july 29, 2008 – san juan, puerto rico biodiesel production ......argentina resolution 129...

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Biodiesel Production in South America Biodiesel Production in South America CONGRESO LATINOAMERICANO DE QU CONGRESO LATINOAMERICANO DE QU Í Í MICA MICA Biofuels Biofuels and and Biobased Biobased Products Symposium Products Symposium July 29, 2008 July 29, 2008 San Juan, Puerto Rico San Juan, Puerto Rico Luiz Pereira Ramos Luiz Pereira Ramos CEPESQ Research Center in Applied Chemistry Department of Chemistry, UFPR [email protected]; www.quimica.ufpr.br/lramos

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Page 1: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

Biodiesel Production in South America

Biodiesel Production in South America

CONGRESO LATINOAMERICANO DE QUCONGRESO LATINOAMERICANO DE QUÍÍMICAMICABiofuelsBiofuels and and BiobasedBiobased Products SymposiumProducts Symposium

July 29, 2008 July 29, 2008 –– San Juan, Puerto RicoSan Juan, Puerto Rico

Luiz Pereira Ramos Luiz Pereira Ramos

CEPESQResearch Center in Applied Chemistry

Department of Chemistry, UFPR [email protected]; www.quimica.ufpr.br/lramos

Page 2: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

BIOFUELS MOTIVATIONBIOFUELS MOTIVATIONIssues

Availability of a large variety of renewable lipid sourcesLarge availability of land for farmingEconomy largely dependent on dieselDiesel consumption partially imported from abroadOil refining facilities near to their limitHigh energy demand (electricity) in remote areasDecreasing air quality in largely populated urban areasNeed for increasing job availability in the countrysideWell established agro-industrial activities

Page 3: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

BIOFUELS MOTIVATIONBIOFUELS MOTIVATIONGoals

Better income distributionBenefit to local producers New jobs in the countrysideBetter quality of living in remote areasEnergy made available throughout the regionLower environmental impact in energy productionNew market opportunities for agribusinessReduction in petrodiesel consumption and importsImprovement of air quality in urban areas (externalities)

Page 4: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008CLAQ, San Juan, 2008

Argentina, Bolivia, Argentina, Bolivia, BrasilBrasil, Chile, Colombia, , Chile, Colombia, EquadorEquador, , Paraguay, Peru, UruguayParaguay, Peru, Uruguay

Government Decrees to promote biofuels production and useDecrees to regulate the internal market and exportationResolutions establishing national biodiesel standardsMultilateral agreements among SA countries and abroadLaws defining incentives for local producersResolutions defining policies for tax exemption and subsidiesLaws providing rules for the general use of neat biodiesel and blends

BIODIESEL IN SOUTH AMERICAPresent situationBIODIESEL IN SOUTH AMERICAPresent situation

Page 5: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008CLAQ, San Juan, 2008

Country Documentation Title DateArgentina Decree 1396 Establishment of 10-years tax incentives for biodiesel producers 01/11/2001Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001Argentina Law 26093 Promotion of biofuels production and use 15/05/2006Argentina Decree 109-20 Regulations for biofuels production and use 13/02/2007

Bolivia Law 3152 Definition of new sources of alternative energy 03/08/2005Bolivia Law 3279 Definition of new sources of alternative energy 09/12/2005Bolivia Law 3207 Definition of incentives for biodiesel producers 30/09/2005Brazil Resolution 007 National Energy Commission creates of the 1st biodiesel program 22/10/1980Brazil Decree 702 Official launching of the Probiodiesel Program 30/10/2002Brazil Decree ANP 255 Definition of the preliminary national biodiesel standard 19/03/2003

Brazil Law 11.116 Federal registry for biodiesel producers and dealers 18/05/2005Brazil Resolution ANP 7 Adjustments to the national biodiesel standard 19/03/2008

Brazil Decree 5.297 Definition of federal tax incentives for biodiesel producers 06/12/2004Brazil Resolution ANP 42 Definition of the national biodiesel standard 09/12/2004Brazil Law 11.097 Reestablishment of the national biodiesel program and other measures 13/01/2005Brazil Decree 5.448 Introducing biodiesel blends (B2) in the national energy matrix 20/05/2005

BIODIESEL IN SOUTH AMERICABIODIESEL IN SOUTH AMERICA

Page 6: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008CLAQ, San Juan, 2008

Country Documentation Title DateBrazil Resolution ANP 2 Adjustments to the authorization criteria for B100 and biodiesel blends 29/01/2008Brazil Resolution CNPE 2 Increasing the biodiesel blend level to B3 in the national energy matrix 13/03/2008Brazil Decree 6.458 Adjustments to federal tax incentives for biodiesel producers 14/05/2008

Colombia Law 939 Dispositions about biofuels 31/12/2004Colombia Law 1028-2006 Changes in the Penal Code 12/06/2006Colombia Decree 3492 Dispositions about biofuels production and use 13/09/2007Colombia Law 939 Dispositions about biofuels 31/12/2004Ecuador Decree 2332 Promotion of biofuels production, use and commercialization 02/12/2004Paraguay Law 2.748-05 Promotion of biofuels production and use 07/10/2005Paraguay Decree 7.412-06 Regulations to promote the biofuels market 27/04/2006Paraguay Resolution MIC235 Regulations and definitions about biodiesel blends 26/04/2007

Peru Law 28054 Promotion of biofuels use and commercialization 08/08/2003Peru D.S. 013-2005-EM Regulations and other measures to promote the market for biofuels 31/03/2005Peru Decree DS-021 Rules for commercializing biofuels 20/04/2007

Uruguay Law 17.567 Promotion of biofuels production and use 01/10/2002Uruguay AAA. PC. Nº 19 Multilateral agreement among Mercosul countries 09/12/2005

BIODIESEL IN SOUTH AMERICABIODIESEL IN SOUTH AMERICA

Page 7: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

B5 in 2008B10 in 2010B20 in 2012

B2 in 2008 authorizedB2 in 2011 mandateB5 in 2012

B5 in 2014

B20 & B100 authorizedB2 in 2009 mandateB5 in 2011 mandate

B5 in 2010International trading

B2 in Jan 2008 mandateB5 in Jan 2008 authorizedB3 in Jul 2008 mandateB5 in 2013 mandate

B1 in 2007 mandateB3 in 2008 mandateB5 in 2009 mandate

B2.5 in 2007B20 in 2017

International trading

Page 8: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

Biodiesel specifications ANP 7 UNIT 1100 Decree 11 IRAM 6515 ASTM 6751-- --

860-9003.5-5.0

--120 min0.05 max96.5 min0.02 max

0.005 max

No. 2 max------

0.50 max--

0.20 max0.02 max0.25 max

------

6 min--

5 max5 max

------

875-9003.5-5.0

0.05 max130 min0.05 max96.5 min0.02 max

0.001 max

No. 1 max47 min

----

0.50 max150 max0.20 max0.02 max0.25 max0.80 max0.20 max0.20 max

6 min10 max

1.9-6.0

5 max

--1.9-6.0

0.05 max130 min0.05 max

--0.02 max0.05 max

0.0015 maxNo. 3 max

47 min--

360 max0.50 max

----

0.02 max0.24 max

------

3 min10 max5 max

0.05 max100 min0.01 max96.5 min

--

--

No. 3 max45 min

----

0.80 max--

0.20 max0.02 max0.25 max0.80 max0.20 max0.20 max

6 minReport10 max

-- 5 max5 max

EN 14214Aspect -- --Specific gravity (kg/m3) 850-900, 20°C 860-900Kinematic viscosity, 40ºC (mm2/s) 3.0-6.0 3.5-5.0Water and sediments (%) 0.05 max 0.05 maxFlash point (ºC) 100 min 101 minCarbon residue (%, m/m) 0.05 0.03 max

Distillation recovery, 90% (oC) -- (95%) 360 max

Phosphorus (mg/kg) 10 max 10 maxSodium + Potassium (mg/kg) 5 max 5 maxCalcium + Magnesium (mg/kg) 5 max 5 max

Ester content (%, m/m) 96.5 min 96.5 minSulfated ash (%, m/m) 0.02 max 0.02 max

Sulfur (%, m/m) 0.05 max 0.001 max

Copper corrosion for 3h at 50ºC No. 1 max No. 1 maxCetane number Report 51 minCFPP for ANP (oC) 19oC max --

Acid number (mg KOH/g) 0.50 max 0.50 maxIodine number Report 120 maxAlcohol (%, m/m) 0.20 max 0.20 maxFree glycerin (%, m/m) 0.02 max 0.02 maxTotal glycerin (%, m/m) 0.25 max 0.25 maxMonoacylglycerides (%, m/m) Report 0.80 maxDiacylglycerides (%, m/m) Report 0.20 maxTriacylglycerides (%, m/m) Report 0.20 maxOxidation stability at 110oC (h) 6 min 6 min

Methyl linolenate (%, m/m) -- 12 max -- 12 max -- 12 max.

Poly-unsaturated FAME (% m/m) -- 1 max -- -- -- 1 max.

Total contamination (mg/kg) 24 -- 24

Cloud point (oC) -- -- -- -- Report --

Flash point (closed cup) (oC) -- -- -- -- 93 min --

Page 9: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008

Biodiesel quality issuesBiodiesel quality issues

Challenges yet to be overcomeChallenges yet to be overcomeEnsure good quality in small scale production unitsEstablish suitable methods for quality control in small scaleValidate the current standard methods (or develop new ones) for biodiesel derived from alternative lipid sourcesDetermine biodiesel storage stability in field testsImprove biodiesel properties such as cold flow (cloud, pour and cold filter plugging points) and oxidation stabilityDevelop suitable strategies for distribution and blendingHarmonize biodiesel standards throughout the region

Page 10: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008

Page 11: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008Source: National Energy Balance (BEN, 2007)Ministry of Mines and Energy (MME)

44,8% 44,8% renewablesrenewables

225,8 225,8 millionmillionTEPTEP

Biomass

Hydroelectricity

Uranium

Coal

Natural gas

Petroleum

Sugarcane

Other renewables

Brazilian energy matrixBrazilian energy matrix

Page 12: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008

44.8% 44.8% renewablerenewable

225.8 225.8 millionmillionTEPTEP

0

20

40

60

80

100

World Brasil

Renewable Non-renewableSource: National Energy Balance (BEN, 2007)Ministry of Mines and Energy (MME)

Brazilian energy matrixBrazilian energy matrix

Page 13: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008

Diesel26.1%

B225.1%

Gasoline A*23.4%

GNV3.4%

Ethanol Hydrated13.8%

Ethanol Anhydrous8.3%

48.9% in 200648.9% in 2006

27.2% in 200627.2% in 2006

3.3% in 20063.3% in 2006

3.2% in 20063.2% in 2006

9.9% in 20069.9% in 20067.3% in 20067.3% in 2006

Diesel (Total)Diesel (Total)26.1 + 25.1 =26.1 + 25.1 = 51.2%51.2%52.2% in 200652.2% in 2006

GasolineGasoline CC23.4 + 8.3 =23.4 + 8.3 = 31.7%31.7%34.5% in 200634.5% in 2006

EthanolEthanol (Total)(Total)8.3 + 13.8 =8.3 + 13.8 = 22.1%22.1%17.2% in 200617.2% in 2006

Brazilian energy matrixBrazilian energy matrix

Page 14: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008

Matriz energéticaMatriz energética(1)

Production Consumption NetImports

NetExports

1000 m3 % demand % production

GASOLINE A 21.569 17.624 - 3.964 18%

DIESEL OIL 38.707 43.050 4.343 - 10%

ETHANOL 22.557 19.027 - 3.530 16%

FUEL OIL 15.189 9.584 - 5.605 37%

QUEROSENE 3.986 4.822 836 - 17%

NATURAL GAS(million m³/day) 21.5 47.8 26.3 - 55%

Fuel1000 m3 1000 m3 1000 m3

NetImports

NetExports

Self-sufficiencySelf-sufficiencyDependencyDependency

Brazilian energy matrixBrazilian energy matrix

Source: National Energy Balance (BEN, 2007)Ministry of Mines and Energy (MME)

Page 15: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

Main PNPB guidelines: • To implement a sustainable program, focused in promoting social inclusion; • To promote and/or guarantee biodiesel competitiveness, quality and supply; • To produce biodiesel from different oil bearing materials in different regions of the country

Page 16: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

Biodiesel definitionBiodiesel definition

BiodieselBiodiesel is any biomassis any biomass--derived derived biofuelbiofuel that can be use that can be use for the partial or complete replacement of petroleum diesel for the partial or complete replacement of petroleum diesel in compression ignition engines. in compression ignition engines.

Therefore, biodiesel can be: • Crude vegetable oils• Oil/diesel binary mixtures • Alcohol/diesel binary mixtures • Micro-emulsions• Biomass pyrolysates• Vegetable oil pyrolysates (bio-oil)• Alcohol/diesel/co-solvent ternary mixtures

Fatty acid alkyl estersFatty acid alkyl esters are are the only biodiesel type that is the only biodiesel type that is already regulated in Brazil.already regulated in Brazil.

Page 17: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

Brazilian National ProgramBrazilian National Program

• Assessment of raw materials available regionally• Evaluation of their suitability for biodiesel production• Incentive to cooperative efforts involving small producers • Identification of potential biodiesel suppliers • Development of small scale production units• Insertion of the biodiesel concept in rural settlements • Evaluation of biodiesel performance in field tests• Incentive to industrial and/or technological innovation

Law 11097 of January 13, 2005 B2 in 2005B5 in 2008mandatory

revision in 2013

B2 in 2005B5 in 2008mandatory

revision in 2013

Page 18: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

Mandatory use of biodiesel blends since Jan 2008Higher blends only allowed under special conditionsLarge scale producers must be authorized by ANPBlending allowed only in authorized refineries and fuel distributorsQuality certificate(s) must be issued or validated by ANP Fuel source is traceable by addition of chemical markersQuality control beyond distribution based on typical diesel analysis (aspect, color, specific gravity and flash point) B2 must comply to the national spec for diesel oil (ANP 310)

Important highlightsImportant highlights

Brazilian National ProgramBrazilian National Program

Page 19: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

voluntary mandatory

RegulatoryRegulatory ActActLawLaw 11097/0511097/05

B2B2

B5B5

800.000 t800.000 t

2.000.000 t2.000.000 tvoluntary mandatory

Jan 2005 Jan 2008 Jan 2013

Brazilian National ProgramBrazilian National ProgramMilestonesMilestones

Page 20: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

voluntary mandatory

RegulatoryRegulatory ActActLawLaw 11097/0511097/05

B2B2

B5B5

800.000 t800.000 t

2.000.000 t2.000.000 tvoluntary mandatory

Jan 2005 Jan 2008 Jan 2013

1.200.000 t in July 2008

Brazilian National ProgramBrazilian National ProgramMilestonesMilestones

Page 21: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

voluntary mandatory

RegulatoryRegulatory ActActLawLaw 11097/0511097/05

B2B2

B5B5

800.000 t800.000 t

2.000.000 t2.000.000 tvoluntary mandatory

Jan 2005 Jan 2008 Jan 2013

1.200.000 t in July 2008

2.000.000 t in January 2010

Brazilian National ProgramBrazilian National ProgramMilestonesMilestones

Page 22: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

Market rulesMarket rules

Agricultural chainPlantation Crushing

Grains Oil

Cake, meal...

Consumers

Distributor Dealers

Refinery

B2 B2

Consumers

DIRECT COMMERCIALIZATION

NOT ALLOWED

GlycerinAlcohol

Biodiesel producer

B100

B100

B100

Source: MCT, ANP

Page 23: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

Tax incentivesTax incentives

BIODIESEL

FEDERAL TAXES

Family agriculture in

the northern or northeastern

regions(castor & palm)

Family agriculture in general

Intensive agriculture in

the northern and northeastern

regions(castor & palm)

General ruleDIESEL

CIDE Inexistent Inexistent Inexistent Inexistent 0.070

PIS/COFINS100%

reduction68%

reduction32%

reduction0.218

0.218

0.148

Total federal taxes

100%reduction

68%reduction

32%reduction

0.218

Page 24: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

Social Fuel SealSocial Fuel Seal

Granted to biodiesel producers who:

• Purchase raw materials from family agriculture• Sign contracts with local farmers (family agriculture) • Provide technical assistance and support to local farmers

Benefits for biodiesel producers:

• Exemption of federal taxes proportionally to their purchases• Access to better financing plans• Participation in public biofuel auctions (sales guaranteed)• Better commercial profile (improves competitiveness)

Page 25: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

ANP auctionsANP auctions

Promoted AuctionsPromoted Auctions DateDate SoldSold (10(1066 L)L) AverageAverage PricePriceFirstFirst auctionauctionSecondSecond auctionauctionThirdThird auctionauctionFourth auctionFourth auctionTotalTotal

23/11/200523/11/2005 7070 R$ 1.90R$ 1.9030/03/200630/03/2006 170170 R$ 1.80R$ 1.8011/07/200611/07/2006 5050 R$ 1.75R$ 1.7511/07/200611/07/2006 550550 R$ 1.75R$ 1.75

------ 840840 ------

U$ 1 = R$ 1.70 (just as a reference)

= 800.000 t in Jan 2008

Page 26: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

ANP auctionsANP auctions

Promoted AuctionsPromoted Auctions DateDate SoldSold (10(1066 L)L) AverageAverage PricePriceFirstFirst auctionauctionSecondSecond auctionauctionThirdThird auctionauctionFourth auctionFourth auctionFifth auctionFifth auctionSixth auctionSixth auctionSeventh auctionSeventh auctionEighth auctionEighth auction 10/04/200810/04/2008 264264 R$ 2.69R$ 2.69NinethNineth auctionauctionTotalTotal

23/11/200523/11/2005 7070 R$ 1.90R$ 1.9030/03/200630/03/2006 170170 R$ 1.80R$ 1.8011/07/200611/07/2006 5050 R$ 1.75R$ 1.75

14/11/200714/11/2007 304304 R$ 1.87R$ 1.8714/11/200714/11/2007 7676 R$ 1.87R$ 1.87

11/07/200611/07/2006 550550 R$ 1.75R$ 1.7514/02/200714/02/2007 4545 R$ 1.86R$ 1.86

11/04/200811/04/2008 6666 R$ 2.69R$ 2.69------ 1,5851,585 ------

U$ 1 = R$ 1.70 (just as a reference)

= 1.200.000 t in Jul 2008

Page 27: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

Ensure good quality in small scale production unitsIncrease raw material supplyProvide both agronomical and technological information on alternative raw materials for biodiesel productionDevelop suitable strategies for distribution and blendingProvide suitable incentives for the entire production chainAfford suitable financing for potential biodiesel producersPromote suitable public policies to help the economics Improve biodiesel properties (cold flow and oxidation stability)Development alternative uses for valuable co-products

Program challengesProgram challenges

Page 28: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008CLAQ, San Juan, 2008

Page 29: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of
Page 30: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

Annual Production CapacityAnnual Production Capacity

0

500

1000

1500

2000

2500

mill

ion

TPY

Producing Built Planned Being built

= 5,590 million tons= 5,590 million tonsNov 2007Nov 2007

Page 31: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

Annual Production CapacityAnnual Production Capacity

0

500

1000

1500

2000

2500

mill

ion

TPY

Producing Built Planned Being built

= 5,293 million tons= 5,293 million tonsJul 2008Jul 2008

Page 32: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

Annual Production CapacityAnnual Production Capacity

Jul 2008Jul 2008 = 5,3% decrease= 5,3% decreaseNov 2007Nov 2007

0

500

1000

1500

2000

2500

mill

ion

TPY

Producing Built Planned Being built

Page 33: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008CLAQ, San Juan, 2008

Biodiesel in BrasilBiodiesel in BrasilSize (10³ TPY) Number Total capacity Average

X < 1010 < X < 5050 < X < 100

100 < X < 150X > 150all sizes

21 107.05 (4%) 5.1

10 1080 (40.5%) 1082 349.5 (13.5%) 184.7

16 518.1 (19.4%) 32.388 615.1 (23%) 76.89

51 2669.75 40.35

Size (10³ TPY) Number Total capacity AverageX < 10 31

3719184

109

162.85 (3.1%) 5.25

100 < X < 150 1927 (36.4%) 107.5X > 150 738.9 (14%)

10 < X < 50 1081.5 (20.4%) 29.2250 < X < 100 1383.1 (26.1%) 72.8

all sizes184.7

5293.35 48.62

Toda

yTo

mor

row

Page 34: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008CLAQ, San Juan, 2008

Biodiesel in BrasilBiodiesel in Brasil

TOMORROWTOMORROWTODAYTODAY

51 109 40.3 48.6

10 50 100 150 >150

0

10

20

30

40

Num

ber o

f pla

nts

Plant size

10 50 100 150 >150

0

10

20

30

40

50

% P

rodu

ctio

n

Plant size

Page 35: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008CLAQ, San Juan, 2008

Biodiesel in BrasilBiodiesel in BrasilCompany Location State Estimated annual

capacity (10³ tpy) ADMADM RondonRondonóópolis polis MTMT 169,5169,5

AgrencoAgrenco BioenergiaBioenergia Alto AraguaiaAlto Araguaia MTMT 180180Agropalma Belém PA 7,5Agrosoja Sorriso MT 24AMBRA Varginha MG 7,2

Araguassú Óleos Vegetais Porto Alegre do Norte MT 30Barralcool Barra do Bugres-MT MT 49,5

BertinBertin LinsLins SPSP 9090Bigfrango Rolândia PR 48Biobras Dom Aquino MT 24

BioCamp Campo Verde MT 46,2Biocapital Charqueada SP 51

Biodiesel Sul Içara SC 0,8Biopar Rolândia PR 36

More on next slide…

Page 36: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008CLAQ, San Juan, 2008

Biodiesel in BrasilBiodiesel in BrasilCompany Location State Estimated annual

capacity (10³ tpy) BioverdeBioverde TaubatTaubatéé SPSP 8585

Brasil Ecodiesel Floriano PI 40,5Brasil Brasil EcodieselEcodiesel IraquaraIraquara BABA 108108

Brasil Brasil EcodieselEcodiesel CrateCrateúúss CECE 108108Brasil Brasil EcodieselEcodiesel São LuisSão Luis MAMA 108108Brasil Brasil EcodieselEcodiesel RosRosáário do Sulrio do Sul RSRS 108108Brasil Brasil EcodieselEcodiesel Porto NacionalPorto Nacional TOTO 108108

BSBIOSBSBIOS Passo FundoPasso Fundo RSRS 100100Caramuru AlimentosCaramuru Alimentos São SimãoSão Simão GOGO 9090

Coapar Campus de Julio MT 3ComancheComanche Simões FilhoSimões Filho BABA 100100COOAMI Sorisso MT 9

Dhaymers Taboão da Serra SP 7,8Fertibom Catanduva SP 12

More on next slide…

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CLAQ, San Juan, 2008CLAQ, San Juan, 2008

Biodiesel in BrasilBiodiesel in BrasilCompany Location State Estimated annual

capacity (10³ tpy) FiagrilFiagril Lucas do Rio VerdeLucas do Rio Verde MTMT 135135GranolGranol AnAnáápolispolis GOGO 100100GranolGranol Cachoeira do SulCachoeira do Sul RSRS 105105

OleoplanOleoplan VeranVeranóópolispolis RSRS 98,198,1Ouro Verde Rolim de Moura RO 5,1Pesqueira Pesqueira PE 0,75

Sales Rondonópolis MT 1SP BIO Sumaré SP 39

Tranportadora Comandolli Rondonópolis MT 3Usibio Sinop MT 6

Vale do verde Sorriso MT 3

ANPapproved

ACTUAL PRODUCTION CAPACITY = 2,246.95 MTPYACTUAL PRODUCTION CAPACITY = 2,246.95 MTPY

Page 38: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008

BiodieselBiodiesel facilityfacility

EthanolEthanol, sugar , sugar andand coco--gerationgeration

Page 39: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008

ALCOHOL ALCOHOL MILLMILL

CRUSHER (OIL CRUSHER (OIL EXTRACTION)EXTRACTION)

BIODIESEL BIODIESEL UNITUNIT

CATALYST

HEAT

OIL CAKE

VEGETABLE OIL

HEATANHYDROUS

ETHANOL

GLYCERINBIODIESEL

HYDRATED ETHANOL

CANE

OILSEEDS

COCO--GENERATIONGENERATION

CANE BAGASSE

BIOELECTRICITY

ETHANOL

SUGAR

IntegrationIntegration

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CLAQ, San Juan, 2008CLAQ, San Juan, 2008

Page 41: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of
Page 42: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

CLAQ, San Juan, 2008CLAQ, San Juan, 2008

>80 million ha still available

Babaçu, soybean, castor, palm, cotton, coconut, animal fat

and fish wastes

Soybean, castor, sunflower, cotton, animal fat and fish

wastes

Soybean, canola, sunflower, cotton, animal fat and fish

wastes

Babaçu, soybean, palm, dendê and

animal fat

Soybean, castor, cotton, sunflower,

palm, Jatropha andanimal fat

Raw materialsRaw materials

Page 43: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

Productivity (kg/ha)

ndnd--100100Animal Animal fatfat

7027021,8001,8003939PeanutsPeanuts

OilOil productionproduction(kg/ha.(kg/ha.yearyear))

ProductivityProductivity(kg/ha.(kg/ha.yearyear))

OilOil//fatfat contentcontent(%) (%) RawRaw materialmaterial

3903901,0001,0003939GergelimGergelim

6726721,6001,6004242SunflowerSunflower

6846841,8001,8003838CanolaCanola

7507501,5001,5005050CastorCastor

3963962,2002,2001818SoybeansSoybeans2,0002,00010,00010,0002020PalmPalm

2702701,8001,8001515CottonCotton90090015,00015,00066BabaBabaççuu

Source: CONAB, 2007Source: CONAB, 2007

Raw materialsRaw materials

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CLAQ, San Juan, 2008CLAQ, San Juan, 2008

Real Real AnnualAnnual CostCost of Capitalof Capital Sales Sales andand AdministrationAdministrationAnnualizedAnnualized CostCost of of WorkingWorking CapitalCapital Fat/Fat/OilOilAlcoholAlcohol ((MethanolMethanol)) CatalystCatalystPlantPlant Labor + Labor + BenefitsBenefits UtilitiesUtilities, , MaintananceMaintanance, , InsuranceInsurance

6.36.38.88.8

1.01.0 69.969.95.15.11.61.63.43.44.04.0

Source: NBB

Raw materialsRaw materials

Page 45: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

SOYBEAN OIL BIODIESELSOYBEAN OIL BIODIESELOutput/Input Energy Ratio = 3*Output/Input Energy Ratio = 3*

* NREL (USA), http://www.nrel.gov/docs/legosti/fy98/24089.pdf

SoybeansSoybeans AREA (ha)AREA (ha)

YIELD (t/ha)YIELD (t/ha)

HARVESTING (t)HARVESTING (t)

Page 46: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

SunflowerSunflower

SUNFLOWER BIODIESELSUNFLOWER BIODIESELOutput/Input Energy Ratio = 2Output/Input Energy Ratio = 2--33

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Jatropha curcasJatropha curcas

JATROPHA OIL BIODIESELJATROPHA OIL BIODIESELOutput/Input Energy Ratio = 5Output/Input Energy Ratio = 5--6*6*

* * OuedraogoOuedraogo, 1991, 1991

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Castor beansCastor beans

Ricinus communis

CASTOR OIL METHYL ESTERSCASTOR OIL METHYL ESTERSOutput/Input Energy Ratio = 5Output/Input Energy Ratio = 5--66

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Palm treesPalm trees

* * LorLor, E.E.S. , E.E.S. etet al, al, WorldWorld BioenergyBioenergy, , http://www.svebio.se/attachments/33/295.pdfhttp://www.svebio.se/attachments/33/295.pdf

PALM OIL BIODIESELPALM OIL BIODIESELOutput/Input Energy Ratio = 8*Output/Input Energy Ratio = 8*

DwarfDwarf palmpalm treetreedevelopeddeveloped in Costa Ricain Costa Rica

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Other sourcesOther sources

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GlyceridesGlycerides 12%12%

PhospholipidsPhospholipids 8%8%

Free fatty acidsFree fatty acids 10%10%

WaterWater 45%45%

OthersOthers 25%25%

SoapstocksSoapstocks

Source: Michael Haas, USDASource: Michael Haas, USDA

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Animal fatAnimal fat

40 million animals are slaughtered in Brazil per year40 million animals are slaughtered in Brazil per yearTotal production is estimated at 700,000 TPYTotal production is estimated at 700,000 TPYAnother 350,000 TPY are produced in Argentina, Uruguay and ParagAnother 350,000 TPY are produced in Argentina, Uruguay and Paraguayuay

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IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

Measured in 106 ha

Amazon rain forest 350Pasture 210Protected areas 55Annual crops 47Perennial 14Urban areas, lakes, roads and swamps 20Reforestation for pulp and paper 5Other uses 60Arable land available for agriculture 90

Total 851

TerritTerritóório Nacional: 8,51 milhões de rio Nacional: 8,51 milhões de KmKm²²

The food vs. feed debacleThe food vs. feed debacle

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IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

The food vs. feed debacleThe food vs. feed debacleAreaArea (10(1066 ha)ha) PercentagePercentage (%)(%)

BRASIL (TOTAL)BRASIL (TOTAL) 851851 100%100%FREE ARABLE LANDFREE ARABLE LAND 383383 45%45%

PASTUREPASTURE 210210 25%25%(55% (55% ofof thethe arable arable landland))

AVAILABLE FOR AVAILABLE FOR AGRICULTUREAGRICULTURE 9191 11%11%

(24% (24% ofof thethe arable arable landland))

SUGARCANE FOR SUGARCANE FOR ETHANOLETHANOL 3.13.1 0,4%0,4%

(0.8% (0.8% ofof thethe arable arable landland))LIPID SOURCES FOR LIPID SOURCES FOR

B2 AND B5B2 AND B5 1.7 1.7 toto 4.04.00.2 a 0.47%0.2 a 0.47%

(0.4% a 1% (0.4% a 1% ofof thethe arable arable landland))

Page 55: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008

The food vs. feed debacleThe food vs. feed debacle

FUEL FOR ENGINES

FUEL FOR PLANTS

FUEL FOR ANIMALS (FOOD AND FEED)

Biofuels + Food + Biofertilizers

BIOMASSBIOMASS

Page 56: July 29, 2008 – San Juan, Puerto Rico Biodiesel Production ......Argentina Resolution 129 Definition of the national biodiesel standard 01/11/2001 Argentina Law 26093 Promotion of

MapasMapas dada NASANASAhttp://www.guiageohttp://www.guiageo--americas.com/mapas/globoamericas.com/mapas/globo--imagens.htmimagens.htm

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IBC, Vienna, 2007IBC, Vienna, 2007IBC, Vienna, 2007

CLAQ, San Juan, 2008ThankThank youyou!!