Universidade Estadual de CampinasUNICAMP<br />The creation of a domestic market for bio-ethanol in Brazil and perspectives...
Structure of this presentation<br />Creating the market for ethanol<br />National infra-structure<br />Production<br />Dis...
The strategy<br />Identification of the public good: rationale for a public policy (and public funds)<br />LPG: energy as ...
Ethanol strategy<br />Large incentives to producers 1979-85<br />Subsidies to newdistilleries, retrofits, upgrades, etc<br...
Ethanol National Program: <br />Proálcool (1975-1985): Productiongrowsfrom 0.6 to 11.6 Bi litres<br />Post-85: estabilizat...
National automobile production (1979-2003)<br />Note: includes diesel, gasoline and alcohol vehicles<br />Source: ÚNICA, 2...
Ethanol production learning curve<br />
Ethanol and gasoline prices<br />
Brazilian Production <br />Evolution of Production: sugarcane, sugar and ethanol<br />
Light fleet vehicles and Consumption of Ethanol (Hydrous and Anhydrous)<br />
Improvements overtime<br />Results of Public and Private investments in R&D<br />
Productivity (t/ha)<br />Season 06/07 -84 t/ha<br />81.5<br />77.7<br />73.3<br />55.7<br />IBGE, 2003<br />
Evolution of the fermentation yield<br />
Evolution of the fermentation period<br />
Conclusions: Ethanol<br />Strong governmental presence<br />Supply: governmental purchased total production from private s...
BIOFUEL PRODUCTION COSTS<br />Doornbosch and Steenblink, 2007         Note: 1. Oil price US$ 20 – 70/barrel<br />
LAND AVAILABLE FOR ENERGY BIOMASS PRODUCTION IN 2050 (Gha)<br />Doornbosch and Steenblink, 2007<br />
Present Location of Sugar-Ethanol Mills in Brazil<br />
Near Term Expansion of New Sugar-Ethanol Mills (  ), C-S <br />
Brazil: main crops 2007<br />Brazil: 851 106 ha<br />Total Arable land: 350 106 ha<br />
Displacement of World Gasoline and Diesel Consumption (10%)<br />Notes: 1. 150 billion liters ( 120 billion liters of gaso...
ETHANOL AND BIODIESEL GHG REDUCTION<br />Doornbosch and Steenblik        Notes: 1. Compared with gasoline;  2. Compared wi...
ENERGY BALANCE IN ETHANOL PRODUCTION<br />Notes: 1-Source: ORNL, 2- Source: Copersucar/UNICAMP, 3- Corn Stover not include...
COST OF GHG EMISSION REDUCTION  DUE TO SUBSIDIES TO ETHANOL AND BIODIESEL(US$/ton of CO2 equivalent)<br />Doornbosch,R. an...
BIOFUELS ENERGY AND GHG BALANCES<br />IEA, WEO2006<br />NER=Net Energy Ratio (output renewable energy/input fossil energy)...
ENERGY PERFORMANCE OF ENERGY CROPS IN EU<br />IEA, WEO2006<br />Solid fuel<br />Brazilian conditions<br />Includes all bio...
Ethanol: a new commodity<br /><ul><li>Good business for tropical countries
 Challenges:</li></ul>	- regularity and guarantee of supply<br />	- price stability<br />
Sugarcane: world cultivated area and production <br />FAO, 2005<br />
Ethanol resists to oil prices fluctuation<br />
NIPE-Unicamp Ethanol Project <br /><ul><li>Coordinator:
Professor Rogério Cezar de Cerqueira Leite (UNICAMP)
Vice-Coordinators:
Dr. Manoel Sobral Jr (phase I)
Dr. Manoel Regis Lima Verde Leal (phases I e II)
Dr. Luís Cortez (phase III)
9 senior researchers, around 20 researchers involved
Collaboration: CGEE, MCT, MAPA, EMBRAPA, TRANSPETRO, PETROBRAS, DEDINI, CTC
Project in agreement with the Brazilian Agro energy Policy</li></li></ul><li>Specific Objectives<br /><ul><li>OE1: Present...
OE2: Assessment of new technologies (Carlos Rossell, PhD. and Oscar Braunbeck, PhD.) – phase II and phase III
OE3: Selection ofpotential suitable areas for sugarcane production in Brazil  (Manoel Regis Leal, PhD.) – phase II and pha...
OE4: Infra-Structure: existing and need for improvement and expansion (Mirna Gaya Scandiffio, PhD.) – phase I and phase III
OE5: Assessment of socio-economic impacts (A.Scaramucci, PhD.) phase I and phase II
OE6: Construction of ethanol production scenarios and socio-economic impacts  (André Tosi Furtado, PhD.)
OE7:Assessment of environmental impacts (M.Jannuzzi, PhD.) – phase II and phase III
OE8:Legislation and policies in different countries: producers and buyers  (Manoel Sobral Jr., PhD.) – phase III</li></li>...
POTENTIAL FOR SUGAR CANE PRODUCTION:<br />SOIL AND CLIMATE - WITHOUTIRRIGATION<br />High<br />Average<br />Low (World aver...
POTENTIAL FOR SUGAR CANE PRODUCTION:<br />SOIL AND CLIMATE – WITH IRRIGATION<br />High<br />Average<br />Low (World averag...
Ethanol transport – Brazil  1980 and 2007<br />Pipelines and Hydro ways are the best way to transport Ethanol from the cos...
Ethanol Exports by 2025: 205.5 million of m3<br />Area=Prod. 106 m3<br />Clusters(c)<br />
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The creation of a domestic market for bio-ethanol in Brazil and perspectives of future expansion of ethanol production

  1. 1. Universidade Estadual de CampinasUNICAMP<br />The creation of a domestic market for bio-ethanol in Brazil and perspectives of future expansion of ethanol production<br />Gilberto De Martino Jannuzzi<br />18. June 2008<br />HS XV, Institut für Geodäsie, Nussallee 16, UniversityofBonn<br />
  2. 2.
  3. 3. Structure of this presentation<br />Creating the market for ethanol<br />National infra-structure<br />Production<br />Distribution<br />Retail market <br />Affordability to final consumers<br />The private sector: the “Usineiros”, car manufacturers, <br />Ultimate objective: self-sustainable business (market) Social objectives (energy as public good) and strategic objectives (security of supply as a public good)<br />Public sector component<br />
  4. 4. The strategy<br />Identification of the public good: rationale for a public policy (and public funds)<br />LPG: energy as a social need (mid 60’s)<br />Alcohol: energy as a “national security” issue (late 70’s)<br />Strong governmental role in the economy:<br />State company Petrobras <br />Alcohol: purchase from private producers, distribution<br />Institutional and regulatory stability<br />Ability to introduce subsidies and incentives, pricing controls<br />Strong participation of the private sector since the start-up:<br />Alcohol: production, automobile industry<br />
  5. 5. Ethanol strategy<br />Large incentives to producers 1979-85<br />Subsidies to newdistilleries, retrofits, upgrades, etc<br />Governmentpurchasedallproductionatgivenprice<br />Final subsidies to ethanolconsumers, nationalfixedpricing, country-widedistribution<br />Blendswithgasolineandintroductionof 100% ethanolfuelledcars<br />Incentives (taxcuts) for ethanolcars (privatefleet), specially taxis andgovernmentfleets<br />Gasolinetaxedheavily (1979-85)<br />After 1985: lackofclear policies, higher sugar prices<br />Private sector (sugar industry) becameinterested in increasedproductivitiy<br />
  6. 6. Ethanol National Program: <br />Proálcool (1975-1985): Productiongrowsfrom 0.6 to 11.6 Bi litres<br />Post-85: estabilizationofethanolproduction supplyshortage in 1989 <br />Nineties: <br />Deregulation <br />Priority for sugar and sugar exports<br />Internalmarketgrows: flexfuelvehicles in 2003<br />Results in increasing agricultural and industrial productivity<br />
  7. 7. National automobile production (1979-2003)<br />Note: includes diesel, gasoline and alcohol vehicles<br />Source: ÚNICA, 2004<br />
  8. 8. Ethanol production learning curve<br />
  9. 9. Ethanol and gasoline prices<br />
  10. 10. Brazilian Production <br />Evolution of Production: sugarcane, sugar and ethanol<br />
  11. 11. Light fleet vehicles and Consumption of Ethanol (Hydrous and Anhydrous)<br />
  12. 12.
  13. 13. Improvements overtime<br />Results of Public and Private investments in R&D<br />
  14. 14. Productivity (t/ha)<br />Season 06/07 -84 t/ha<br />81.5<br />77.7<br />73.3<br />55.7<br />IBGE, 2003<br />
  15. 15.
  16. 16. Evolution of the fermentation yield<br />
  17. 17. Evolution of the fermentation period<br />
  18. 18. Conclusions: Ethanol<br />Strong governmental presence<br />Supply: governmental purchased total production from private sector<br />Petrobras (government) responsible for country-wide distribution<br />Subsidies, incentives, tax cuts<br />Price controls<br />Strong and important private sector participation as part of the supply chain (and demand sector) but supported by the government (guaranteed revenues and buffer to sugar prices fluctuation), automobile industry<br />De-regulation (mid-eighties)<br />Program too expensive to Petrobras<br />Discussion about purchase prices from producers <br />Producers from the Southeast decided to invest in productivity gains<br />Quality controls now under the Petroleum agency (ANP)<br />Producers can sell directly to pump stations<br />Prices set by the market, with ANP oversight<br />Introduction of bi-fuel cars since year 2002<br />
  19. 19. BIOFUEL PRODUCTION COSTS<br />Doornbosch and Steenblink, 2007 Note: 1. Oil price US$ 20 – 70/barrel<br />
  20. 20. LAND AVAILABLE FOR ENERGY BIOMASS PRODUCTION IN 2050 (Gha)<br />Doornbosch and Steenblink, 2007<br />
  21. 21. Present Location of Sugar-Ethanol Mills in Brazil<br />
  22. 22. Near Term Expansion of New Sugar-Ethanol Mills ( ), C-S <br />
  23. 23. Brazil: main crops 2007<br />Brazil: 851 106 ha<br />Total Arable land: 350 106 ha<br />
  24. 24. Displacement of World Gasoline and Diesel Consumption (10%)<br />Notes: 1. 150 billion liters ( 120 billion liters of gasoline)<br /> 2. 135 billion liters ( 120 billion liters of diesel)<br />
  25. 25. ETHANOL AND BIODIESEL GHG REDUCTION<br />Doornbosch and Steenblik Notes: 1. Compared with gasoline; 2. Compared with mineral diesel<br />
  26. 26. ENERGY BALANCE IN ETHANOL PRODUCTION<br />Notes: 1-Source: ORNL, 2- Source: Copersucar/UNICAMP, 3- Corn Stover not included,4- Tops and leaves not included, 5- Does not include credit for co-products, 6-Includes credit for 8% bagasse surplus<br />
  27. 27. COST OF GHG EMISSION REDUCTION DUE TO SUBSIDIES TO ETHANOL AND BIODIESEL(US$/ton of CO2 equivalent)<br />Doornbosch,R. and Steenblik,R. (OECD),2007<br />
  28. 28. BIOFUELS ENERGY AND GHG BALANCES<br />IEA, WEO2006<br />NER=Net Energy Ratio (output renewable energy/input fossil energy)<br />
  29. 29. ENERGY PERFORMANCE OF ENERGY CROPS IN EU<br />IEA, WEO2006<br />Solid fuel<br />Brazilian conditions<br />Includes all biomass<br />
  30. 30. Ethanol: a new commodity<br /><ul><li>Good business for tropical countries
  31. 31. Challenges:</li></ul> - regularity and guarantee of supply<br /> - price stability<br />
  32. 32. Sugarcane: world cultivated area and production <br />FAO, 2005<br />
  33. 33. Ethanol resists to oil prices fluctuation<br />
  34. 34. NIPE-Unicamp Ethanol Project <br /><ul><li>Coordinator:
  35. 35. Professor Rogério Cezar de Cerqueira Leite (UNICAMP)
  36. 36. Vice-Coordinators:
  37. 37. Dr. Manoel Sobral Jr (phase I)
  38. 38. Dr. Manoel Regis Lima Verde Leal (phases I e II)
  39. 39. Dr. Luís Cortez (phase III)
  40. 40. 9 senior researchers, around 20 researchers involved
  41. 41. Collaboration: CGEE, MCT, MAPA, EMBRAPA, TRANSPETRO, PETROBRAS, DEDINI, CTC
  42. 42. Project in agreement with the Brazilian Agro energy Policy</li></li></ul><li>Specific Objectives<br /><ul><li>OE1: Present technology and possible improvements (E.Gomez,PhD.)
  43. 43. OE2: Assessment of new technologies (Carlos Rossell, PhD. and Oscar Braunbeck, PhD.) – phase II and phase III
  44. 44. OE3: Selection ofpotential suitable areas for sugarcane production in Brazil (Manoel Regis Leal, PhD.) – phase II and phase III
  45. 45. OE4: Infra-Structure: existing and need for improvement and expansion (Mirna Gaya Scandiffio, PhD.) – phase I and phase III
  46. 46. OE5: Assessment of socio-economic impacts (A.Scaramucci, PhD.) phase I and phase II
  47. 47. OE6: Construction of ethanol production scenarios and socio-economic impacts (André Tosi Furtado, PhD.)
  48. 48. OE7:Assessment of environmental impacts (M.Jannuzzi, PhD.) – phase II and phase III
  49. 49. OE8:Legislation and policies in different countries: producers and buyers (Manoel Sobral Jr., PhD.) – phase III</li></li></ul><li>Methodology for elaborating maps <br />Potential Areas - sugarcane production<br />Areas with<br />environmental restriction<br />Areas withslope <br />restriction<br />Soil Maps<br />Climate Map<br />Evaluation Criteria <br />(soils)<br />Criteria for Climate <br />Restriction<br />Production potencial <br />(soils)<br />Production potencial <br />(climate)<br />Soil/climate Potential <br />for sugarcane<br />Soil/climate Potential <br />with irrigation<br />
  50. 50. POTENTIAL FOR SUGAR CANE PRODUCTION:<br />SOIL AND CLIMATE - WITHOUTIRRIGATION<br />High<br />Average<br />Low (World average)<br />Inapropriate<br />Amazon Rainforest<br />Pantanal<br />Atlantic Forest<br />Other important preservation areas<br />Above 12% slope area<br />
  51. 51. POTENTIAL FOR SUGAR CANE PRODUCTION:<br />SOIL AND CLIMATE – WITH IRRIGATION<br />High<br />Average<br />Low (World average)<br />Inapropriate<br />Amazon Rainforest<br />Pantanal<br />Atlantic Forest<br />Other important preservation areas<br />Above 12% slope area<br />
  52. 52. Ethanol transport – Brazil 1980 and 2007<br />Pipelines and Hydro ways are the best way to transport Ethanol from the cost vs benefit point of view<br />
  53. 53. Ethanol Exports by 2025: 205.5 million of m3<br />Area=Prod. 106 m3<br />Clusters(c)<br />
  54. 54. Cost Comparision for Ethanol Production (1)<br />
  55. 55. Important Issues (cost reduction and improve sustainability)<br />Productivity gains<br />Otimization of agricultural operations<br />Gains in industrial efficiency<br />Reduction and recycling of effluents<br />Reduction of energy and water consumption<br />Otimization of use of other resources <br />Use of new technologies<br />
  56. 56. Expected Productivity Gains<br />
  57. 57. Impact of New Technologies<br />
  58. 58. Genetic improvement: conventional and genetic engineering<br />Precision agriculture<br />Raw cane harvesting with trash recovery<br />Pre-processing and storage of bagasse and trash<br />R&D Priority Areas: agriculture<br />
  59. 59. Improvements of fermentation, crushing and destilation<br />Reduction of vinasse production (per l of ethanol)<br />High Energy Cane (“energy cane”)<br />Hydrolysis of bagasse<br />Gaseification: EE and fuels (F-T)<br />R&D Priority Areas: industry<br />
  60. 60. R&D Priority Areas<br />Management<br />Automation (advanced system)<br />Infra-structure<br />Production Model (small x large)<br />Environment Licencing (methodology)<br />Certification<br />Alcoolchemistry and sucrochemistry<br />Other products<br />
  61. 61. Sugarcane Primary Energy<br />
  62. 62. Genetic Improvement<br />Optimized processing for ethanol production (convencional to advanced-hydrolysis)<br />Raw cane harvesting with trash recovery<br />Energy optimization<br />Sugarcane Research Challenges<br />
  63. 63. A análise em elaboração<br />organização de informação quantitativa que deverá identificar indicadores para um desenvolvimento sustentável da política de expansão da produção de etanol <br />Este estudo é baseado em dados de literatura e tem por objetivo quantificar a utilização de recursos críticos em todo o ciclo de produção e uso do etanol. Essa informação organizada através de indicadores poderá ser utilizada para a definição de “indicadores de sustentabilidade” para o etanol.<br />análise de riscos sócio-ambientais associados ao cenário de expansão da produção e das estratégias sugeridas pelo projeto nos relatórios anterior (Fase 2). <br />Essa etapa da análise inclui uma análise do tipo SWOT <br />processo consultivo tem a finalidade de auxiliar a identificação de alternativas de menor impacto sócio-ambiental e validação das conclusões.<br />Consulta aos aos especialistas envolvidos no projeto – Matriz de Impactos Ambientais<br />Análise multicritério<br />
  64. 64. vinhoto/água<br />Energia (bagaço)<br />CO2<br />Produção de cana<br />Produção de álcool<br />Escoamento<br />x ha<br />1 m3 etanol<br />y m3<br />z kg/ha fertilizantes/ defensivos<br />ΔCO2<br />particulados<br />ΔCO2<br />1 m3 etanol<br />x ha<br />
  65. 65. Análise SWOT<br />Strength, Weakness, Opportunity, Threat<br />Impactos na qualidade do ar<br />Suprimento e qualidade da água<br />Ocupação do solo e biodiversidade<br />Preservação dos solos agrícolas<br />Uso de defensivos agrícolas e fertilizantes<br />

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