- Email: [email protected]
Comparative analysis for power generation and ethanol production from sugarcane residual biomass in Brazil
Energy Policy 39 (2011) 421–428
Contents lists available at ScienceDirect
Energy Policy journal homepage: www.elsevier.com/locate/enpol
Comparative analysis for power generation and ethanol production from sugarcane residual biomass in Brazil Joaquim E.A. Seabra a,n, Isaias C. Macedo b a b
´ria ‘‘Zeferino Vaz’’, P.O. Box 6122, 13083-970 Campinas, SP, Brazil Faculdade de Engenharia Mecˆ anica, UNICAMP, Cidade Universita ´ria ‘‘Zeferino Vaz’’, P.O. Box 1170, 13084-971 Campinas, SP, Brazil Interdisciplinary Center of Energy Planning (NIPE), UNICAMP, Cidade Universita
a r t i c l e in f o
abstract
Article history: Received 24 May 2010 Accepted 14 October 2010 Available online 4 November 2010
This work compares the technical, economic and environmental (GHG emissions mitigation) performance of power generation and ethanol production from sugarcane residual biomass, considering conversion plants adjacent to a sugarcane mill in Brazil. Systems performances were simulated for a projected enzymatic saccharification co-fermentation plant (Ethanol option) and for a commercial steamRankine power plant (Electricity option). Surplus bagasse from the mill would be used as fuel/raw material for conversion, while cane trash collected from the field would be used as supplementary fuel at the mill. For the Electricity option, the sugarcane biorefinery (mill +adjacent plant) would produce 91 L of ethanol per tonne of cane and export 130 kWh/t of cane, while for the Ethanol option the total ethanol production would be 124 L/t of cane with an electricity surplus of 50 kWh/t cane. The return on investment (ROI) related to the biochemical conversion route was 15.9%, compared with 23.2% for the power plant, for the conditions in Brazil. Considering the GHG emissions mitigation, the environmentally preferred option is the biochemical conversion route: the net avoided emissions associated to the adjacent plants are estimated to be 493 and 781 kgCO2eq/t of dry bagasse for the Electricity and Ethanol options, respectively. & 2010 Elsevier Ltd. All rights reserved.
Keywords: Cellulosic ethanol Bioelectricity CHP
1. Introduction Bioenergy is one of the main alternatives to mitigate GHG emissions (Faaij, 2006) and enhance energy security through the replacement of fossil fuels. Internationally, promising options lie in the utilization of agricultural residues as renewable energy sources (Kartha and Larson, 2000; Botha and von Blottnitz, 2006), among which sugarcane residues in Brazil attract special attention. The primary use of bagasse today is as energy source in mill’s CHP systems to provide the energy requirements of sugar and ethanol processes. Some electricity surplus is also currently produced, and this option has a great potential for expansion as mills adopt modern, commercial high pressure–temperature cogeneration systems (NAE, 2005). Several mills are investing in these systems, and electricity is consolidated as an additional product of the Brazilian sugarcane sector. In 2008, the average surplus generation for a sample of 124 mills was 10.7 kWh/t cane, and the average for the mills selling power was 25 kWh/t cane (UNICA, 2009). For the near future, the biochemical conversion of lignocellulosic materials to ethanol could be the main alternative technology (Seabra et al., 2010). Significant RD&D efforts have
n
Corresponding author. Tel.: + 55 19 3521 3284. E-mail address: [email protected] (J.E. Seabra).
0301-4215/$ - see front matter & 2010 Elsevier Ltd. All rights reserved. doi:10.1016/j.enpol.2010.10.019
occurred in the past 25 years, and the first commercial generation plants are expected within the next 5 years (US DoE, 2009). However, to play a significant role in the sugarcane sector, the biochemical conversion technology must be not only a costeffective alternative, but also competitive with the already commercial steam-Rankine systems for electricity generation from bagasse. Comprehensive comparative analyses (Laser et al., 2009b) have showed that the mature advanced technology to produce ethanol from ligno-cellulosic materials (ammonia fiber expansion (AFEX) pre-treatment and consolidated bioprocessing (CBP)) would be more profitable and able to mitigate more GHG emissions than Rankine-cycle systems, considering switchgrass as feedstock in the US context. Different conclusions are presented by Botha and von Blottnitz (2006) regarding environmental benefits. The authors analyzed the benefits of bagasse-derived electricity (replacing coal-based electricity) and fuel ethanol (replacing gasoline and tetra-ethyl lead) on a lifecycle basis in a developing country context, using South African data. For the conversion technologies modeled (electricity cogeneration and dilute acid hydrolysis), the electricity option would be preferred on energy and carbon balance indicators and energy industry associated impacts (acidification and eutrophication), while the liquid fuel option would be preferred in terms of resource depletion and toxicity concerns. The authors concluded that in the near term, the environmentally
422
J.E.A. Seabra, I.C. Macedo / Energy Policy 39 (2011) 421–428
preferred option is electricity cogeneration, except in cases where a lead additive phase-out comes as a result of fuel ethanol use where large toxicity reduction make this option more attractive. These case studies show that conclusions are dependent on technology assumptions and region of application, indicating that dedicated comparative evaluations for different bagasse uses in Brazil are needed to proper investigate the local case. The objective of this work was to compare the technical–economic performance and the environmental benefits of power generation and ethanol production from sugarcane residual biomass in Brazil, considering conversion plants adjacent to a mill (Fig. 1). For power generation (Electricity option) we considered a commercial Rankine-cycle system, while the ethanol production (Ethanol option) was based on a projected enzymatic saccharification and co–fermentation system (which is expected to be commercially available in the near-term). The economic profitability of each alternative was compared in terms of the return on investment, and environmental benefits were evaluated as the ability to mitigate GHG emissions. Other environmental factors can also play important roles (e.g., toxicity and eutrophication) in this comparison, but they were not included here.
2. Selected systems
Milling capacity Mill’s effective operating time Adjacent plant’s operating time Total milling Bagasse availability Trash availability Ethanol yield
1000 t cane/h 4000 h/year 8406 h/year 4 Mt cane/year 260 kg/t cane (50% moisture content) 66 kg/t cane (15% moisture content) 91 L/t cane (from cane juice)
Energy demand Steam Electricity
360 kg/t cane (2.5 bar) 28 kWh/t cane (all electric drivers)
Cogeneration system
65 bar/480 1C; backpressure turbine
a
From Seabra et al. (2010).
Table 2 Biomass availability and use (dry thousand tonnes/year).a Biomass
Bagasse
Trash
Available at the mill Losses Used in the mill’s boiler Other uses Biomass surplus
520 26 118 14 362
224 11 213 – –
a From Seabra et al. (2010). Values estimated for a mill with capacity of 4 Mt cane/year.
2.1. Sugarcane mill We adopted as reference for this study a 4 Mt cane/year mill producing exclusively anhydrous ethanol (an autonomous distillery) with reduced steam consumption ( 360 kg/t cane) and equipped with a high pressure/temperature cogeneration system (Seabra et al., 2010). This system is able to supply all energy needs of the mill (heat and power) and export some electricity to the grid. Table 1 presents a summary of the main characteristics for this reference mill. In addition to bagasse, we considered that 40% (i.e., 56 kgdry/t cane) of the trash available in the field would be recovered to be
Juice processing
Cane juice
Table 1 Characteristics of the reference mill adopted in this study.a
used as supplementary fuel at the mill (Seabra et al., 2010). To avoid eventual storage problems, we assumed that all trash would be burnt in the mill’s boiler during the cane season (on average 6–7 months) and that only the surplus bagasse would be used as fuel/ raw material in the adjacent plant (see Fig. 1). Based on a simplified model of the mill’s power plant (developed using Aspen PlusTM), Seabra et al. (2010) estimated the final bagasse surplus as 362 dry thousand tonnes/year (see details in Table 2), considering the assumptions presented above. The mill’s backpressure turbine would produce 238 GWh (electricity) during the cane harvesting season, of which 126 GWh could be exported to the grid.
Ethanol 2.2. Power plant: electricity option
Steam
Electricity
Cane trash Mill’s power plant
Bagasse
Electricity
Adjacent plant Bagasse surplus
Electricity option: Power plant
Electricity
OR Ethanol option: Biochem. conversion plant
Fig. 1. Sugarcane biorefinery: mill+ adjacent plant.
Ethanol Electricity
The use of Rankine cycle to produce electricity from biomass is a commercial, mature technology. In the Brazilian sugarcane mills, the conventional cogeneration cycles currently used have been essentially designed to meet mill’s energy needs, consuming all the bagasse available. Since the end of the 1990s, however, with the de–regulation of the Brazilian power sector, mills started an accelerated modernization process, substituting medium-andhigh pressure boilers ( 440 bar) and condensing–extraction steam turbines (CEST) for the old machinery aiming at the production of high electricity surpluses (Leal and Macedo, 2004). Today, all new units and many operating (older) mills are able to work as standalone thermoelectric plants, even during the off-season if biomass is available. In this study, we took as reference for the adjacent plant a steam-Rankine system (Fig. 2), similar to new projects for sugarcane mills (Dedini Indu´strias de Base, 2009). The system is equipped with a 65 bar/480 1C boiler. The system was modeled using HysysTM, and its performance was simulated considering the biomass availability presented above (362 kt/year) and an operating time of 8406 h/year. The total power generation was estimated at 48.6 MW, for a net export of 46.7 MW.
J.E.A. Seabra, I.C. Macedo / Energy Policy 39 (2011) 421–428
423
2.3. Biochemical conversion plant: ethanol option
3. Technical-economic performance
The biochemical conversion of ligno-cellulosic materials to ethanol is not a commercially available technology yet. The analysis performed here is based on a projected system described in Seabra et al. (2010), which is derived from an updated process design version of the 2002 NREL report (Aden et al., 2002). The process consists in the conversion of bagasse into ethanol using dilute acid pretreatment followed by enzymatic hydrolysis and cofermentation (see Fig. 3). The system performance was estimated using reported Aspen PlusTM models, developed by NREL, with the 2012 ethanol cost performance targets (Aden et al., 2002; Humbird and Aden, 2008). As presented in Seabra et al. (2010), the ethanol yield was estimated at approximately 370 L/tdry of bagasse; in addition, the high amount of residues that cannot be converted into ethanol leads to a high potential to export power, evaluated at 0.56 kWh/L ethanol.
Table 3 presents the overall production summary related to the sugarcane biorefinery, combining products from the mill and adjacent plant. In the Electricity option, the total electricity surplus was estimated at 130 kWh/t cane, which is consistent with other studies considering similar assumptions (NAE, 2005; Walter et al., 2005). Alternatively, the adjacent biochemical conversion plant would lead to an additional ethanol production of about 33 L/t cane, but restricting the total electricity surplus at the level of 50 kWh/t cane. The total energy output of the biorefinery would be around 2.4 GJ/t cane for the Electricity option and 2.8 GJ/t cane for the Ethanol option. To compare the economics of both options, we used production costs and energy prices that are current in Brazil today. As presented in Table 4, the fixed capital investment (FCI) related to the adjacent power plant is estimated at 51 M US$, while for the biochemical conversion plant it would be above 151 M US$. Operating costs of the bioconversion plant are also estimated to be much higher than for the Rankine-cycle power plant, leading to a return on investment (ROI) of 15.9% for the Biochemical option, in comparison to 23.2% verified for the Electricity option.
Table 3 Sugarcane biorefinery’s production summary.a Product
Electricity option
Ethanol option
Mill Ethanol 103 m3/year (L/t cane) 364 (91) Electricity GWh/year (kWh/t cane) 126 (32)
364 (91) 126 (32)
Adjacent plant Ethanol 103 m3/year (L/t cane) – Electricity GWh/year (kWh/t cane) 392 (98)
134 (33) 75 (19)
Biorefineryb Ethanol 103 m3/year (L/t cane) 364 (91) Electricity GWh/year (kWh/t cane) 519 (130)
498 (124) 201 (50)
a
Fig. 2. Schematic representation of the steam-Rankine power plant.
Units
b
Based on a cane input of 4 Mt/year plus 224,000 t cane trash (dry). Biorefinery ¼ mill+ adjacent plant.
Fig. 3. Process flow diagram for biochemical conversion of bagasse to ethanol (modified from Aden et al., 2002).
424
J.E.A. Seabra, I.C. Macedo / Energy Policy 39 (2011) 421–428
Table 4 Profitability analysis for the adjacent plant (MUS$2007).a Parameter
Electricity option
Ethanol option
FCIb,c Working capitald
50.7 2.5
151.4 7.6
Annual costse Operating costsf Biomassg Depreciationh
15.1 6.7 3.4 5.1
33.5 15.0 3.4 15.1
Annual salese,i
27.5
58.7
ROIj
23.2%
15.9%
a Values in United States 2007 dollars. We considered an exchange rate of 2 R$/US$. b Fixed capital investment (FCI) was calculated based on vendor quotations and specialists’ information on equipments’ cost for given sizes (determined using the simulation models). For the Electricity option, this value includes the investment needed for grid connection. Such investment varies considerably between different projects, depending on the distance from the mill to the substation, the line voltage, among other system characteristics. Here, we assumed this investment as approximately 5 M US$, based on averages of recent investments in Brazil given by local specialists. c The value for Ethanol option is derived from Seabra et al. (2010). d Assumed as 5% of FCI (Aden et al., 2002). e M US$/year. f Include consumables, labor, overhead, maintenance, insurance and taxes. For the Electricity option values are estimated from EPE (2008), while for the Ethanol option, values are derived from Seabra et al. (2010). g Bagasse at 0 US$/tdry and trash at 15 US$/tdry. Cane trash is used as supplementary fuel at the mill, but its cost was entirely attributed to the adjacent plant. h 10% of FCI. i Annual sales of electricity surplus and ethanol. Ethanol price at 400 US$/m3 (value at the mill gate) and electricity price at 70 US$/MWh. These are typical values verified in the industry (Cepea, 2009). j Return on investment (ROI) was calculated here as the annual profit before income taxes (i.e., the difference between annual sales and total costs, including depreciation), divided by the total investment (i.e., FCI plus working capital).
Here, it is important to point out the uncertainties related to the cost estimate for the biochemical conversion route, since it is not a commercial technology. Moreover, even though the investment needs and operating costs are estimated for an ‘‘nth plant’’ (Aden et al., 2002), further technological developments are expected in the long run, eventually reducing capital needs and increasing yields (Laser et al., 2009a). Besides, important cost reductions may be verified for systems fully integrated to sugarcane mills, avoiding capital expenditures and increasing the utilization of the already existing installed capacity of the mill. For the Rankine-cycle system, on the other hand, significant cost reductions are not expected in the future as it is an already mature technology. In this analysis, the specific project investment was evaluated as 1085 US$/kWexported, which is comparable to values presented in other analysis (Jin et al., 2009). For the long run, however, advanced technologies based on biomass gasification integrated to combined cycles (BIG-GT/CC) might practically double the power generation efficiency compared to current commercial Rankine-cycle systems, although capital investments are expected to be as high as 1500–2000 US$/kW, for similar scales of this study (Jin et al., 2009). Fig. 4 shows the sensitivity analysis for fixed capital investment, ethanol and electricity prices and scale for both adjacent plant options. The sensitivity to biomass costs is presented separately in Fig. 5. The impacts of biomass cost variation are very different for the two technology options. Biomass represents a large fraction of annual expenses related to the Electricity option, and this option is more sensitive to the feedstock cost. For high biomass cost scenarios, ROI for the biochemical conversion plant may be even higher than in a power plant.
The biochemical conversion route is a more complex, costly technology, projected to reach greater revenues. However, for the reference (actual) cost conditions assumed in this study, higher ethanol prices are needed to yield better profitability in comparison with the Electricity alternative option. As Fig. 6 shows, for the current electricity price level (70 US$/MWh), the ethanol price must be around 490 US$/m3 to yield an equal ROI for both investment options. In this case, it is important to observe that in Brazil higher ethanol prices scenarios are more likely for the near term than higher electricity prices. The ethanol prices are defined by the market, so an increased demand for ethanol in the external market or higher gasoline prices in Brazil (both are reasonable scenarios) might lead to higher ethanol prices. Electricity from cane mills, on the other hand, is mostly bid in public auctions (along with electricity from other sources), for which maximum tariffs are established by the government. Therefore, electricity prices are not expected to rise, although recent analysis (Castro et al., 2010) has shown that modifications of the Brazilian public auctions methodology could lead to higher values for bagasse derived electricity. The suggested modifications include promoting auctions by energy source or specific auctions for the dry season base load generation.
4. GHG emissions mitigation The comparative evaluation of GHG emissions mitigation related to each technology is based on a 2020 project scenario, when biochemical conversion technology is expected to be commercially available. The parameters assumed for such scenario, defined by (Centro de Tecnologia Canavieira (CTC)) specialists, are presented in Table 5. Sugarcane production parameters are the same for both technologies, while industrial parameters are derived from the simulations presented here. In this analysis, we assumed that ethanol would be transported by truck, but in 2020 other modes for ethanol transportation (rail and pipelines) will probably play an important role in Brazil as well. These are more efficient modes and could eventually reduce ethanol life-cycle emissions. Two regression levels of energy flows were considered in the GHG emissions evaluation, in addition to field emissions: (i) the direct consumption of external fuels and electricity (direct energy inputs) and (ii) the energy required for the production of chemicals inputs in agricultural and industrial processes (e.g., fertilizers, limestone, pesticides, etc.). The emissions related to embodied energy in machinery and buildings were not accounted for, to be consistent with other analysis performed for fossil fuels. These flows are usually small and do not have significant effect on the comparative analysis (Seabra and Macedo, 2010). Carbon emissions from direct and indirect land use change (LUC and iLUC) were not included either. For the direct LUC effects, the data for the specific land use changes for sugarcane expansion in the last decade indicates that less than 2% occurred over native vegetation areas (with higher C stocks) and the overall effect may actually be of increasing the C stocks in soil (Zuurbier and van de Vooren, 2008), which is also expected for the next decade. For the iLUC, effects there is no scientific consensus on a methodology to evaluate these emissions. But the large area availability in Brazil and the intensification of the cattle raising systems, together with the current legislation, indicate that the iLUC effects could be very small (Nassar et al., 2009). The GREET 1.8c.0 model (GREET, 2009) was used to evaluate GHG emissions in the sugarcane products lifecycle, updated with the parameters presented here. We changed some default parameters (e.g., the energy consumption for limestone production) in order to better represent Brazilian conditions, as discussed in Seabra and Macedo (2010). For chemical inputs in industry, we
J.E.A. Seabra, I.C. Macedo / Energy Policy 39 (2011) 421–428
Ethanol option
40%
40%
30%
30% ROI
ROI
Electricty option
425
20%
20% 10%
10% 0% 40% 60% 80% 100% 120% 140% 160%
0% 40% 60% 80% 100% 120% 140% 160% Parameter variation
Parameter variation Ethanol price
Electricity price
FCI
Scale
Fig. 4. Sensitivity analysis for ethanol and electricity prices, fixed capital investment (FCI) and scale. Reference case (100%) as of Table 4.
Ethanol option 25%
20%
20%
15%
15%
ROI
ROI
Electricity option 25%
10%
10%
5%
5%
0%
0% 20
10
30
50
40
Bagasse at 0 US$/t dry
20
10
Cane trash cost (US$/tdry)
30
50
40
Cane trash cost (US$/tdry) Bagasse at 10 US$/t dry
Bagasse at 20 US$/t dry
Fig. 5. Sensitivity analysis of biomass cost.
700
Table 5 Projected parameters for sugarcane production in 2020.a
Ethanol price (US$/m3)
600
Units
500 400 300 200 100 0 50
60
70
80
90
Electricity price (US$/MWh) Fig. 6. Equal ROI prices for ethanol and electricity.
performed the analysis apart from GREET, based on aggregated information from Brazilian Chemical Industry Association (Abiquim, 2008). The avoided emissions were estimated considering the substitution of sugarcane products for the equivalent products in Brazil. Anhydrous ethanol substitutes for gasoline, as E22 blends to operate in gasohol dedicated cars, while bagasse-derived electricity displaces natural gas thermoelectric generation, which is the main fuel of the marginal electricity generation in Brazil (Seabra and Macedo, 2010). Since sugarcane production parameters are the same for both technology routes, the total GHG emissions resulted to be similar,
Parameter Cane productivity Harvested area % total area Total diesel consumptionb Unburned cane harvesting Mechanical harvesting Total trash yield Cane trash collection Above ground nitrogenc
t/ha % L/ha % % kgdry/t cane % g/t cane
Agr. Inputs N P2O5 K2O CaCO3
g/t g/t g/t g/t
cane cane cane cane
Value
95 90 350 100 100 140 40 992 548 32 70 4,947
a Values projected by CTC specialists. Parameters not presented here are assumed to be equal to the current averages (Seabra and Macedo, 2010). b Includes diesel consumption in all activities (sugarcane farming, harvesting, transportation, etc.). c Estimated above ground nitrogen availability related to crop and industrial residues returned to the soil. We assumed that 60% of the available trash would remain on the ground after cane harvesting.
as presented in Table 6. Small differences are observed in the sugarcane processing; in the Electricity option, greater direct emissions are verified, derived from bagasse combustion, while Ethanol option present greater emissions associated to chemicals production. For the Ethanol option, emissions from ethanol transport and distribution and fuel combustion (tailpipe emissions) are naturally greater than for the Electricity option, due to the higher ethanol yield per tonne of cane.
426
J.E.A. Seabra, I.C. Macedo / Energy Policy 39 (2011) 421–428
120
Electricity option Total emissions Sugarcane farming Trash burning Field emissions Agr. inputs production Sugarcane transportation Sugarcane processing Ethanol T&D Tailpipe emissions
Ethanol option
40.0 10.8 0.0 11.7 4.3 2.5 5.7 3.4 1.5
42.3 10.8 0.0 11.7 4.3 2.5 6.1 4.7 2.1
Avoided emissions Marginal electricity displacement Gasoline displacementb
281.8 76.6 205.1
310.2 29.7 280.5
Net avoided emissions
241.8
267.9
a b
Mill + adjacent plant. Fuel equivalence: 1.3 L ethanol/L gasoline (Seabra and Macedo, 2010).
Gasoline emissions (g CO2eq/MJ)
Table 6 GHG emissions balance for the sugarcane biorefinerya (kg CO2eq/t cane).
100 80 60 40 20 0 400
500
600
700
800
900
1000
Marginal electricity emissions (kg CO2eq/MWh) Fig. 7. Lifecycle emissions for gasoline and marginal electricity to yield equal net avoided emissions.
Table 7 GHG emissions balance for the adjacent plant (kg CO2 eq/t dry bagasse). Electricity option Total emissions Bagasse ‘‘production’’a Bagasse processing Ethanol T&D Tailpipe emissions
Ethanol option
148 120 28
173 120 33 14 6
Avoided emissions Marginal electricity displacement Gasoline displacement
641 641
955 122 833
Net avoided emissions
493
781
a Part of the sugarcane production emissions was allocated to the surplus bagasse, based on the energy content of mill’s products (ethanol, electricity and bagasse surplus). Ethanol and bagasse energy flows were calculated using the respective lower heating values, and for electricity, we considered a heat rate of 9 MJ/kWh.
Despite the additional emission sources, the Ethanol option is able to mitigate more GHG emissions. This environmental advantage is stressed in Table 7, which presents the emissions balance related only to the adjacent plants. In this table, only the inputs and outputs of the adjacent plant are considered (i.e., the ethanol and electricity produced at the mill are not taken into account). Since a biorefinery concept is involved, with the production of multiple products, a procedure was adopted to allocate the upstream emission burdens among the products from the mill and the adjacent plant. Emissions derived from cane production were allocated based on the energy content of mill’s products (ethanol, electricity and bagasse surplus), leading to the ‘‘bagasse production’’ emissions. Alternatively, emissions credits from the coproducts could be assigned to the main product using a system expansion method. Though avoided emissions by the displacement of NG thermoelectricity are significant (even for the Ethanol option), the benefits of ethanol substitution for gasoline determines the preference for the liquid fuel production. Nevertheless, power generation is preferred if more carbon intensive fuels (coal, for instance) are considered for the marginal electricity generation, as illustrated in Fig. 7. Similarly to the economics, these results are sensitive to the products yields (net avoided emissions and yields have a practically linear relationship), and differences in the assumed process efficiencies may change the final results. For different biorefinery concepts (and feedstocks) producing ethanol (or other biofuel), the comparison between the emissions
mitigation promoted by ethanol with respect to gasoline is frequently used. In many cases, the conclusions about which option promotes the greater mitigation are difficult: co-products credits can result in apparently greater benefits than higher ethanol yields, since emissions are evaluated per cubic meter of fuel. For the cases evaluated here, for instance, ethanol life-cycle emissions would be 19 and 5 g CO2eq/MJ, respectively for the Electricity and Ethanol options. The electricity option apparently presents a better environmental performance essentially because more credits are assigned to ethanol, while less fuel is produced per tonne of cane. Therefore, comparisons leveled by the feedstock, or preferably by unit of land area, are more appropriate to evaluate the overall benefit.
5. Energy policies and the decision: ethanol or electricity from bagasse and trash? Energy policies which may lead to decisions on producing more electricity or more ethanol from cane residues will probably be essentially local, Brazilian policies rather than global initiatives like the Clean Development Mechanism (CDM) or carbon taxes. The context for the Brazilian sugarcane industry shows a strong growth: 387 Mt cane/year, in 2005/2006; 564 Mt in 2008/ 2009, and projected 1100 Mt cane/year, in 2020 (UNICA, 2010). Sugar production will take 30% of the cane in 2020 (against 40% today); ethanol (as fuel for internal market and exports, and less than 10% for industrial uses including plastics production) will use the largest portion (EPE, 2010). All uses will provide surplus bagasse and trash for electricity (or ethanol). Since 2002 a large number of mills is being built, and the decision to produce more electricity is made at this point, involving the adoption of higher pressure boilers, condensation capacity, turbines and generators. The experience to date shows that: 1. There have been no significant government policies to promote (or support) ethanol since 1990. The only policy remaining from the Pro-Alcool program is the mandatory 20–25% blend with gasoline (which accounts for a relatively small portion of the ethanol used). Ethanol became competitive with gasoline at relatively low oil prices (BNDES, CGEE, 2008). Growth has been assured by technological innovation (like the flex-fuel car, today).
J.E.A. Seabra, I.C. Macedo / Energy Policy 39 (2011) 421–428
2. Ethanol is not considered eligible for any carbon credit (like CDM, for instance). Surplus electricity is eligible, but the values paid are not significant (today) to lead to a positive response from the investors. 3. Today the technology for producing electricity is commercial, well known in Brazil, and the extra cost for a new mill to incorporate it is acceptable. The technologies for 2nd generation ethanol are not available, and they may not become fully tested, commercial, before 2015 in Brazil (Seabra, 2008). Even then, the ethanol costs may be higher than the 1st generation ethanol. This means: it may need subsidies for some time, and this will be very difficult to obtain in Brazil. 4. The most important point: the Brazilian electricity supply system is 85% from hydro power; the 15% from thermal power complements the demand (for both the Integrated and Isolated systems). Projections (EPE, 2009) indicate that from 2008 to 2017 the installed capacities for hydroelectricity will decrease from 81.9% to 70.9%, increasing in fuel oil-based power (0.9 to 5.7%). The affluent energy for hydroelectricity is highly seasonal: in the dry season it drops to 30–40% of the rain season (Castro et al., 2010). New hydro units have much smaller water reservoirs: in 1970 the reservoirs corresponded to 28 months of operation, and in 2008 only 6 months. This leads to increasing dispatch of thermal power to help the supply system. The bagasse based units are inflexible thermal based systems (they are always dispatched). They are in the lowest range of CVU (unit variable cost) for the thermal systems (Castro et al., 2010). The bagasse based power generation happens in the dry season (May–November), in complementation to the hydro affluent energy. 5. For the reasons above, the Brazilian government started (a few years ago) to promote the use of bagasse-generated electricity. This includes long-term contracts (15 year), lower interest rates in financing equipment specific for higher efficiency in power generation in cane processing units, specific auctions to buy energy from renewable sources, and more recently adapting the distribution systems to receive power from the mills. There is a rapidly increasing number of mills planning for increased generation, and all the new mills are designed to do it. At this moment, it appears that the availability of technology, the need for thermal complementation of the electricity supply and the specific policies adopted by the Brazilian government define the trend we will see in the decade.
6. Conclusion Sugarcane residues are one of the main feedstock options for the future biomass conversion technologies. Today, the only commercial option is electricity generation through conventional steam cycles, which represents an attractive business option for Brazilian sugarcane mills. For the near-future, the biochemical conversion of ligno-cellulosic materials into ethanol will probably raise as an important alternative. This work compared the technical, economic and environmental (GHG emissions mitigation) performance of power generation and ethanol production from sugarcane bagasse, considering the technology alternatives for the near-term. Simulated performances presented here indicate that ethanol production in a projected enzymatic saccharification co-fermentation system would lead to greater energy outputs compared to electricity generation in commercial steam-Rankine systems. The profitability of the biochemical conversion plant would not be favorable in comparison to the power plant for the reference values adopted here. Despite the higher revenues, estimated investment
427
needs and annual expenses for the Ethanol option would be far greater than the values for the conventional power plant, resulting in a considerably lower return on investment (ROI). The economics for the biochemical conversion may improve as technology advances, leading to lower capital needs and greater yields; and better integration of these systems with the sugarcane mill may also improve results even in the short-term. The sensitivity analyses show that the biomass cost has a significant impact on the economic performance, especially for the Electricity option. For high bagasse (or trash) costs the return on investment for the Electricity option would be lower than for the Ethanol option. For the baseline conditions assumed here, the environmentally preferred option, with respect to GHG emissions mitigation, is the biochemical conversion route. Ethanol substitution for gasoline leads to greater emissions mitigation than the displacement of the natural gas thermoelectricity by bagasse derived electricity. In this case, the establishment of a carbon market embracing fuel ethanol can improve the biochemical conversion route competitiveness, even though the necessity to rapidly expand the power generation capacity in Brazil is also an important factor to be considered in this comparison.
Acknowledgements The authors thankfully acknowledge UNICA for helping in the revision of this work. Specialists of the Centro de Tecnologia Canavieira (CTC) are also gratefully acknowledged for the data provision and assistance in the analysis. Discussion with specialists from the Argonne National Laboratory (IL, USA) and the National Renewable Energy Laboratory (CO, USA) in the context of the Brazil-USA bilateral collaboration on advanced biofuels was also very important for this work. References ~ de ga´s carboˆ nico e consumo de Abiquim, 2008. Indu´stria quı´mica reduziu emissoes a´gua. Comunicac- a~ o Abiquim (Associac- a~ o Brasileira da Indu´stria Quı´mica), 18 de Junho, Sa~ o Paulo, Brasil. Aden, A., Ruth, M., Ibsen, K., Jechura, J., Neeves, K., Sheehan, J., Wallace, B., Montague, L., Slayton, A., Lukas, J., 2002. Lignocellulosic biomass to ethanol process design and economics utilizing co-current dilute acid prehydrolysis and enzymatic hydrolysis for corn stover. National Renewable Energy Laboratory; Golden (CO): June 2002. Report No.: TP-510-32438. BNDES, CGEE (coordination), 2008. Sugarcane-based ethanol: energy for sustainable development. Rio de Janeiro: BNDES, 304p. Botha, T., von Blottnitz, H., 2006. A comparison of the environmental benefits of bagasse-derived electricity and fuel ethanol on a life-cycle basis. Energy Policy 34, 2654–2661. Castro, N.J., Branda~ o, R., Dantas, G.A., 2010. Importˆancia e perspectivas da bioeletricidade sucroenerge´tica na matriz ele´trica brasileira. In: Souza, E.L., Macedo, I.C. (Eds.), Etanol e bioeletricidade: a cana de ac-u´car no futuro da Matriz energe´tica. Luc Projetos de Comunicac- a~ o Ltda., Sa~ o Paulo, pp. 2010. Cepea, 2009. Centro de Estudos Avanc- ados em Economia Aplicada. /www.cepea. esalq.usp.brS. Dedini Indu´strias de Base. 2009. /www.dedini.com.brS. o EPE, 2008. 1 % Leila~ o de energia de reserva – 2008: Definic- a~ o do prec- o inicial. No. EPEDEE/DEN-067/2008-r4, 15 de julho de 2008. Empresa de Pesquisa Energe´tica, Rio de Janeiro, RJ. EPE, 2009. Plano decenal de expansa~ o de energia 2008/2017. Ministe´rio de Minas e Energia. Empresa de Pesquisa Energe´tica. EPE, Rio de Janeiro,. EPE, 2010. Plano decenal de expansa~ o de energia 2019. Ministe´rio de Minas e Energia. Empresa de Pesquisa Energe´tica. MME/EPE, Brası´lia,. Faaij, A.P.C., 2006. Bio-energy in Europe: changing technology choices. Energy Policy 34, 322–342. GREET, 2009. The Greenhouse Gases, Regulated Emissions, and Energy Use in Transportation Model. Software: GREET 1, Version 1.8c.0. UChicago Argonne, LLC. Humbird, D., Aden, A., 2008. FY08 state of technology update. Internal NREL Milestone Completion Report. National Renewable Energy Laboratory, October 30, Golden, CO, USA. Jin, H., Larson, E.D., Celik, F.E., 2009. Performance and cost analysis of future, commercially mature gasification-based electric power generation from switchgrass. Biofuels, Biorproducts & Biorefining 3, 142–173.
428
J.E.A. Seabra, I.C. Macedo / Energy Policy 39 (2011) 421–428
Laser, M., Jin, H., Jayawardhana, K., Lynd, L.R., 2009a. Coproduction of ethanol and power from switchgrass. Biofuels, Bioproducts & Biorefining 3, 195–218. Laser, M., Larson, E., Dale, B., Wang, M., Greene, N., Lynd, L.R., 2009b. Comparative analysis of efficiency, environmental impact, and process economics for mature biomass refining scenarios. Biofuels, Bioproducts & Biorefining 3, 247–270. o NAE, 2005. Biocombustı´veis. Cadernos NAE n % 2 (Jan. 2005). Brası´lia: Nu´cleo de Assuntos Estrate´gicos da Presidˆencia da Repu´blica, Secretaria de Comunicac- a~ o de Governo e Gesta~ o Estrate´gica. Nassar A.M., Harfuch L., Moreira M.M.R., Bachion, L.C., Antoniazzi, L.B., 2009. Impacts on land use and GHG emissions from a shock on Brazilian sugarcane ethanol exports to the United States using the Brazilian land use model (BLUM). Report to the U.S. Environmental Protection Agency regarding the Proposed Changes to the Renewable Fuel Standard Program. Institute for International Trade Negotiations (ICONE), September 2009. Kartha, S., Larson, E.D., 2000. Bioenergy primer: Modernised biomass energy for sustainable development. United Nations Development Programme (UNDP). Leal, M.R.L.V., Macedo, I.C., 2004. Evoluc- a~ o tecnolo´gica dos sistemas de gerac- a~ o de energia nas usinas de ac- u´car e a´lcool. Biomassa & Energia 1 (3), 245–253. Seabra, J.E.A., 2008. Technical-economic evaluation of options for whole use of sugar cane biomass in Brazil. Campinas, Faculdade de Engenharia Mecˆanica, Universidade Estadual de Campinas (Unicamp). PhD thesis, 274p.
Seabra, J.E.A., Macedo, I.C., 2010. Lifecycle assessment of Brazilian sugarcane products: GHG emissions and energy use. Report to UNICA, Sa~ o Paulo. Seabra, J.E.A., Tao, L., Chum, H.L., Macedo, I.C., 2010. A techno-economic evaluation of the effects of centralized cellulosic ethanol and co-products refinery options with sugarcane mill clustering. Biomass and Bioenergy 34, 1065–1078. UNICA, 2009. Supporting information provided to CARB on a Confidential Business Information’’ basis in June 2009. ’’Comment submitted by Brazilian Sugarcane Industry Association (UNICA), Document ID EPA-HQ-OAR-2005-0161-1761.1. Letter to Environmental Protection Agency, Docket EPA-HQ-OAR-2005-0161. Washington, DC. UNICA, 2010. Unia~ o da Indu´stria de Cana-de-ac-u´car. /www.unica.com.brS. Retrieved on January 2010. U.S. DoE, 2009. Department of Energy, Washington, US /www.energy.govS. Walter, A., Llagostera, J.I., Ensinas, A.V., Maio, D.S., Reis, M., Leme, R.M., 2005. Levantamento do Potencial Nacional de Produc- a~ o de Eletricidade nos Segmentos Sucro-alcooleiro, Madeireiro e em Usinas de Beneficiamento de Arroz. Parte I. Relato´rio para PNUD/MME. NIPE/Unicamp, Campinas, Brasil. Zuurbier, P., van de Vooren, J. (Eds.), 2008. Sugarcane ethanol: Contributions to climate change mitigation and the environment. Wageningen Academic Publishers, The Netherlands, 255p.
Contents lists available at ScienceDirect
Energy Policy journal homepage: www.elsevier.com/locate/enpol
Comparative analysis for power generation and ethanol production from sugarcane residual biomass in Brazil Joaquim E.A. Seabra a,n, Isaias C. Macedo b a b
´ria ‘‘Zeferino Vaz’’, P.O. Box 6122, 13083-970 Campinas, SP, Brazil Faculdade de Engenharia Mecˆ anica, UNICAMP, Cidade Universita ´ria ‘‘Zeferino Vaz’’, P.O. Box 1170, 13084-971 Campinas, SP, Brazil Interdisciplinary Center of Energy Planning (NIPE), UNICAMP, Cidade Universita
a r t i c l e in f o
abstract
Article history: Received 24 May 2010 Accepted 14 October 2010 Available online 4 November 2010
This work compares the technical, economic and environmental (GHG emissions mitigation) performance of power generation and ethanol production from sugarcane residual biomass, considering conversion plants adjacent to a sugarcane mill in Brazil. Systems performances were simulated for a projected enzymatic saccharification co-fermentation plant (Ethanol option) and for a commercial steamRankine power plant (Electricity option). Surplus bagasse from the mill would be used as fuel/raw material for conversion, while cane trash collected from the field would be used as supplementary fuel at the mill. For the Electricity option, the sugarcane biorefinery (mill +adjacent plant) would produce 91 L of ethanol per tonne of cane and export 130 kWh/t of cane, while for the Ethanol option the total ethanol production would be 124 L/t of cane with an electricity surplus of 50 kWh/t cane. The return on investment (ROI) related to the biochemical conversion route was 15.9%, compared with 23.2% for the power plant, for the conditions in Brazil. Considering the GHG emissions mitigation, the environmentally preferred option is the biochemical conversion route: the net avoided emissions associated to the adjacent plants are estimated to be 493 and 781 kgCO2eq/t of dry bagasse for the Electricity and Ethanol options, respectively. & 2010 Elsevier Ltd. All rights reserved.
Keywords: Cellulosic ethanol Bioelectricity CHP
1. Introduction Bioenergy is one of the main alternatives to mitigate GHG emissions (Faaij, 2006) and enhance energy security through the replacement of fossil fuels. Internationally, promising options lie in the utilization of agricultural residues as renewable energy sources (Kartha and Larson, 2000; Botha and von Blottnitz, 2006), among which sugarcane residues in Brazil attract special attention. The primary use of bagasse today is as energy source in mill’s CHP systems to provide the energy requirements of sugar and ethanol processes. Some electricity surplus is also currently produced, and this option has a great potential for expansion as mills adopt modern, commercial high pressure–temperature cogeneration systems (NAE, 2005). Several mills are investing in these systems, and electricity is consolidated as an additional product of the Brazilian sugarcane sector. In 2008, the average surplus generation for a sample of 124 mills was 10.7 kWh/t cane, and the average for the mills selling power was 25 kWh/t cane (UNICA, 2009). For the near future, the biochemical conversion of lignocellulosic materials to ethanol could be the main alternative technology (Seabra et al., 2010). Significant RD&D efforts have
n
Corresponding author. Tel.: + 55 19 3521 3284. E-mail address: [email protected] (J.E. Seabra).
0301-4215/$ - see front matter & 2010 Elsevier Ltd. All rights reserved. doi:10.1016/j.enpol.2010.10.019
occurred in the past 25 years, and the first commercial generation plants are expected within the next 5 years (US DoE, 2009). However, to play a significant role in the sugarcane sector, the biochemical conversion technology must be not only a costeffective alternative, but also competitive with the already commercial steam-Rankine systems for electricity generation from bagasse. Comprehensive comparative analyses (Laser et al., 2009b) have showed that the mature advanced technology to produce ethanol from ligno-cellulosic materials (ammonia fiber expansion (AFEX) pre-treatment and consolidated bioprocessing (CBP)) would be more profitable and able to mitigate more GHG emissions than Rankine-cycle systems, considering switchgrass as feedstock in the US context. Different conclusions are presented by Botha and von Blottnitz (2006) regarding environmental benefits. The authors analyzed the benefits of bagasse-derived electricity (replacing coal-based electricity) and fuel ethanol (replacing gasoline and tetra-ethyl lead) on a lifecycle basis in a developing country context, using South African data. For the conversion technologies modeled (electricity cogeneration and dilute acid hydrolysis), the electricity option would be preferred on energy and carbon balance indicators and energy industry associated impacts (acidification and eutrophication), while the liquid fuel option would be preferred in terms of resource depletion and toxicity concerns. The authors concluded that in the near term, the environmentally
422
J.E.A. Seabra, I.C. Macedo / Energy Policy 39 (2011) 421–428
preferred option is electricity cogeneration, except in cases where a lead additive phase-out comes as a result of fuel ethanol use where large toxicity reduction make this option more attractive. These case studies show that conclusions are dependent on technology assumptions and region of application, indicating that dedicated comparative evaluations for different bagasse uses in Brazil are needed to proper investigate the local case. The objective of this work was to compare the technical–economic performance and the environmental benefits of power generation and ethanol production from sugarcane residual biomass in Brazil, considering conversion plants adjacent to a mill (Fig. 1). For power generation (Electricity option) we considered a commercial Rankine-cycle system, while the ethanol production (Ethanol option) was based on a projected enzymatic saccharification and co–fermentation system (which is expected to be commercially available in the near-term). The economic profitability of each alternative was compared in terms of the return on investment, and environmental benefits were evaluated as the ability to mitigate GHG emissions. Other environmental factors can also play important roles (e.g., toxicity and eutrophication) in this comparison, but they were not included here.
2. Selected systems
Milling capacity Mill’s effective operating time Adjacent plant’s operating time Total milling Bagasse availability Trash availability Ethanol yield
1000 t cane/h 4000 h/year 8406 h/year 4 Mt cane/year 260 kg/t cane (50% moisture content) 66 kg/t cane (15% moisture content) 91 L/t cane (from cane juice)
Energy demand Steam Electricity
360 kg/t cane (2.5 bar) 28 kWh/t cane (all electric drivers)
Cogeneration system
65 bar/480 1C; backpressure turbine
a
From Seabra et al. (2010).
Table 2 Biomass availability and use (dry thousand tonnes/year).a Biomass
Bagasse
Trash
Available at the mill Losses Used in the mill’s boiler Other uses Biomass surplus
520 26 118 14 362
224 11 213 – –
a From Seabra et al. (2010). Values estimated for a mill with capacity of 4 Mt cane/year.
2.1. Sugarcane mill We adopted as reference for this study a 4 Mt cane/year mill producing exclusively anhydrous ethanol (an autonomous distillery) with reduced steam consumption ( 360 kg/t cane) and equipped with a high pressure/temperature cogeneration system (Seabra et al., 2010). This system is able to supply all energy needs of the mill (heat and power) and export some electricity to the grid. Table 1 presents a summary of the main characteristics for this reference mill. In addition to bagasse, we considered that 40% (i.e., 56 kgdry/t cane) of the trash available in the field would be recovered to be
Juice processing
Cane juice
Table 1 Characteristics of the reference mill adopted in this study.a
used as supplementary fuel at the mill (Seabra et al., 2010). To avoid eventual storage problems, we assumed that all trash would be burnt in the mill’s boiler during the cane season (on average 6–7 months) and that only the surplus bagasse would be used as fuel/ raw material in the adjacent plant (see Fig. 1). Based on a simplified model of the mill’s power plant (developed using Aspen PlusTM), Seabra et al. (2010) estimated the final bagasse surplus as 362 dry thousand tonnes/year (see details in Table 2), considering the assumptions presented above. The mill’s backpressure turbine would produce 238 GWh (electricity) during the cane harvesting season, of which 126 GWh could be exported to the grid.
Ethanol 2.2. Power plant: electricity option
Steam
Electricity
Cane trash Mill’s power plant
Bagasse
Electricity
Adjacent plant Bagasse surplus
Electricity option: Power plant
Electricity
OR Ethanol option: Biochem. conversion plant
Fig. 1. Sugarcane biorefinery: mill+ adjacent plant.
Ethanol Electricity
The use of Rankine cycle to produce electricity from biomass is a commercial, mature technology. In the Brazilian sugarcane mills, the conventional cogeneration cycles currently used have been essentially designed to meet mill’s energy needs, consuming all the bagasse available. Since the end of the 1990s, however, with the de–regulation of the Brazilian power sector, mills started an accelerated modernization process, substituting medium-andhigh pressure boilers ( 440 bar) and condensing–extraction steam turbines (CEST) for the old machinery aiming at the production of high electricity surpluses (Leal and Macedo, 2004). Today, all new units and many operating (older) mills are able to work as standalone thermoelectric plants, even during the off-season if biomass is available. In this study, we took as reference for the adjacent plant a steam-Rankine system (Fig. 2), similar to new projects for sugarcane mills (Dedini Indu´strias de Base, 2009). The system is equipped with a 65 bar/480 1C boiler. The system was modeled using HysysTM, and its performance was simulated considering the biomass availability presented above (362 kt/year) and an operating time of 8406 h/year. The total power generation was estimated at 48.6 MW, for a net export of 46.7 MW.
J.E.A. Seabra, I.C. Macedo / Energy Policy 39 (2011) 421–428
423
2.3. Biochemical conversion plant: ethanol option
3. Technical-economic performance
The biochemical conversion of ligno-cellulosic materials to ethanol is not a commercially available technology yet. The analysis performed here is based on a projected system described in Seabra et al. (2010), which is derived from an updated process design version of the 2002 NREL report (Aden et al., 2002). The process consists in the conversion of bagasse into ethanol using dilute acid pretreatment followed by enzymatic hydrolysis and cofermentation (see Fig. 3). The system performance was estimated using reported Aspen PlusTM models, developed by NREL, with the 2012 ethanol cost performance targets (Aden et al., 2002; Humbird and Aden, 2008). As presented in Seabra et al. (2010), the ethanol yield was estimated at approximately 370 L/tdry of bagasse; in addition, the high amount of residues that cannot be converted into ethanol leads to a high potential to export power, evaluated at 0.56 kWh/L ethanol.
Table 3 presents the overall production summary related to the sugarcane biorefinery, combining products from the mill and adjacent plant. In the Electricity option, the total electricity surplus was estimated at 130 kWh/t cane, which is consistent with other studies considering similar assumptions (NAE, 2005; Walter et al., 2005). Alternatively, the adjacent biochemical conversion plant would lead to an additional ethanol production of about 33 L/t cane, but restricting the total electricity surplus at the level of 50 kWh/t cane. The total energy output of the biorefinery would be around 2.4 GJ/t cane for the Electricity option and 2.8 GJ/t cane for the Ethanol option. To compare the economics of both options, we used production costs and energy prices that are current in Brazil today. As presented in Table 4, the fixed capital investment (FCI) related to the adjacent power plant is estimated at 51 M US$, while for the biochemical conversion plant it would be above 151 M US$. Operating costs of the bioconversion plant are also estimated to be much higher than for the Rankine-cycle power plant, leading to a return on investment (ROI) of 15.9% for the Biochemical option, in comparison to 23.2% verified for the Electricity option.
Table 3 Sugarcane biorefinery’s production summary.a Product
Electricity option
Ethanol option
Mill Ethanol 103 m3/year (L/t cane) 364 (91) Electricity GWh/year (kWh/t cane) 126 (32)
364 (91) 126 (32)
Adjacent plant Ethanol 103 m3/year (L/t cane) – Electricity GWh/year (kWh/t cane) 392 (98)
134 (33) 75 (19)
Biorefineryb Ethanol 103 m3/year (L/t cane) 364 (91) Electricity GWh/year (kWh/t cane) 519 (130)
498 (124) 201 (50)
a
Fig. 2. Schematic representation of the steam-Rankine power plant.
Units
b
Based on a cane input of 4 Mt/year plus 224,000 t cane trash (dry). Biorefinery ¼ mill+ adjacent plant.
Fig. 3. Process flow diagram for biochemical conversion of bagasse to ethanol (modified from Aden et al., 2002).
424
J.E.A. Seabra, I.C. Macedo / Energy Policy 39 (2011) 421–428
Table 4 Profitability analysis for the adjacent plant (MUS$2007).a Parameter
Electricity option
Ethanol option
FCIb,c Working capitald
50.7 2.5
151.4 7.6
Annual costse Operating costsf Biomassg Depreciationh
15.1 6.7 3.4 5.1
33.5 15.0 3.4 15.1
Annual salese,i
27.5
58.7
ROIj
23.2%
15.9%
a Values in United States 2007 dollars. We considered an exchange rate of 2 R$/US$. b Fixed capital investment (FCI) was calculated based on vendor quotations and specialists’ information on equipments’ cost for given sizes (determined using the simulation models). For the Electricity option, this value includes the investment needed for grid connection. Such investment varies considerably between different projects, depending on the distance from the mill to the substation, the line voltage, among other system characteristics. Here, we assumed this investment as approximately 5 M US$, based on averages of recent investments in Brazil given by local specialists. c The value for Ethanol option is derived from Seabra et al. (2010). d Assumed as 5% of FCI (Aden et al., 2002). e M US$/year. f Include consumables, labor, overhead, maintenance, insurance and taxes. For the Electricity option values are estimated from EPE (2008), while for the Ethanol option, values are derived from Seabra et al. (2010). g Bagasse at 0 US$/tdry and trash at 15 US$/tdry. Cane trash is used as supplementary fuel at the mill, but its cost was entirely attributed to the adjacent plant. h 10% of FCI. i Annual sales of electricity surplus and ethanol. Ethanol price at 400 US$/m3 (value at the mill gate) and electricity price at 70 US$/MWh. These are typical values verified in the industry (Cepea, 2009). j Return on investment (ROI) was calculated here as the annual profit before income taxes (i.e., the difference between annual sales and total costs, including depreciation), divided by the total investment (i.e., FCI plus working capital).
Here, it is important to point out the uncertainties related to the cost estimate for the biochemical conversion route, since it is not a commercial technology. Moreover, even though the investment needs and operating costs are estimated for an ‘‘nth plant’’ (Aden et al., 2002), further technological developments are expected in the long run, eventually reducing capital needs and increasing yields (Laser et al., 2009a). Besides, important cost reductions may be verified for systems fully integrated to sugarcane mills, avoiding capital expenditures and increasing the utilization of the already existing installed capacity of the mill. For the Rankine-cycle system, on the other hand, significant cost reductions are not expected in the future as it is an already mature technology. In this analysis, the specific project investment was evaluated as 1085 US$/kWexported, which is comparable to values presented in other analysis (Jin et al., 2009). For the long run, however, advanced technologies based on biomass gasification integrated to combined cycles (BIG-GT/CC) might practically double the power generation efficiency compared to current commercial Rankine-cycle systems, although capital investments are expected to be as high as 1500–2000 US$/kW, for similar scales of this study (Jin et al., 2009). Fig. 4 shows the sensitivity analysis for fixed capital investment, ethanol and electricity prices and scale for both adjacent plant options. The sensitivity to biomass costs is presented separately in Fig. 5. The impacts of biomass cost variation are very different for the two technology options. Biomass represents a large fraction of annual expenses related to the Electricity option, and this option is more sensitive to the feedstock cost. For high biomass cost scenarios, ROI for the biochemical conversion plant may be even higher than in a power plant.
The biochemical conversion route is a more complex, costly technology, projected to reach greater revenues. However, for the reference (actual) cost conditions assumed in this study, higher ethanol prices are needed to yield better profitability in comparison with the Electricity alternative option. As Fig. 6 shows, for the current electricity price level (70 US$/MWh), the ethanol price must be around 490 US$/m3 to yield an equal ROI for both investment options. In this case, it is important to observe that in Brazil higher ethanol prices scenarios are more likely for the near term than higher electricity prices. The ethanol prices are defined by the market, so an increased demand for ethanol in the external market or higher gasoline prices in Brazil (both are reasonable scenarios) might lead to higher ethanol prices. Electricity from cane mills, on the other hand, is mostly bid in public auctions (along with electricity from other sources), for which maximum tariffs are established by the government. Therefore, electricity prices are not expected to rise, although recent analysis (Castro et al., 2010) has shown that modifications of the Brazilian public auctions methodology could lead to higher values for bagasse derived electricity. The suggested modifications include promoting auctions by energy source or specific auctions for the dry season base load generation.
4. GHG emissions mitigation The comparative evaluation of GHG emissions mitigation related to each technology is based on a 2020 project scenario, when biochemical conversion technology is expected to be commercially available. The parameters assumed for such scenario, defined by (Centro de Tecnologia Canavieira (CTC)) specialists, are presented in Table 5. Sugarcane production parameters are the same for both technologies, while industrial parameters are derived from the simulations presented here. In this analysis, we assumed that ethanol would be transported by truck, but in 2020 other modes for ethanol transportation (rail and pipelines) will probably play an important role in Brazil as well. These are more efficient modes and could eventually reduce ethanol life-cycle emissions. Two regression levels of energy flows were considered in the GHG emissions evaluation, in addition to field emissions: (i) the direct consumption of external fuels and electricity (direct energy inputs) and (ii) the energy required for the production of chemicals inputs in agricultural and industrial processes (e.g., fertilizers, limestone, pesticides, etc.). The emissions related to embodied energy in machinery and buildings were not accounted for, to be consistent with other analysis performed for fossil fuels. These flows are usually small and do not have significant effect on the comparative analysis (Seabra and Macedo, 2010). Carbon emissions from direct and indirect land use change (LUC and iLUC) were not included either. For the direct LUC effects, the data for the specific land use changes for sugarcane expansion in the last decade indicates that less than 2% occurred over native vegetation areas (with higher C stocks) and the overall effect may actually be of increasing the C stocks in soil (Zuurbier and van de Vooren, 2008), which is also expected for the next decade. For the iLUC, effects there is no scientific consensus on a methodology to evaluate these emissions. But the large area availability in Brazil and the intensification of the cattle raising systems, together with the current legislation, indicate that the iLUC effects could be very small (Nassar et al., 2009). The GREET 1.8c.0 model (GREET, 2009) was used to evaluate GHG emissions in the sugarcane products lifecycle, updated with the parameters presented here. We changed some default parameters (e.g., the energy consumption for limestone production) in order to better represent Brazilian conditions, as discussed in Seabra and Macedo (2010). For chemical inputs in industry, we
J.E.A. Seabra, I.C. Macedo / Energy Policy 39 (2011) 421–428
Ethanol option
40%
40%
30%
30% ROI
ROI
Electricty option
425
20%
20% 10%
10% 0% 40% 60% 80% 100% 120% 140% 160%
0% 40% 60% 80% 100% 120% 140% 160% Parameter variation
Parameter variation Ethanol price
Electricity price
FCI
Scale
Fig. 4. Sensitivity analysis for ethanol and electricity prices, fixed capital investment (FCI) and scale. Reference case (100%) as of Table 4.
Ethanol option 25%
20%
20%
15%
15%
ROI
ROI
Electricity option 25%
10%
10%
5%
5%
0%
0% 20
10
30
50
40
Bagasse at 0 US$/t dry
20
10
Cane trash cost (US$/tdry)
30
50
40
Cane trash cost (US$/tdry) Bagasse at 10 US$/t dry
Bagasse at 20 US$/t dry
Fig. 5. Sensitivity analysis of biomass cost.
700
Table 5 Projected parameters for sugarcane production in 2020.a
Ethanol price (US$/m3)
600
Units
500 400 300 200 100 0 50
60
70
80
90
Electricity price (US$/MWh) Fig. 6. Equal ROI prices for ethanol and electricity.
performed the analysis apart from GREET, based on aggregated information from Brazilian Chemical Industry Association (Abiquim, 2008). The avoided emissions were estimated considering the substitution of sugarcane products for the equivalent products in Brazil. Anhydrous ethanol substitutes for gasoline, as E22 blends to operate in gasohol dedicated cars, while bagasse-derived electricity displaces natural gas thermoelectric generation, which is the main fuel of the marginal electricity generation in Brazil (Seabra and Macedo, 2010). Since sugarcane production parameters are the same for both technology routes, the total GHG emissions resulted to be similar,
Parameter Cane productivity Harvested area % total area Total diesel consumptionb Unburned cane harvesting Mechanical harvesting Total trash yield Cane trash collection Above ground nitrogenc
t/ha % L/ha % % kgdry/t cane % g/t cane
Agr. Inputs N P2O5 K2O CaCO3
g/t g/t g/t g/t
cane cane cane cane
Value
95 90 350 100 100 140 40 992 548 32 70 4,947
a Values projected by CTC specialists. Parameters not presented here are assumed to be equal to the current averages (Seabra and Macedo, 2010). b Includes diesel consumption in all activities (sugarcane farming, harvesting, transportation, etc.). c Estimated above ground nitrogen availability related to crop and industrial residues returned to the soil. We assumed that 60% of the available trash would remain on the ground after cane harvesting.
as presented in Table 6. Small differences are observed in the sugarcane processing; in the Electricity option, greater direct emissions are verified, derived from bagasse combustion, while Ethanol option present greater emissions associated to chemicals production. For the Ethanol option, emissions from ethanol transport and distribution and fuel combustion (tailpipe emissions) are naturally greater than for the Electricity option, due to the higher ethanol yield per tonne of cane.
426
J.E.A. Seabra, I.C. Macedo / Energy Policy 39 (2011) 421–428
120
Electricity option Total emissions Sugarcane farming Trash burning Field emissions Agr. inputs production Sugarcane transportation Sugarcane processing Ethanol T&D Tailpipe emissions
Ethanol option
40.0 10.8 0.0 11.7 4.3 2.5 5.7 3.4 1.5
42.3 10.8 0.0 11.7 4.3 2.5 6.1 4.7 2.1
Avoided emissions Marginal electricity displacement Gasoline displacementb
281.8 76.6 205.1
310.2 29.7 280.5
Net avoided emissions
241.8
267.9
a b
Mill + adjacent plant. Fuel equivalence: 1.3 L ethanol/L gasoline (Seabra and Macedo, 2010).
Gasoline emissions (g CO2eq/MJ)
Table 6 GHG emissions balance for the sugarcane biorefinerya (kg CO2eq/t cane).
100 80 60 40 20 0 400
500
600
700
800
900
1000
Marginal electricity emissions (kg CO2eq/MWh) Fig. 7. Lifecycle emissions for gasoline and marginal electricity to yield equal net avoided emissions.
Table 7 GHG emissions balance for the adjacent plant (kg CO2 eq/t dry bagasse). Electricity option Total emissions Bagasse ‘‘production’’a Bagasse processing Ethanol T&D Tailpipe emissions
Ethanol option
148 120 28
173 120 33 14 6
Avoided emissions Marginal electricity displacement Gasoline displacement
641 641
955 122 833
Net avoided emissions
493
781
a Part of the sugarcane production emissions was allocated to the surplus bagasse, based on the energy content of mill’s products (ethanol, electricity and bagasse surplus). Ethanol and bagasse energy flows were calculated using the respective lower heating values, and for electricity, we considered a heat rate of 9 MJ/kWh.
Despite the additional emission sources, the Ethanol option is able to mitigate more GHG emissions. This environmental advantage is stressed in Table 7, which presents the emissions balance related only to the adjacent plants. In this table, only the inputs and outputs of the adjacent plant are considered (i.e., the ethanol and electricity produced at the mill are not taken into account). Since a biorefinery concept is involved, with the production of multiple products, a procedure was adopted to allocate the upstream emission burdens among the products from the mill and the adjacent plant. Emissions derived from cane production were allocated based on the energy content of mill’s products (ethanol, electricity and bagasse surplus), leading to the ‘‘bagasse production’’ emissions. Alternatively, emissions credits from the coproducts could be assigned to the main product using a system expansion method. Though avoided emissions by the displacement of NG thermoelectricity are significant (even for the Ethanol option), the benefits of ethanol substitution for gasoline determines the preference for the liquid fuel production. Nevertheless, power generation is preferred if more carbon intensive fuels (coal, for instance) are considered for the marginal electricity generation, as illustrated in Fig. 7. Similarly to the economics, these results are sensitive to the products yields (net avoided emissions and yields have a practically linear relationship), and differences in the assumed process efficiencies may change the final results. For different biorefinery concepts (and feedstocks) producing ethanol (or other biofuel), the comparison between the emissions
mitigation promoted by ethanol with respect to gasoline is frequently used. In many cases, the conclusions about which option promotes the greater mitigation are difficult: co-products credits can result in apparently greater benefits than higher ethanol yields, since emissions are evaluated per cubic meter of fuel. For the cases evaluated here, for instance, ethanol life-cycle emissions would be 19 and 5 g CO2eq/MJ, respectively for the Electricity and Ethanol options. The electricity option apparently presents a better environmental performance essentially because more credits are assigned to ethanol, while less fuel is produced per tonne of cane. Therefore, comparisons leveled by the feedstock, or preferably by unit of land area, are more appropriate to evaluate the overall benefit.
5. Energy policies and the decision: ethanol or electricity from bagasse and trash? Energy policies which may lead to decisions on producing more electricity or more ethanol from cane residues will probably be essentially local, Brazilian policies rather than global initiatives like the Clean Development Mechanism (CDM) or carbon taxes. The context for the Brazilian sugarcane industry shows a strong growth: 387 Mt cane/year, in 2005/2006; 564 Mt in 2008/ 2009, and projected 1100 Mt cane/year, in 2020 (UNICA, 2010). Sugar production will take 30% of the cane in 2020 (against 40% today); ethanol (as fuel for internal market and exports, and less than 10% for industrial uses including plastics production) will use the largest portion (EPE, 2010). All uses will provide surplus bagasse and trash for electricity (or ethanol). Since 2002 a large number of mills is being built, and the decision to produce more electricity is made at this point, involving the adoption of higher pressure boilers, condensation capacity, turbines and generators. The experience to date shows that: 1. There have been no significant government policies to promote (or support) ethanol since 1990. The only policy remaining from the Pro-Alcool program is the mandatory 20–25% blend with gasoline (which accounts for a relatively small portion of the ethanol used). Ethanol became competitive with gasoline at relatively low oil prices (BNDES, CGEE, 2008). Growth has been assured by technological innovation (like the flex-fuel car, today).
J.E.A. Seabra, I.C. Macedo / Energy Policy 39 (2011) 421–428
2. Ethanol is not considered eligible for any carbon credit (like CDM, for instance). Surplus electricity is eligible, but the values paid are not significant (today) to lead to a positive response from the investors. 3. Today the technology for producing electricity is commercial, well known in Brazil, and the extra cost for a new mill to incorporate it is acceptable. The technologies for 2nd generation ethanol are not available, and they may not become fully tested, commercial, before 2015 in Brazil (Seabra, 2008). Even then, the ethanol costs may be higher than the 1st generation ethanol. This means: it may need subsidies for some time, and this will be very difficult to obtain in Brazil. 4. The most important point: the Brazilian electricity supply system is 85% from hydro power; the 15% from thermal power complements the demand (for both the Integrated and Isolated systems). Projections (EPE, 2009) indicate that from 2008 to 2017 the installed capacities for hydroelectricity will decrease from 81.9% to 70.9%, increasing in fuel oil-based power (0.9 to 5.7%). The affluent energy for hydroelectricity is highly seasonal: in the dry season it drops to 30–40% of the rain season (Castro et al., 2010). New hydro units have much smaller water reservoirs: in 1970 the reservoirs corresponded to 28 months of operation, and in 2008 only 6 months. This leads to increasing dispatch of thermal power to help the supply system. The bagasse based units are inflexible thermal based systems (they are always dispatched). They are in the lowest range of CVU (unit variable cost) for the thermal systems (Castro et al., 2010). The bagasse based power generation happens in the dry season (May–November), in complementation to the hydro affluent energy. 5. For the reasons above, the Brazilian government started (a few years ago) to promote the use of bagasse-generated electricity. This includes long-term contracts (15 year), lower interest rates in financing equipment specific for higher efficiency in power generation in cane processing units, specific auctions to buy energy from renewable sources, and more recently adapting the distribution systems to receive power from the mills. There is a rapidly increasing number of mills planning for increased generation, and all the new mills are designed to do it. At this moment, it appears that the availability of technology, the need for thermal complementation of the electricity supply and the specific policies adopted by the Brazilian government define the trend we will see in the decade.
6. Conclusion Sugarcane residues are one of the main feedstock options for the future biomass conversion technologies. Today, the only commercial option is electricity generation through conventional steam cycles, which represents an attractive business option for Brazilian sugarcane mills. For the near-future, the biochemical conversion of ligno-cellulosic materials into ethanol will probably raise as an important alternative. This work compared the technical, economic and environmental (GHG emissions mitigation) performance of power generation and ethanol production from sugarcane bagasse, considering the technology alternatives for the near-term. Simulated performances presented here indicate that ethanol production in a projected enzymatic saccharification co-fermentation system would lead to greater energy outputs compared to electricity generation in commercial steam-Rankine systems. The profitability of the biochemical conversion plant would not be favorable in comparison to the power plant for the reference values adopted here. Despite the higher revenues, estimated investment
427
needs and annual expenses for the Ethanol option would be far greater than the values for the conventional power plant, resulting in a considerably lower return on investment (ROI). The economics for the biochemical conversion may improve as technology advances, leading to lower capital needs and greater yields; and better integration of these systems with the sugarcane mill may also improve results even in the short-term. The sensitivity analyses show that the biomass cost has a significant impact on the economic performance, especially for the Electricity option. For high bagasse (or trash) costs the return on investment for the Electricity option would be lower than for the Ethanol option. For the baseline conditions assumed here, the environmentally preferred option, with respect to GHG emissions mitigation, is the biochemical conversion route. Ethanol substitution for gasoline leads to greater emissions mitigation than the displacement of the natural gas thermoelectricity by bagasse derived electricity. In this case, the establishment of a carbon market embracing fuel ethanol can improve the biochemical conversion route competitiveness, even though the necessity to rapidly expand the power generation capacity in Brazil is also an important factor to be considered in this comparison.
Acknowledgements The authors thankfully acknowledge UNICA for helping in the revision of this work. Specialists of the Centro de Tecnologia Canavieira (CTC) are also gratefully acknowledged for the data provision and assistance in the analysis. Discussion with specialists from the Argonne National Laboratory (IL, USA) and the National Renewable Energy Laboratory (CO, USA) in the context of the Brazil-USA bilateral collaboration on advanced biofuels was also very important for this work. References ~ de ga´s carboˆ nico e consumo de Abiquim, 2008. Indu´stria quı´mica reduziu emissoes a´gua. Comunicac- a~ o Abiquim (Associac- a~ o Brasileira da Indu´stria Quı´mica), 18 de Junho, Sa~ o Paulo, Brasil. Aden, A., Ruth, M., Ibsen, K., Jechura, J., Neeves, K., Sheehan, J., Wallace, B., Montague, L., Slayton, A., Lukas, J., 2002. Lignocellulosic biomass to ethanol process design and economics utilizing co-current dilute acid prehydrolysis and enzymatic hydrolysis for corn stover. National Renewable Energy Laboratory; Golden (CO): June 2002. Report No.: TP-510-32438. BNDES, CGEE (coordination), 2008. Sugarcane-based ethanol: energy for sustainable development. Rio de Janeiro: BNDES, 304p. Botha, T., von Blottnitz, H., 2006. A comparison of the environmental benefits of bagasse-derived electricity and fuel ethanol on a life-cycle basis. Energy Policy 34, 2654–2661. Castro, N.J., Branda~ o, R., Dantas, G.A., 2010. Importˆancia e perspectivas da bioeletricidade sucroenerge´tica na matriz ele´trica brasileira. In: Souza, E.L., Macedo, I.C. (Eds.), Etanol e bioeletricidade: a cana de ac-u´car no futuro da Matriz energe´tica. Luc Projetos de Comunicac- a~ o Ltda., Sa~ o Paulo, pp. 2010. Cepea, 2009. Centro de Estudos Avanc- ados em Economia Aplicada. /www.cepea. esalq.usp.brS. Dedini Indu´strias de Base. 2009. /www.dedini.com.brS. o EPE, 2008. 1 % Leila~ o de energia de reserva – 2008: Definic- a~ o do prec- o inicial. No. EPEDEE/DEN-067/2008-r4, 15 de julho de 2008. Empresa de Pesquisa Energe´tica, Rio de Janeiro, RJ. EPE, 2009. Plano decenal de expansa~ o de energia 2008/2017. Ministe´rio de Minas e Energia. Empresa de Pesquisa Energe´tica. EPE, Rio de Janeiro,. EPE, 2010. Plano decenal de expansa~ o de energia 2019. Ministe´rio de Minas e Energia. Empresa de Pesquisa Energe´tica. MME/EPE, Brası´lia,. Faaij, A.P.C., 2006. Bio-energy in Europe: changing technology choices. Energy Policy 34, 322–342. GREET, 2009. The Greenhouse Gases, Regulated Emissions, and Energy Use in Transportation Model. Software: GREET 1, Version 1.8c.0. UChicago Argonne, LLC. Humbird, D., Aden, A., 2008. FY08 state of technology update. Internal NREL Milestone Completion Report. National Renewable Energy Laboratory, October 30, Golden, CO, USA. Jin, H., Larson, E.D., Celik, F.E., 2009. Performance and cost analysis of future, commercially mature gasification-based electric power generation from switchgrass. Biofuels, Biorproducts & Biorefining 3, 142–173.
428
J.E.A. Seabra, I.C. Macedo / Energy Policy 39 (2011) 421–428
Laser, M., Jin, H., Jayawardhana, K., Lynd, L.R., 2009a. Coproduction of ethanol and power from switchgrass. Biofuels, Bioproducts & Biorefining 3, 195–218. Laser, M., Larson, E., Dale, B., Wang, M., Greene, N., Lynd, L.R., 2009b. Comparative analysis of efficiency, environmental impact, and process economics for mature biomass refining scenarios. Biofuels, Bioproducts & Biorefining 3, 247–270. o NAE, 2005. Biocombustı´veis. Cadernos NAE n % 2 (Jan. 2005). Brası´lia: Nu´cleo de Assuntos Estrate´gicos da Presidˆencia da Repu´blica, Secretaria de Comunicac- a~ o de Governo e Gesta~ o Estrate´gica. Nassar A.M., Harfuch L., Moreira M.M.R., Bachion, L.C., Antoniazzi, L.B., 2009. Impacts on land use and GHG emissions from a shock on Brazilian sugarcane ethanol exports to the United States using the Brazilian land use model (BLUM). Report to the U.S. Environmental Protection Agency regarding the Proposed Changes to the Renewable Fuel Standard Program. Institute for International Trade Negotiations (ICONE), September 2009. Kartha, S., Larson, E.D., 2000. Bioenergy primer: Modernised biomass energy for sustainable development. United Nations Development Programme (UNDP). Leal, M.R.L.V., Macedo, I.C., 2004. Evoluc- a~ o tecnolo´gica dos sistemas de gerac- a~ o de energia nas usinas de ac- u´car e a´lcool. Biomassa & Energia 1 (3), 245–253. Seabra, J.E.A., 2008. Technical-economic evaluation of options for whole use of sugar cane biomass in Brazil. Campinas, Faculdade de Engenharia Mecˆanica, Universidade Estadual de Campinas (Unicamp). PhD thesis, 274p.
Seabra, J.E.A., Macedo, I.C., 2010. Lifecycle assessment of Brazilian sugarcane products: GHG emissions and energy use. Report to UNICA, Sa~ o Paulo. Seabra, J.E.A., Tao, L., Chum, H.L., Macedo, I.C., 2010. A techno-economic evaluation of the effects of centralized cellulosic ethanol and co-products refinery options with sugarcane mill clustering. Biomass and Bioenergy 34, 1065–1078. UNICA, 2009. Supporting information provided to CARB on a Confidential Business Information’’ basis in June 2009. ’’Comment submitted by Brazilian Sugarcane Industry Association (UNICA), Document ID EPA-HQ-OAR-2005-0161-1761.1. Letter to Environmental Protection Agency, Docket EPA-HQ-OAR-2005-0161. Washington, DC. UNICA, 2010. Unia~ o da Indu´stria de Cana-de-ac-u´car. /www.unica.com.brS. Retrieved on January 2010. U.S. DoE, 2009. Department of Energy, Washington, US /www.energy.govS. Walter, A., Llagostera, J.I., Ensinas, A.V., Maio, D.S., Reis, M., Leme, R.M., 2005. Levantamento do Potencial Nacional de Produc- a~ o de Eletricidade nos Segmentos Sucro-alcooleiro, Madeireiro e em Usinas de Beneficiamento de Arroz. Parte I. Relato´rio para PNUD/MME. NIPE/Unicamp, Campinas, Brasil. Zuurbier, P., van de Vooren, J. (Eds.), 2008. Sugarcane ethanol: Contributions to climate change mitigation and the environment. Wageningen Academic Publishers, The Netherlands, 255p.