Brazil opens first hybrid ethanol-biodiesel plant

Brazil's recently reelected president Luiz Inacio Lula da Silva showcased his country's prowess in the biofuels industry today when he opened Barralcool, the world's first integrated biofuels plant that will produce cane-based ethanol and biodiesel from oilseeds in a highly efficient and streamlied process.

Brazil, with its huge agricultural potential, has for decades had the world's most advanced biofuels market. After the oil crisis in the early 1970s, it launched the ProAlcool ethanol programme to lighten dependence on crude imports. Now that this program has become a major success, the country is embarking on the development of an innovative biodiesel program (ProBiodiesel) in which poverty alleviation and rural development take center stage.

The Barralcool plant is located in the city of Barra do Bugres, in the interior of Mato Grosso state, one of Brazil's poorest regions. Mato Grosso has been producing ethanol from surrounding cane fields for over 20 years, bringing employment to thousands. The 27 million reais (€9.6/$12.5 million) integrated biodiesel plant, built by Dedini, will prodive many more jobs, and has the following capacities [*.Portuguese]:

• an ethanol to biodiesel production ratio of roughly 3 to 1, with the production of 150 million liters of sugarcane based ethanol, 57 million liters of sunflower and soybean based biodiesel and 40,000 tonnes of raw sugar per annum
• the amount of energy contained in the liquid fuels that will leave the factory each year is around 900,000 barrels of oil equivalent
• the plant will co-generate electricity and steam to power its own operations, and feed excesses into the national grid
• besides producing separate biofuels, the plant will also mix ethanol and biodiesel in new formulations; recently, 1700 buses in São Paulo have started utilizing such blends and several trials are underway to find suitable blends for different engine technologies
  
• in a first phase, the project will involve the cooperation of 14 municipalities and will bring new jobs to 600 rural families

Hyper-efficiency
Commenting on the benefits of the integrated plant, Ronaldo Knack, president of consultants BrasilAgro, which will host the International Agroenergy and Biofuel Fair in Brasilia on November 27-29, says: "Having the two plants together will provide major infrastructure and energy savings." Brazil's sugarcane ethanol already has a very positive energy balance (of around 8 to 1, with some producers achieving a balance of 11 to 1) and analysts expect this balance to become even stronger in the near future due to technological advances, equalling or even surpassing the energy balance of conventional petroleum production (earlier post). The highly efficient integrated plant is a first demonstration of the fact that these projections are not too far-fetched:
biomass :: bioenergy :: biofuels :: energy :: sustainability :: social development :: Mato Grosso :: oil independence :: ethanol :: biodiesel :: Brazil ::


According to Paulo Gaiad, operations manager at Dedini, Brazil's leading provider of sugar-ethanol, biodiesel and cogeneration plants in Brazil, there are currently some 300 sugar-ethanol mills in operation in Brazil and another 60 under construction.

But despite the ethanol success story - based on rising demand for biofuels, as consumers worry about global warming and instability in oil exporting countries - Brazil's oilseed sector is in its worst crisis in decades due to the strong real against the dollar and high production costs. Multinationals such as Archer Daniels Midland and Bunge have closed several soy crushing plants in the past year or so.

Towards full oil independence
With the advent of the ProBiodiesel program "the worst of this crisis is now over," President Lula told hundreds of onlookers at the inauguration of the Barralcool plant. Analysts like BrasilAgro estimate that Brazil will invest over US$15 billion in bioenergy in the next five to six years:

The Lula government recently passed legislation that will mandate a 2 per cent blend of biodiesel from oilseed crops like soybean, sunflower or castor bean in all commercial sales of petroleum diesel by 2008 and 5 per cent by 2013. A few hundred filling stations already blend it. Brazil has about 14 biodiesel plants in operation and another 40 or so in construction, according to consultants Enerbio.

Now, about half of Brazil's massive cane crop has gone to ethanol production with the rest being refined into sugar. The more recent spike in world oil prices has turned an already thriving industry into a gold mine. Today, motorists can choose to fill up with 100 per cent ethanol at half the price of petrol at over 30,000 filling stations nationwide or opt for petrol which is blended with 20-25 per cent ethanol. Ethanol accounts for 40 per cent of all non-diesel fuel consumption and its market share is growing.

President Lula stresses that both the ethanol and biodiesel strategies of Brazil are not only directed at local consumption, but that the growing international market for biofuels must be an equally important target. Because Brazilian plants can switch between producing liquid fuels or sugar/crushed oilseeds, the country can now play on four markets at the same time, allowing great strategic flexibility and planning: (1) the (inter)national sugar market, (2) the (inter)national oilseeds and oilseed meal market, (3) the international ethanol market, (4) the international biodiesel market. This flexibility is now available at the very level of the integrated biofuel factories of the future, of which the Barralcool plant is a first example.

Lula insisted also that "with the advent of the production of biodiesel, we [with Petrobras] are now genuinely en route towards full oil independence".

More information:
Primeira Hora: Biodiesel será um dos pilares da economia mato-grossense, diz Maggi - 22 Nov. 2006
Noticias da Hora: Primeira usina integrada de biodiesel e álcool é inaugurada no Mato Grosso - 22 Nov. 2006
Diario News: Biodiesel é uma das revoluções de um Brasil maduro e soberano, diz presidente - 22 Nov. 2006