THE IMPORTANCEOF BIOFUELS
Workshop & Business ForumSustainable Biomass Production for the
World Market, Unicamp, 02/12/05
Luiz Carlos Corrêa CarvalhoBrazilian Sugar and Ethanol
Sectorial Chamber -Ministry of Agriculture,
Pasture and Supply
SINERGY: SINERGY: FOSSILFOSSIL vsvs RENEWABLE FUELSRENEWABLE FUELS
EFFICIENCY INEFFICIENCY INNATURAL GASNATURAL GAS
USEUSE
EFFICIENCY INEFFICIENCY INOIL USEOIL USE
GHG REDUCTIONGHG REDUCTIONIN OIL ANDIN OIL AND
NATURAL GASNATURAL GASUSEUSE
TO EXPAND THEBIOENERGY PRODUCTION
AND USE
EFFICIENCY INBIOENERGY USE
CARBON UPTAKEBY RENEWABLE
FUELS
The challenge of Peak Oil
Source: Chris Skrebowski, The End of Oil – Conference, London, 11th october 2005
• Our economies are totally oil dependent
• Economic progress requires growth
• Growth requires oil, preferably cheap oil
• Fuel changes require time and large investments which in turn require energy
• What is at risk? History shows us that supply shortfalls lead to high oil prices and high oil prices lead to economic recessions
Why does ‘Peak Oil’ matter?• Our economies are totally oil dependent• Economic progress requires growth• Growth requires oil, preferably cheap oil• Fuel changes require time and large
investments which in turn require energy • What is at risk? History shows us that supply
shortfalls lead to high oil prices and high oil prices lead to economic recessions
Source: Chris Skrebowski, The End of Oil – Conference, London, 11th october 2005
The depletion challenge
Source: Chris Skrebowski, The End of Oil – Conference, London, 11th october 2005
A visual summary
0
20000
40000
60000
80000
100000
2005
2006
2007
2008
2009
2010
2011
2012
New fields
Decliningproduction
Source: Chris Skrebowski, The End of Oil – Conference, London, 11th october 2005
Gas discovery is also falling short
• Gas discovery peaked in 1970s• Demand first exceeded discovery in 1985
then continuously from 1990 to 1995• Since 2001discovery has been under half
of usage• Gas production is already falling in the
USA, Canada, UK, Germany, Italy and New Zealand
goal
GDP & ENERGY PER CAPITA : GOALS FOR DEVELOPING COUNTRIES
Tem
pera
ture
Cha
nge
(ºC
)N
orth
Hem
isph
ere
CO
2 in Atmosfere
CO2 LEVELS
TºC
TºC Restab
THE EVOLUTION OF THE CAR,SINCE THE XX CENTURY UNTIL THE HIDROGEN ERAANDTHE DIRECT CORRELATIONBETWEEN CAR, CARBON EMISSIONS AND GREENHOUSEEFECT
Oil dominates its markets• 80-95% of all transport is fuelled by oil products
• 70-75% of all oil is used for transportation
• All petrochemicals are produced from oil
• 99% of all lubrication is done with oil products
• 95% of all goods in the shops get there using oil
• 99% of our food involves oil or gas for fertilisers, agrochemicals, tilling, cultivation and transport
Source: Chris Skrebowski, The End of Oil – Conference, London, 11th october 2005
Delaying ‘Peak Oil’• Economic slowdown/recession• Demand destruction via high prices • Middle East opening to investment• Peace in Iraq…..etc• But, accelerating projects produces
cost inflation rather than more oil• Systems working better than expected
• Biofuels
BIOFUELS APPROACH
1. May be easier to market than other alternative fuels,considering performance, infrastructure, and other factors;
2. Can play a significant role in climate change policy and in measures to reduce GHG;
3. Important increase in production and use, supported by government policies;
4. Largely agriculture – driven ( more than by energy concerns );
5. Positive impacts for rural economy6. Potential to be commodity, increasing benefits and
lowering costs.
RENEWABLE ENERGY TODAY
TWO PRINCIPAL GOALS:• POVERTY ALLEVIATION• CLIMATE CHANGE MITIGATION
To give access to reliable,affordable and environmentallysafe energy services
To protect the globalenvironment, in the context of climate changefrom fossil fuel combustion
To correct To decarbonize
Source: Enrique Iglesias, President, Inter-American Development Bank, InternationalKonferenz für Erneuerbare Energien, Bonn, 03/06/04
WORLD: WORLD: PERSPECTIVES FOR RENEWABLE ENERGYPERSPECTIVES FOR RENEWABLE ENERGY
% TOTAL YEAR13,5 200520,0 2030
>30,0 2050
Intensity and availability of renewable sources;Maturity of renewable’s technology;Market rules and government
Rick Sellers, IEA, 2005
4 IMPORTANT FACTORS:
AGRICULTURE IMPACTS WITH BIOMASSPRODUCTION
FOR ENERGY PURPOSES
“ 6 EJ WILL BE THE AMOUNT OFLOW-COST ETHANOL ( 240 BI LTS)
THAT COULD BE PRODUCED GLOBALLYWITH THE LARGEST PRODUCTION OFSUGARCANE IN BRAZIL AND INDIA “
Source :IEA, 2004
Ethanol Acumulated Production ( 1000 m3 )
ETHANOL AND THE REAL BRAZILIAN LEARNING CURVE
Source: Goldemberg,J. & Macedo,I., 2005
MarketConditions
market (ethanol prices)
market (Rotterdam-Gasoline price)
(50 new )
N/NE -126C/S - 219TOTAL- 345
IND. UNITS
ETHANOL AND BIODIESEL SINERGIES
FOSSIL
FUEL
ELETRIC
ENERGY
FOOD
BIOFUELS
•IS THERE ANY MARKET RELATION BETWEEN BOTH AGRICULTURES ?
•IS THERE LAND AVAIABLE?
FOOD AND ENERGY
PRICE’S EQUIVALENCE : SUGAR AND GASOLINE
Sugar inEthanolEquivalent
Gasoline - Nymex
IFIF10% ETHANOL IN GLOBAL DEMANDED GASOLINE (10% ETHANOL IN GLOBAL DEMANDED GASOLINE (blendsblends))
Ex.3. All countriesNecessary ethanol volume:116,0 Billion Litres(actual soybean area in Brazil)
Ex. 1. Developing countries and Non OECD countriesNecessary ethanol volume:32,7 billion litresBase Brazil......necessary area: 5,6 million ha(actual sugarcane area in Brazil)
Ex. 2. OECD countriesNecessary ethanol volume:84,0 billion litresBase Brazil......necessary area: 14,4 million ha
Recent WTO Initiatives Affecting Biofuels
At the Doha Ministerial meeting of the WTO in Cancun, September 2003, the declaration called for negotiations on “the reduction or, as appropriate, elimination of tariff and non-tariff barriers to environmental good and services”. Negotiations will continue and biofuels may be included in future lists of environmental goods and services for which tariff reductions are negotiated.
Planning justified?
“When Noah built the ark….…………
………..it wasn’t raining”
Source: Chris Skrebowski, The End of Oil – Conference, London, 11th october 2005
•
TRANSPORTATION SECTORSUSTAINABILITY AS A GLOBAL ACTTITUDE
