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Encuentro Periodistas 2008: Ethanol and sustainability issues – The case of Brazil
 

Encuentro Periodistas 2008: Ethanol and sustainability issues – The case of Brazil

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Presentación de Thiago Romanelli de la Universidad de Sao Paulo en el Encuentro de Periodistas realizado en Sao Paulo- Brasil, en junio de 2008.

Presentación de Thiago Romanelli de la Universidad de Sao Paulo en el Encuentro de Periodistas realizado en Sao Paulo- Brasil, en junio de 2008.

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    Encuentro Periodistas 2008: Ethanol and sustainability issues – The case of Brazil Encuentro Periodistas 2008: Ethanol and sustainability issues – The case of Brazil Presentation Transcript

    • Ethanol and sustainability issues – The case of Brazil and new opportunities for innovation and development Thiago Romanelli, Dr Dept of Rural Engineering College of Agriculture “Luiz de Queiroz” University of Sao Paulo Sao Paulo– June 18, 2008 0
    • Brazilian Center for Biofuels`s background 1
    • Brazilian Center for Biofuels at the University of Sao Paulo – School of Agronomy – Sao Paulo State 2
    • The roles and functions of the Brazilian Center for Biofuels: “ A Think Tank” @ the University of Sao Paulo Contribution to: •Strategic and applied research • S&T&I supporting and influencing policies •Awareness raising and capacity building •Mitigation of GHGs and carbon projects 3
    • Key biofuels drivers Global and larger frameworks supporting biofuels deployment Oil consumption and prices: a security issue IPCCC and Stern report – environmental and economic impacts of GHGs USA – goals of reducing 10% gasoline consumption in 20 years EU – Directives on Biofuels 2003/30/EC & Biofuels Vision 2030 Kyoto targets and voluntary commitments Cost effective substitution and future technologies available…. Competitive prices and being renewable 4
    • Some remarks... Energy intensity economies – developed versus developing countries Asymmetric impacts of GHGs in countries – the poor will suffer the most Livelihoods ... trends in consumption patterns and cultural behavior The role of renewable energy sources Technologies and biofuels: competitiveness and innovation 5
    • Biofuels framework - understanding key drivers of energy supply and demand System dynamics and their multiple interactions Global + + + Gasoline/Diesel awareness Climate GHGs Querosene - Oil reserves change - Hydro + Environmental Nuclear taxes & - + + policies Energy Energy + Wind demand supply Land use Native - patterns vegetation + Hydrogen + and forests + - Trends in - + + + + consumption + Quality of Ethanol - + life & biodiesel Food and + livelihoods + Economic + Jobs growth + + Food Quality of safety Roles and jobs functions of government, private sector and + NGOs Biodiversity Diversification 6
    • BIOFUELS MARKET Brazil is well positioned in terms of economy, size and potential Key indicators of the BRIC countries 1) GDP/cap GDP (billion) Area Agribus (M ha) Pop Poverty HDI PPP US$ PPP US$ (M KM2) Areable Potential (million) % pop US 41.399 42.101 12.427 12.485 9,20 173 280 13% 0,94 China 7.204 1.703 9.412 2.225 9,60 142 1.300 10% 0,76 India 3.344 714 3.633 775 3,30 160 1.050 25% 0,60 Brazil 8.584 4.316 1.577 792 8,50 59 360 180 22% 0,79 Russia 11.041 5.369 1.576 766 17,10 123 150 25% 0,80 Average 5th in area but Average Human Brazil’s 9thlargest with greatest developing Development positioning country economy agricultural Index potential 1) The poverty line set by the Chinese government is approximately 1/13th the standard set by the World Bank. China’s poverty line of 0.2 US$ /person daily should be reevaluated. If a daily standard of 0.3 US$ were set the number below poverty standard would triple Source: IMF 2005 7
    • Brazil - the energy matrix & the role of renewable sources 100% Non-renewable 94% 87% Renewable 80% 60% 56% 45% 40% 20% 13% 6% 0% Brazil (2006) World (2004) OECD (2004) 8
    • The role of sugar cane in the energy matrix Other Biomass Sugar Cane 12,4% 14.6% Hydroelectricity 14,8% Other Renewables 3.0% Uranium 1,6% Coal Petroleum and 6,0% Derivatives Natural Gas 37.9% 9,6% 9
    • Sugar cane value chain 6,5 million ha Harvest 390 mills & distilleries 73 thousand growers 410 million tons (Operation & projects) ETHANOL SUGAR BAGASSE 22 billion liters 28 million tons Bioplastic Ethanol Derived Credits of Food Carbon Lysine Pharmacy 10
    • BIOFUELS MARKET Total production of sugarcane in Brazil increased significantly with the deployment of the ethanol vehicles The evolution of the Brazilian ethanol industry – M tons of processed sugarcane Flex fuel car sector boom Release the prices Stagnation of the sector of ethanol Change the mix of production Last strategic Ethanol car from ethanol to sugar plan to the increase of sector: demand Próalcool Source: Datagro 11
    • FLEX Flex fuel cars account for more than 80% of total cars produced in Brazil Evolution of light vehicles production and Total Brazilian Fleet – ‘000 vehicles Brazilian Fleet (2007) 21,425 Gasoline 14,797 80% FFV 2,752 Ethanol 1,446 CNG 1,385 Diesel 1,045 Source: ANFAVEA; VPB estimates 12
    • Mitigation measures due to biofuels Emissões Efetivas e Evitadas no Transporte 50 Substit. Álcoo hidrtado 45 Substit. Álcoo anidro 40 Tg ou milhão de t de Carbono Substituição GN/Gasolina 35 Substituição 30 Diesel/Gasolina QUEROS. AVIACAO 25 GAS NATU RAL 20 GASOLINA 15 OLEO DIESEL 10 CARVÃO MINERAL 5 OLEO COMBUST. 0 1970 1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 13
    • PRÓ-ALCOOL Ethanol productivity – liters/ha growing at 2,8%/year in the last 30 years Fonte: Itaú Corretora 14
    • PRÓ-ALCOOL Brazilian sugar-cane productivity is 11% higher and has increased more than twice the world productivity Agricultural productivity – M tons/ha Brazilian productivity World average productivity Source: Petrobrás 15
    • BIOFUELS MARKET Sugarcane is the most energy efficient raw material to produce ethanol Energy balance of ethanol production from different feedstocks 12 Energy out put input ratio 10 8 6 4 2 0 Sugarcane Subar beet Wheat straw Corn Wood Production /ha Quantity of Energy Output/ Raw material (kg) Ethanol /ha Energy Input • sugarcane • 85.000 • 7.080 liter • 8.3 • Corn • 10.000 • 4.000 liter • 1.3 - 1.8 Source: Petrobrás, Coehlo/Cenbio 16
    • ENERGY EFFICIENCY Serra et al. (1979)
    • 3m 2m Energy factory – 1m 1 ton of cane is equivalent of ... Sugar Cane in Brazil • 1/3 sugar – 145 kg 0m 1/3 fibre – 140 kg 1/3 leaves and tops – 140kg First generation 1m • 1ha = 9.000 l ethanol - 65 b of oil • 6.5 MM ha of sugar cane – 2m Uptake/year = 25,8 M tons of CO2 equivalent 3m 4m 18
    • Sugar allometric patterns and challenges 19
    • Transgenics: agriculture technology and current genetic materials Candidate genes and traits: the roles for GM sugar cane •Water deficit •Max. productivity potential – with irrigation •Longer management cycles •Sugar versus fiber content: new allometric models 20
    • 21
    • 22
    • VANTAGENS Some estimates say Brazil has about 263 million ha of available land for sugar cane. It is the largest land availability in the world. Low productivity pastures for cattle takes over most of the available land. Available land in Brazil Type Area (Mha) • Total country 851 • Native Amazon Forest 370 • Secondary Amazon Forest and Others 180 • Native Forests 6 • Pasture 197 • Temporary Crops 58 • Permanent Crops 8 • Available land 263 • Available land with low impact1) 90 Source: FAO, 2002, Emprapa 23
    • ...without having to displace food production, as seen in recent years. Brazilian Main Cropped Areas (MM Ha) CAGR 2001-2006 Cattle (MM) 209 Cattle 3,5% 205 207 196 185 2,8 2,4 Wheat 6,7% 176 2,5 3,9 3,0 Rice -1,5% 2,5 3,7 4,2 1,7% 3,2 3,9 Bean 2,1 4,3 1,7 3,2 4,4 6,6 5,8% 3,2 5,8 Sugarcane 4,3 5,6 3,9 5,4 5,2 5,0 12,2 13,0 Corn 0,0% 12,8 13,2 12,3 13,0 21,4 23,3 22,7 Soybean 10,2% 16,3 18,5 14,0 2001 2002 2003 2004 2005 2006 Source: MAPA; CONAB 24
    • Footprint and productivity explain the sugarcane promise as a 2nd Gen biofuels feedstock in Brazil. Crop Occupied Area (2007) Production and Productivity per Crop (2007) 17% 500 80 450 74,7 70 2% 34% 400 3% 60 350 78% 22% 3% 300 50 4% 250 40 5% 200 30 Pasture Harvesting Area 150 22,3 14 14,1 20 11% 100 22% 50 10 2,7 3,7 3,7 2 3,4 0,9 0,9 Soy Corn Sugarcane 0 0 offee orn ane Bean ice otton range Banana Soy anioc thers heat Rice Coffee Manioc R C S.C W heat Cotton Others W C O C M O Total Occupied Area (Harvesting + Pasture): 270MM ha Production (MM tons) Productivity (ton/ha) Theoretical Cellulosic Ethanol Yield by Dry Feedstock Unlike 1st generation ethanol, cellulosic ethanol 113 112 110 yield does not vary significantly between Gallons/tonne feedstocks in terms of gallons / ton. Therefore, 57 the determining factor of end yield will be ton / hectare of biomass for each feedstock, giving sugarcane an advantage over other crops. Corn Stover Bagasse Rice Straw Cotton Gin Trash Source: CONAB; IBGE; IEA 25
    • Sugarcane producing regions in Brazil Sources: NIPE-Unicamp, IBGE and CTC 26
    • An land use approach: the supply side FOOD ENERGY FOOD BIOENERGY FORESTS • INTERNATIONAL AND NATIONAL DEMANDS: food & fuel • SUSTAINABLE USE OF LAND AND LANDSCAPES • ADDED VALUE OF BIOENERGY MATERIALS • INTEGRATION OF AGRICULTURE/FORESTS • DIVERSIFYING THE PORTFOLIO OF FARMER´S OPTIONS 27
    • DESMATAMENTO BRAZIL: 300 AGRICULTURE VS. PASTURE AREAS 250 h c r sm n e ta e illio 200 Pastures (natural) 150 100 Pastures (planted) 50 Others Corn Soybeans 0 Sugarcane 1940 1950 1960 1970 1975 1980 1985 1996 Values for the year 2005 Number of Pasture areas Average density bovine animals (million hectares) (heads/hectare) If the average density in Brazil was 1.4 If the average density in Brazil was 1.4 (million heads) head/hectare head/hectare 50-70 million hectares of pasture could 50-70 million hectares of pasture could Brasil 207.1 200-220 ≈ 1.0 be used for agriculture be used for agriculture São Paulo 14.1 10 ≈ 1.4 Source: Brazilian bovine flock IBGE. Pesquisa agropecuária municipal. Accessed 12/09/2007; Bovine flock and pasture areas in São Paulo Amaral, A.M.P. et al. Animal production estimates in the São Paulo state for 2006. Economic ionformation. São Paulo: Instituto de Economia Agrícola, v.37, n.4, p.91-104, abr.2007. 28
    • Technologies for biomass conversion – 2nd generation of biofuels 29
    • Second generation and feedstocks Other feedstocks for ethanol second generation Source of Proprieties (%) feedstock Area Production Produtivity Potential [000 ha] [000 t/year] [t/ha.year] lignin celullose hemicelullose Cane Straw 6,600 72,600 9 a 13 26 37 28 High Bagasse 6,600 72,600 9 a 13 20 41 25 High Corn stover 11,549 64,029 5a8 15 30 a 45 50 a 35 Medium Soybean stover 22,933 80,747 3a4 15 a 25 30 a 40 25 a 35 Medium Rice stover 3,919 2,937 4a6 23 a 35 36 a 40 - Medium Eucalyptus residues 4,000 94,600 22 a 24 20 45 30 High Pine residues 2,000 38,700 18 a 20 28 42 27 Medium Pastures 115,000 460,000 3a5 10 a 30 25 a 40 35 a 50 Low Fonte: McMillan, 1994; Wood for Alcohol Fuels, 2002; Saad, 2005; IBGE; CONAB; SBS 30
    • From resources to markets – opportunities 31
    • Biotechnology frameworks for supporting the full deployment of bioenergy and biofuels Biotechnology is supporting the deployment of bioenergy and biofuels production in four main interconnected areas Biomass Biomass conversion production technologies Bioenergy & Biofuels Other associated Environmental technologies process, i.e. co-products… Just the production of biofuels at competitive costs is not sufficient now …beyond yield We need to understand biofuels externalities and energy balances 32
    • Policies and enabling environment Sectoral policies affecting ethanol •Energy •Transport •Agriculture •Environment •Conservation of biodiversity •Economics •etc 33
    • Bioelectricity forecast from sugar cane and possible competition for bagasse in the near future – opportunity costs 10,1 10 bagasse (75%) bagasse (75%) + straw (50%) 8 7,2 1000 ave.MW 6 5,3 5,2 4,2 4 3,4 2 0 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 34
    • CERTIFICACAO Biofuels Certification – “The Babel of Certifications” EU Directives European Union Ethanol Biofuels Certification Meó Consulting Team German Government PBCB Brazilian Biofuels Program Sustainable Production of Biomass Cramer Commission Certification Dutch Government Brazilian Goverment RTFO Renewable Transport Fuel Obligation UK Government Several certification initiatives are under RTSB Round Table on Sustainable Biofuels discussion now Switzerland National Certifications How to attend to all SEKAB, GREENERGY Sweden, United Kingdom certification discussions? 35
    • Collaboration on C&I - Certification Some issues to consider.... 36
    • Brazilian frameworks supporting S&T&I in biofuels • Good examples from Pro-Alcool - ca. US$ 2 billion – 30 years •Federal level - Ministry of Science & Technology - Agencies – CNPq and FINEP Ministry of Education - CAPES • State level – SP - the case of FAPESP •Innovation law in BR – being implemented – facilitate interactions between academia and private sector 37
    • Players and investments in sugarcane & ethanol R&D in Brazil. More than 15 universities, 14 research centers and 150 researchers focus on biofuels in only one initiative (Bioetanol project) Crops and biofuels Only in CTC (sugarcane technology center) more than 300 people work in R&D activities R&D initiatives and Efforts are made to share knowledge between universities and research centers (ex: Bioetanol project, experience conferences) International participation in R&D initiatives (Bioethanol Project, Oxiteno, Votorantim) Country is a world leader in the production of sugarcane plants capital goods (ex: Dedini) Innovation and Productivity improvements through sugarcane genetic modifications, from 55 tons/ha in 1970 to 75 scientific tons/ha in 2006 achievement on Almost 300 sugarcane varieties developed by CTC biofuels feedstocks Almost 80% of investments in biofuels in Brazil come from the private sector In 2005 MCT (Science and Technology Ministry) invested US$840 MM in R&D, 21% of which went to agriculture-related research (US$176MM) Investments in R&D US$105 MM to be invested between 2003 and 2008 in agroenergy by MCT Votorantim invested US$ 40 MM in biotechnology in the last 4 years developing 15 transgenic sugarcane varieties 38
    • Biofuels framework for innovation Academia Private Government Universities Innovation centers Agencies Foundations R&D Incubators •Advisors Innovation agencies Tech parks •Partners’ networks •Media •Business partners •Seminars Business Brazil pipeline •International partners International exchange 39
    • Biofuels Technology Park @ Piracicaba, SP 40
    • City Biofuels Technology Park 3 km ESALQ The Park
    • 42
    • Concluding remarks - Four pillars on ethanol competitiveness 1/2 •Need for a global market for biofuels •Improving the logistics •Planning the sugar cane expansion sustainably •Innovation 43
    • Deploying the global opportunities – can´t afford not to have… 2/2 Concentration and concerted efforts: focus and scale Continuity: 30 years of investments worthwhile – the Brazil case Complementarity: bioenergy sources and expertise – need for an interdisciplinary approach Commitment: to make a change Coordination 44