensor

Sensor originally used for emission control measures O2 contentin exhaust gas and sends a signal to the Engine Control Unit(ECU) indicating the level of ethanol in the fuel line ! ECU automatically recalibrates spark timing and fuel injection.

Source: ANFAVEA / Prepared by ÚNICA Diesel vehicles are not included

Vehicle Market Share in Brazil

Sales Jan/Sept 2004: 35,497 Ethanol 218,320 Flex Fuel 942,993 Gasohol

% SALES OF LDV - DOMESTIC MARKET

0%

20%

40%

60%

80%

100%

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

FLEX FUELETHANOL

GASOHOL

Vehicle Emission Reductions Related to Fuel Ethanol Use in Brazil

Lead additives banned since 1990

Reduction of SOx

Reduction of PM (carbon and sulfate particles)

VOC´s with lower toxicity & photochemical reactivity

CO: Higher reduction in older E100 (up to 70%) and gasohol (up to 40%) vehicles in comparison withethnaol-free gasoline

Source: CETESB

Ethanol Production & Energy Balance by Feedstock

8.3Sugar Cane (Brazil)1.9Sugar Beet (EU)

1.3 – 1.8Corn (USA)1.2Wheat

Energy Output/Energy InputFeedstock

Source: F.O. Licht, Macedo, I et alii 2004 NREL 2002

0.83Gasoline

Sugar CaneSugar Cane and and thethe COCO22 CycleCycle

Ethanol Electric Energy

Neat Ethanol or Blends

Cogeneration

Sugar

COBagasse

Ethanol

Sugar

CO2

SOURCE: ADS

CO2

Sugar Cane Field

Photosynthesis

CO2

Greenhouse Effect Mitigation

Under Brazilian production conditions the substitution of ethanol for gasoline & bagasse for fuel oil avoids the emission of:

2.6 t of CO2 equivalent/m3 anhydrous ethanol1.7 t of CO2 equivalent/m3 hydrous ethanol

Source: Macedo, I et alii, 2004

1

10

100

0 50000 100000 150000 200000 250000Ethanol Cumulative Production (thousand m3 )

(Oct

200

2) U

S$ /

GJ

Ethanol prices in Brazil Rotterdam regular gasoline price

trend (Rotterdam gasoline prices) trend (Ethanol prices)

1986

2002

1999

1996

1980

19901993

Gasoline X Ethanol Prices

Source: Goldenberg, J. et alii, Biomass and Bioenergy, 26, 2004

New Uses for Ethanol

AVIATION FUEL(100% ethanol airplane by

Embraer. Already certified !!!!production will start in 2005

Ethanol Vaporizer

INDUSTRIAL FUEL 100% ethanol boiler

(boiler can operate also on CNG or LPG)

New Uses for Ethanol

DIESEL-ETHANOL BLENDS(Pilot Tests)

SOURCE TO PRODUCE HYDROGEN FOR FUEL CELLS

(Research Level)

Ethanol

Reformer

H2

Truck operating with diesel + 7% ethanol

+

SUGAR CANE

SOY BEAN

OR !!!! PEANUTS, SUNFLOWER, CORN, COTTON, PALM TREE......ETC.

Anhydrous Ethanol+Vegetable Oils = RenewableBiodiesel

New Uses for Ethanol: 100% Renewable Biodiesel

transesterification ETHYL ESTER

Biodiesel in Brazil

• Since the 1920’s ! initiatives to promote use of vegetable oilsin Brazil

• During the 1980’s: Pró-óleo and OVEG Programs ! limitedresults

• In 2002 MCT implemented the Research & TechnologyDevelopment PROBIODIESEL National Network

• 2003 Interministerial Commision evaluated feasibility of Biodiesel in Brazil and set recommendations for a program

• 2003: first Biodiesel specification (ANP 255/03)

• 2004: permission to use 2% biodiesel + 98% diesel blends (B2)

• December 6 2004: announcement of National Biodiesel Program

Vegetable Oil Sources in Brazil

Source: ABIOVE

NORTH REGION

Palm/Babassu/Soybean

CENTER-WEST REGION

Soybean/Castor Oil/Cotton/Sunflower/Palm

SOUTH REGION

Soybean/Rapeseed/Sunflower/ Cotton

SOUTH-EAST REGION

Soybean/Castor Oil/Cotton/ Sunflower

NORTH-EAST REGION

Babassu/Soybean/Castor Oil/ Palm/Cotton/Coconut

soybean oil represents over 95% of present vegetableoil production

Vegetable Oil Productivity in Brazil

Sunflower oil(45-55%)800Kg/ha

Soybean oil(18-21%)400Kg/ha

Peanut oil(40-50%)900Kg/ha

Castor oil(45-55%)

1200Kg/ha

Palm oil (Dendê)

(35-45%)

5900 Kg/ha

Source: LADETEL/USP - ABIOVE

Note: values in % indicate oil contentof each feedstock

• Biodegradable• Reduces emission of:

– Particulates– Carbon Monoxide– Sulphur oxides– Hydrocarbons– CO2

On a well-to-wheel basis it is estimated that:

biodiesel reduces CO2 emissions by 78% comparedto diesel oil

BIODIESEL – Environmental Aspects

Source: NREL 1998

Benefit is proportional to theamount of biodiesel used

Soybean biodiesel energy balance3.2 output energy/input fossil energy

For diesel oil the ratio is 0.83

(million hectares)

Total Area ………………........... 204Area good for agriculture...... 137Area in use for cattle raising... (35)Occupied area (forests & plantations) (12)Available Area for expansion..... 90

BRAZIL: Agribusiness ExpansionBrazil is one of the few countries with great capacity to

expand its agricultural production !!!!opportunitiesfor bio-energy and sustainable development

Expansion area in the“ Brazilian Cerrado” region

Source: EMBRAPA/MAPA

Thank You

www.mct.gov.br