Main issues and future prospects for Brazil

3. DOMESTIC ENERGY RESOURCES

3.5. Main issues and future prospects for Brazil

As has been shown in this chapter, Brazil has extensive natural energy resources, both renewable and non-renewable, although oil and natural gas are relatively limited given the current and expected future demand for these resources.

Brazil is unique in the sense that renewable energy already makes a major contribution to the primary energy portfolio (around 40% in 2001), and its contribution could be increased significantly by 2025. Within this context, one of the most promising alternatives is biomass energy, particularly from residues (bagasse and forestry) and plantations, which already make a significant contribution. The possibility of cofiring of biomass, particularly with coal and natural gas, should be considered. This technology is advancing rapidly at the global level, although not in Brazil. It is one of the most promising alternatives to large scale utilization of biomass. This technology has not yet caught the attention of utilities operating in Brazil

Hydropower, which today is responsible for more than 80% of Brazil’s electricity generation, still has room to grow. New hydropower plants are planned or are already under construction, including very large units. The prospects for further expansion remain good, although less so for the large units. Environmental, social and economic barriers will probably limit future hydropower installations to medium sized and small units.

Due to its favourable geographical situation, Brazil has a very large solar energy potential, but the country is technologically behind the leading countries; at the same time, the installed capacity remains quite low. It seems that the development of such potential will be largely dependent on techno-logical advances in the international market.

The potential for wind power is also large, but there is still considerable disagreement regarding its actual potential contribution to the energy matrix

owing to the lack of reliable data. However, favourable Government policies combined with rapidly falling costs of wind power around the world make this option an attractive one. With support from international capital, wind energy can play a significant role in Brazil within a decade, particu-larly in the Northeast.

A clear policy in support of renewable energy and energy sustainability is needed. Efforts like PROINFA are extremely useful, but they cannot yet guarantee successful and continuous expansion of renewables. More studies are necessary to motivate decision makers to become aware of the large potential of new and renewable sources of energy.

Nuclear energy is the subject of continual political discussion, but progress has been slow and there is no reason to expect different behaviour in the next two decades. Fundamental changes in policy and social attitudes will be required if nuclear is to play a larger role in Brazil’s sustainable energy matrix.

In summary, resource availability is not the real limitation to a sustainable energy future; rather, it is the increasing societal demand for environmen-tally sustainable fuels at affordable costs, whether or not the energy sources are renewable. Current socioeconomic development, demanding ever increasing amounts of finite energy resources, is not sustainable, and thus maintaining the present energy intensity and energy portfolio is not the answer. It is clear that considerably more products can be manufactured using far less energy, and that there are other sustainable energy alternatives that are socially and environmentally more acceptable.

Such alternatives need to be pursued more vigorously if a more sustainable path is to be achieved.

Brazil is very fortunate because its resource base is large enough to allow considerable energy flexibility and thus is less vulnerable to international fluctuations, although in an increasingly global market there will always be a strong international interdependence. This interdependence is not limited simply to energy, but also encompasses trade, politics, technology, economics and finances.

During the preparation of this report, it became clear that there are limitations with respect to energy planning activities that need to be addressed, in particular the quantity and quality of energy related data. The availability of long term, consistent, reliable data is a fundamental prerequisite for sound decision making. There are

various areas in Brazil where availability of information is particularly limited, including the following:

●Biomass energy: Brazil is a major consumer and has one of the world’s greatest biomass potentials. With the exception of sugar cane, there is a considerable lack of consistent, reliable and up to date data on a nationwide scale about biomass’s potential as an energy source. This is particularly the case with regard to residues, which Brazil produces in large quantities. Despite the difficulties, it is hoped that The Brazilian Atlas of Biomass Energy¹⁸ will eventually become a truly effective source of information about biomass energy resources in Brazil.

●Solar thermal/PV: More and better data on the potential uses of these sources and better coordination among players are still required.

●Wind: The Atlas of Wind Power [3.32] is in the process of being updated, which hopefully will facilitate the assessment of the potential growth of wind energy in Brazil; so far there are large discrepancies with regard to estimates of the real potential of this energy source.

REFERENCES

[3.1] MME (MINISTRY OF MINES AND

ENERGY), Balanço Energético Nacional, MME, Brasilia (2004), www.mme.gov.br/site/menu/

select_main_menu_item.do?channelId=

1432&pageId=1589

[3.2] MME (MINISTRY OF MINES AND

ENERGY), Balanço Energético Nacional, MME, Brasilia (2002).

[3.3] USGS (UNITED STATES GEOLOGICAL SURVEY), World Petroleum Assessment 2000, The USGS World Energy Assessment Team, 21 February, USGS, Reston, VA (2001).

[3.4] ANP (NATIONAL PETROLEUM AGENCY), Anuario Estatístico Brasileiro do Petroleo e do Gas Natural 2002, ANP, Rio de Janeiro (2004).

[3.5] BP (BRITISH PETROLEUM), BP Global — Statistical Review of World Energy, June 2001, BP, London (2002).

18 The Brazilian Atlas of Biomass Energy has been developed by CENBIO [3.36]. However, given the nature of biomass, considerably more resources are needed to develop a truly nationwide representative biomass atlas.

Chapter 4 INDIGENOUS AND ADAPTED ENERGY TECHNOLOGIES AND ENERGY EFFICIENCY

S.T. COELHO, A. WALTER

Brazil has significant experience in the development and use of innovative technologies.

This chapter presents and discusses general aspects of indigenous and adapted energy technologies in Brazil and analyses of energy efficiencies of selected technologies.

The most important technologies include sugar cane production and conversion to ethanol, hydropower, electricity transmission and offshore oil production.

4.1. SUPPLY TECHNOLOGIES 4.1.1. Sugar cane conversion

Brazil has long been one of the largest sugar cane producers in the world, but large scale ethanol production began only in 1975, when the Brazilian Alcohol Programme, PROALCOOL, was created with the goal of partially replacing gasoline in light transport. At that time, the country was heavily dependent on imported oil, and gasoline was the main oil derivative consumed.

For years, PROALCOOL has been the largest commercial biomass to energy system in the world.

Despite some difficulties, the programme has succeeded regarding its primary goals, namely, the reduction of oil imports, the stabilization of the sugar market, the enhancement of Brazil’s competi-tiveness in the sugar market and the creation of almost one million jobs as of 2002.¹

Among its results, those related to the environment and sustainability — such as reduced deterioration of air quality in large cities and a substantial reduction of greenhouse gas (GHG) emissions — are important and should be highlighted.²These results were possible because of the technological developments achieved in both

sugar cane and ethanol production. As a result of these developments, Brazil now sets the benchmark for ethanol production from sugar cane, and Brazilian industry is now highly competitive regarding equipment and services. The sections that follow present the main developments in the agricultural and industrial sectors.

4.1.1.1. Technology development in sugar cane production

Regarding ethanol production, 60–70% of the final cost of the product is the cost of the raw material itself — that is, the sugar cane. Thus, as far as economic competitiveness with gasoline is concerned, most of the cost reduction results have been achieved in the agricultural phase [4.1].

Agricultural yield and the amount of sucrose in the plant have a strong impact on the cost of sugar cane products. Agricultural yield is a function of soil quality, weather conditions and agricultural practices, and is also strongly influenced by agricultural management (e.g. the timing of planting and harvesting, and the choice of sugar cane varieties). By 1998, the average productivity in Brazil was around 65 t/ha [4.2], but it ran as high as 100–110 t/ha in São Paulo State [4.3]. Since the beginning of PROALCOOL, yields have grown about 33% in São Paulo State with the development of new species and the improvement of agricultural practices.

The development of sugar cane varieties aimed at increasing the sugar content in the sugar cane (expressed by the total reducing sugars (TRS) index³), developing disease resistant species, adapting to different soils and extending the crushing season [4.4]. As a result of this research and development (R&D) effort, the TRS index of sugar cane in Brazil has almost doubled since PROALCOOL began [4.2, 4.5].

1 This issue is discussed further in Chapters 7 and 9.

2 See Chapter 6 for a discussion of the environ-mental and health aspects of Brazil’s energy system.

3 The TRS impacts sugar and alcohol production and thus is considered in the sugar cane cost.

Many of the results achieved in sugar cane agriculture are due to the introduction of machinery for soil preparation and conservation. Many operations have been mechanized over the past 20–25 years, but advances in harvesting are more recent. In the past five years in the Midwest, Southeast and South regions, about 35% of the area planted with sugar cane has been harvested mechanically, and about 20% has been harvested without previously burning the field.⁴ Because of the lower costs associated with mechanized harvesting, in some regions up to 90% of the sugar cane is harvested mechanically. It is estimated that mechanized harvesting would allow a significant cost reduction per tonne of sugar cane [4.3].

Green cane harvesting requires the devel-opment of appropriate machines, taking into consideration the local topography and the way the sugar cane is planted. This development is necessary to ensure high performance in sugar cane recovery, lower costs, reductions in the amount of soil left on the sugar cane that is transported and low levels of sugar losses [4.4]. A number of appropriate harvesting machines have been developed in Brazil.

One of the main projects in this area has been undertaken by COPERSUCAR with the support of the Global Environment Fund (GEF), aimed at identifying the best techniques for green cane harvesting and potential uses of the recovered biomass.

Gains in productivity and cost reductions have also been achieved with the introduction of operations research techniques in agricultural management and the use of satellite images for identifying varieties in planting areas. Similar tools have been used in decision making regarding harvesting, planting and application rates for herbicides and fertilizers.

4.1.1.2. Technology development in ethanol production

Throughout the evolution of PROALCOOL, different priorities have been defined regarding technological improvements in the industrial process of ethanol production [4.6]. Initially, the

focus was on increasing equipment productivity. As a consequence, the size of Brazilian mills also increased, and some mills now have a crushing capacity of 6 Mt of sugar cane per year. The focus was then shifted to improvements in conversion efficiencies, an effort that continues today.⁵ During the past 15 years, the primary focus has been on better management of the processing units.

Altogether, since the mid-1980s the conversion efficiency of the industry has increased from 73 to 85 L, or from 1.6 to 1.9 GJ,⁶ of ethanol per tonne of sugar cane processed.

A summary of the main technological improvements in the industrial process is presented in Table 4.1.

Environmental issues should be the focus of further improvements in the industrial process. For instance, water consumption is still quite high — on average 5 m³ of water per tonne of sugar cane processed, with most values in the range of 0.7–20 m³/t [4.7]. Finally, it is worth mentioning that reducing steam consumption to 350 kg per tonne of sugar cane processed, or even less, is necessary to allow for better use of the power cogeneration potential. Steam consumption in Brazilian mills is typically in the range of 450–550 kg per tonne of crushed sugar cane.

As a result of the technological developments achieved in both agriculture and industry, average production yields have grown from 3900 L/ha/year (87 GJ/ha/year) in the early 1980s to 5600 L/ha/year (125 GJ/ha/year) in the late 1990s. In the most efficient units, this parameter can be as high as 8000 L/ha/year (180 GJ/ha/year) [4.8]. Table 4.2 shows the production of alcohol distilleries grouped by State and region for the 2001–2002 season.

The consequence of such technological devel-opments is that production costs have fallen remarkably since PROALCOOL began, as discussed below.

4 Sugar cane is usually burned in the field to allow higher throughput in both manual and mechanized harvesting. The burning process is fast and almost entirely eliminates the leaves and tops of the plant to allow manual harvesting.

5 On average, the conversion efficiency (e.g. litres of ethanol per tonne of sugar cane) rose about 1% per year between 1985 and 1996.

6 This value is based on the lower heating value (LHV) of anhydrous ethanol. Considering hydrated ethanol production, the range would be the same if the conversion efficiency were expressed as litres per tonne of sugar cane, but 5% lower on an energy basis; the LHV of anhydrous ethanol is 22.3 MJ/L and the LHV of hydrated ethanol is 21.3 MJ/L.

4.1.1.3. Cost reductions

Since PROALCOOL began, ethanol production costs have fallen 3.2% per year in the Midwest, Southeast and South regions and about 1.9% per year in the North and Northeast regions [4.10]. It was estimated that in 2001 production costs in a mill with good performance were around 0.45 Brazilian reals per litre [4.11], or about US $0.18/L.⁷ However, by the end of 2003 production costs were estimated at just US $0.16/L, or US $7.2/GJ. The large scale use of existing technologies would allow an average reduction of production costs of about 13% over the next 5–6 years, resulting in costs of about US $0.14/L. At the beginning of 2002, it was estimated that the production of hydrated ethanol in the most efficient Brazilian mills would be competitive with gasoline for oil prices of about US $25/bbl — or about one fourth of the cost during the initial stages of PROALCOOL [4.7].

Figure 4.1 shows the ethanol learning curve from 1980 to 2005 [4.1]. The curve is based on prices paid to producers, which are a good indication of the production cost trend. The progress ratio⁸ in the 1980–1985 period was 0.93, but it fell to 0.71 in the 1985–2005 period. The increase in the scale of production and pressures for cost reductions as a result of low oil prices and market deregulation explain the trend in the second period.

TABLE 4.1. MAIN TECHNOLOGICAL IMPROVEMENTS IN THE INDUSTRIAL PROCESS OF ETHANOL PRODUCTION [4.2, 4.6]

Process step Actions Average and best practice results

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