Biofuels in Brazil
by Antonio Maria Bonomi, Paulo Barbosa and Susan van Dyk (IEA Bioenergy Task 39 Newsletter #37) Brazil was the leader in biofuels production and exports until the USA became the world’s largest biofuel producer in 2006 and the leading exporter of biofuels in 2011. Brazilian ethanol from sugarcane is considered the most sustainable biofuel commercialized to date, providing 61% or greater reduction in total life cycle GHG emissions compared to gasoline. Brazilian sugarcane ethanol is considered as an advanced biofuel by the US EPA. (Ref1) With over 30 years of development, the Brazilian ethanol industry continues to serve as a model for sustainable bioethanol production from sugarcane.
Historical development of Brazilian biofuels – Proalcool and flex-fuel vehicles
Widespread development of biofuels came in response to the first oil crisis in the 1970s as a means to increase
energy security and save foreign currency on petroleum purchases. The National Ethanol Programme, Proálcool, was launched at this time and several policies were introduced to promote bioethanol production and consumption,
including the development of vehicles capable of utilizing hydrous (E100) fuels. Flex-fuel vehicles, capable of
running on any mixture of gasoline and hydrated ethanol, were introduced in 2003 and currently about 60% of all
vehicles in Brazil are flex-fuel, with 90% of new light vehicle sales being flex-fuel vehicles (Ref2). The Brazilian
government promotes the sales of flex-fuel vehicles by having lower taxes and preferential interest rates on the
purchase of flex-fuel vehicles (USDA Biofuels Annual, 2013).
In February 2014, POET also announced plans for a corn-based ethanol facility in Mato Grosso do Sul, Brazil, which
will produce 50 million liters per year. This facility will be constructed as a joint venture between POET and BioUrja
Trading LLC. POET eventually plans to expand this model to a total of four facilities (Ref8).
Amyris’s industrial-scale farnesene (Biofene) plant began commercial production in early 2013. It is located in
Brotas, São Paulo state, in the southeastern region of Brazil. Amyris uses a proprietary microorganism to convert
sugar feedstocks to farnesene, which can be hydroprocessed into aviation fuel, farnesane.
Two cellulosic ethanol facilities of 40 million liters per year each are currently planned by Petrobras Biofuel and
GranBio was the first company to announce plans to construct a commercial cellulosic (second-generation) ethanol
plant in the Southern Hemisphere in collaboration with Italy’s Chemtex, to be based on Chemtex’s Proesa
In May 2014, Solazyme, a renewable oil and bioproducts company, announced that its joint venture with Bunge
Global Innovation LLC (“Bunge”), a wholly-owned subsidiary of Bunge Limited, had successfully produced its first
commercially saleable products at full-scale production at the Solazyme Bunge Renewable Oils plant in Brazil.
Funding is provided through the Brazilian state-development bank, Banco Nacional de Desenvolvimento Economico e Social (BNDES). …
In March 2014, it was announced that BNDESPAR, the investment arm of BNDES, will invest up to R$ 300 million in the sugarcane technology center (Centro de Tecnologia Canavieira S.A. – CTC) by underwriting new shares to be
issued by the company. The resources will make up funding to develop new projects for CTC’s business plan, a
Brazilian company involved in research and development for sugarcane sector technologies.
Areas of focus will be:
Mechanization for planting and harvesting
Trash (a.k.a. field residues) recovery technologies
Vinasse fertirrigation technologies
Advanced cogeneration systems (e.g. BIG-GT)
Fermentation yield and productivity
Biorefineries – biochemical and thermochemical routes (pretreatment operation, pentose utilization,
enzymatic hydrolysis, integration with 1G, pyrolysis, gasification, syngas utilization, others)
Drop-in biofuels (including bio-jet fuels)
Oil transesterification using ethanol
Brazil is also exploring the potential of microalgae to contribute to advanced ethanol and biodiesel market shares.
Current challenges for the biofuels industry
There are several challenges facing the biofuels industry in Brazil at present. The Brazilian government controls
gasoline prices and slashed taxes on gasoline to control inflation. As a result, on an energy basis gasoline is cheaper
than ethanol in many regions of the country. Nevertheless, flex fuel car owners continue to buy available ethanol.
This has had an impact on Petrobras, the national oil company, as they have to import oil and sell gasoline at a loss.
Increasing the ethanol blending mandate to 27.5%, as now proposed, will go some way towards alleviating this
financial situation for Petrobras, however this increase is unlikely to take place until 2015.
An increase in domestic sources of oil is taking place with the expansion of oil exploration and drilling in the Atlantic
and the discovery of large pre-salt oil reserves off the coast, and this is likely to affect ethanol production (Ref18).
Sugarcane harvest yields have been reduced over the last few years due to low sugarcane productivity as a result of:
long periods of drought;
a lack of required investment in sugarcane reforming back in 2008;
mechanization of the harvest which has led to soil compaction; and
phase-out of pre-harvest burning which has resulted in an increase in pests. READ MORE