Jatropha Curcas and Bio-Diesel Development in Madagascar
Jatropha Curcas and Bio-diesel Development in Madagascar
Outline• Definition of bio-diesel• Agricultural techniques and plantations of Jatropha Curcas• Oil extraction and bio-diesel production• Markets and prices• Bio-diesel development models• Legal and regulatory framework• Economic and environmental impacts• Conclusions and recommendations
What is BIO-DIESEL?• Bio-diesel is diesel produced from vegetal oil• The process is a well known technique called «Trans-esterification». It is now profitable because of high prices of fossil oil.• Bio-diesel can totally replace fossil diesel, or can be mixed with it.• Vegetal oil from the seeds of Jatropha Curcas is among the best source of bio-diesel.
Why Jatropha Curcas?• Shrubs (2 to 5 meters) growing on poor soils, in dry to humid areas• Low cost, easy to grow, perennial plant (40 years).• First harvest after 18 months• Produces cheap, but toxic, vegetal oil: no need of subsidies to produce bio-diesel• Farmers can make $200 to 250$/ha/year on marginal lands• No competition with food or cash crops
TECHNIQUE OF PLANTING Seeds NURSERY Direct sowing in 3kg/ha seeds pot Cost of nursery: Young plant in pot $60/ha PLANTATION Hole digging 2500 plants/ha Cost of plantation: Transplantation $70/ha Pruning-Weeding Yield: Harvest At least 5T/ha Harvest : Drying -Sorting Feb to August Packaging-Storage
PROCEDE D’EXTRACTION OIL EXTRACTION – PRODUCTION OF BIODIESEL Seeds Graines Crushing Décortiquage-Broyage Vapeur d’eau- Steam humidification Heating Chauffage Expelling Trituration-Pression Filtration Seed cake Tourteau Crude brute Huile oil Yield: Used as 30%Fertilizer or Charcoal Refinery RAFFINAGE BIODIESEL
D1Oils plc• UK company, listed on the London Stock Exchange; among the world leaders in bio-diesel processing and production.• Works in the UK, Southern Africa/Madagascar, India, Asia/Pacific and Australia/New Zealand.• Has developed a small refinery, to produce bio-diesel from Jatropha oil that meets high quality European norms. Capacity: 8000 T/year of bio-diesel.
By-Products from Seed Cake• Organic fertilizer with high content in Nitrogen (5%).See results of tests on rice below.• Jatropha briquettes could be used as substitute tocharcoal: early stage of research•Biomass for electricity production. 6 Rendement de paddy (t/ha) 5 4 Rendement SRI 3 Rendement SRA 2 1 0 T0 T1=0,5 T2=1 T3=2 T4=3 Dose de tourteau (t/ha)
Crude Oil MarketRural Communities: (soaps, lights). Limited impacts.Domestic soap industry: raw material, often blended with palm oil. Larger market but problem of toxicity.
Bio-diesel Markets• Domestic market: mandatory incorporation in fossil diesel (5% in Madagascar in 2010). This is a $15/20 million market• International Market: An European Union directive recommends that 5.75% of all diesel consumed in Europe must come from vegetal source by 2010 . This represents a market of more than $40 billion, with heavy subsidies by European Union to bio-diesel producers. In India, 20% of the diesel market will be bio-diesel in 2020.
Prices of Fossil Oil and Bio-diesel • Assumption: Prices of bio-diesel are equal to prices of imported fossil diesel that vary depending on prices of fossil oil/barrel. • Bio-diesel producers will buy crude Jatropha oil from farmers at a price which is approximately $200 less than the bio-diesel price. Linkages between prices of fossil oil, fossil diesel/bio-diesel and crude Jatropha oilPrice of fossil 55 60 65 70 75 80 oil/barrel Price of bio-diesel = fossil 569 621 672 724 776 828 diesel C&FMadagascar/TPrice of crude 350 400 450 500 550 600Jatropha oil/T
Bio-diesel development Model Outgrower Scheme Farmers Bio-diesel refiners• Associations of smallfarmers Contracts • For instance, the local branch of• Big farmers D1Oils plc.• Private firms CrudePlantation - Extraction Refining into Biodiesel oil • Provide Technical assistance• Grow Jatropha. • Give seeds, plastic pots• Extract crude oil • Fund nurseries• Follow instruction ofD1 • Purchase crude Jatropha oil
Bio-diesel Development Model Outgrower scheme M Nurseries Expellers Plantations Refineries Villages Crude Jatropha M:model farm oil
Bio-diesel Development Model Outgrower Scheme Challenges• Securing land tenure.• Signing mutually profitable contracts with farmers• Financing farmer plantations.• Identifying and financing appropriate post harvest technology (Expellers).• Setting up an efficient logistical network.
Bio-diesel Development Model Integrated Industrial project• Plantations and infrastructure: $2 million for 5,000 ha.• Industrial seed crushing unit (150 T/day): $1,5 million• Bio-diesel refinery (8,000T/year): $4 million• Organic fertilizer mixing and bagging plant (15,000 T/year): $200,000• Total investments: about $8 million.• Conditions: secured land tenure, mandatory incorporation of bio-diesel, appropriate harbor and logistical facilities, partnership with bio-diesel refiner
Legal and Regulatory Framework• Bio-fuel definition: • Fuel from biomass (animal or vegetal origin) Ex: Bio-diesel, bio-ethanol• Role of Government: • Encourage production of bio-diesel • Determine level and starting date for mandatory incorporation in fossil diesel • Establish quality standards and monitor competitiveness • Provide fiscal and custom incentives for bio-diesel processors/refiners: tax holiday for 5 years, duty free import of equipment and inputs, exemption of VAT and environmental tax.
Impacts of bio-dieselEnvironmental impacts – Reduction of air pollution • Green fuel: reduction of carbon emission • Jatropha trees absorb CO2 – Renewable resource – Soil protection, erosion controlEconomic impacts – Additional income for farmers – Job creation: 250 men/day/ha – Foreign currency gains – Can attract large investments
Conclusions: How to Promote Bio-diesel • Design and implement a broad sensitization campaign • Train farmers and disseminate best cultural practices • Identify best extraction technology and equipment • Help establish productive linkages between farmers and bio-diesel producers. • Promote research to valorize Jatropha cake as an alternative to charcoal and/or as a fertilizer. • Work with the Government and all stakeholders to develop a conducive legal and regulatory framework • Identify, attract and assist foreign producers/refiners of bio-diesel
WINNER support to Jatropha development– WINNER will provide financing and technical assistance for Jatropha plantation and processing, working with farmer associations and private enterprises.– We will be assisted by D1-BP Fuel Crops Limited, which has 220,000 ha of Jatropha curcas under cultivation in South East Asia, Africa and India.– D1 Oils has developed a global research programme on 300 J. curcas cultivars with a Jatropha breeding station in Cape Verde and development centres in Zambia, Swaziland, India, Thailand and Indonesia.– WINNER Interventions: Planning and evaluation phase; Cultivar improvement ; Agronomy research (nursery trials, inter-cropping, pruning, fertilization); Out-grower management systems (extension manuals, training of extension officers, etc,); dissemination of appropriate processing technology (expellers).–
Costs of Energy in Haiti in 2003Sources National % Price/T. Value % Consum. (US $) (KUS (MT) $/T)Fuelwood 401,355 36 100 40,135.5 9Charcoal 207,000 18 300 62,100.0 14Gasoline 118,650 10 1,050 124,582.5 27Kerosene 76,220 7 750 57,165.0 13 Diesel 321,300 29 523.6 168,232.7 37
Haiti Diesel Price StructurePrice category Cost (US$)Price at terminal 1.9900Fees 0.2036Taxes 0.1809Company margin 0.4008Transport Cost 0.0542Total 2.8295
Main data on Biodiesel for Haiti In Metric Tons and US Dollars• Diesel imports (2006 estimations): about 350,000 T or 100 million gallons.• Domestic market (2006): around $220 million• Proposed biodiesel alternative: BP20 (20% biodiesel).• Biodiesel needed: 70.000 T or approximately 20 million gallons• Rough industrial investment (based on D1 Oils data): around $35 million• Jatropha plantations : between 100,000 and 70,000 ha.• Cost of plantation: approximately $100/ha (cuttings) to $300/ha (seedlings): At least $10 million• Cost of oil expellers for farmer cooperatives: about 280 units x $5,000: $1,4 million.
Next Steps• Clearly define goals in terms of market share.• Develop a business plan based on above goals• Set up a Haitian company and put in place a good organization• Start plantations during next rainy season