Energy Policy 39 (2011) 421–428

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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
Faculdade de Engenharia Mecânica, UNICAMP, Cidade Universitária ‘‘Zeferino Vaz’’, P.O. Box 6122, 13083-970 Campinas, SP, Brazil
b
Interdisciplinary Center of Energy Planning (NIPE), UNICAMP, Cidade Universitária ‘‘Zeferino Vaz’’, P.O. Box 1170, 13084-971 Campinas, SP, Brazil

a r t i c l e in f o abstract

Article history: This work compares the technical, economic and environmental (GHG emissions mitigation) perfor-
Received 24 May 2010 mance of power generation and ethanol production from sugarcane residual biomass, considering
Accepted 14 October 2010 conversion plants adjacent to a sugarcane mill in Brazil. Systems performances were simulated for a
Available online 4 November 2010
projected enzymatic saccharification co-fermentation plant (Ethanol option) and for a commercial steam-
Keywords: Rankine power plant (Electricity option). Surplus bagasse from the mill would be used as fuel/raw
Cellulosic ethanol material for conversion, while cane trash collected from the field would be used as supplementary fuel at
Bioelectricity the mill. For the Electricity option, the sugarcane biorefinery (mill +adjacent plant) would produce 91 L of
CHP 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.

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 ligno-
cellulosic 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: jeaseabra@gmail.com (J.E. Seabra).
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 cost-
effective alternative, but also competitive with the already com-
mercial 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 pre-
ferred in terms of resource depletion and toxicity concerns. The
authors concluded that in the near term, the environmentally

0301-4215/$ - see front matter & 2010 Elsevier Ltd. All rights reserved.
doi:10.1016/j.enpol.2010.10.019
422 J.E.A. Seabra, I.C. Macedo / Energy Policy 39 (2011) 421–428

preferred option is electricity cogeneration, except in cases where a Table 1

lead additive phase-out comes as a result of fuel ethanol use where Characteristics of the reference mill adopted in this study.a
large toxicity reduction make this option more attractive.
Milling capacity 1000 t cane/h
These case studies show that conclusions are dependent on Mill’s effective operating time 4000 h/year
technology assumptions and region of application, indicating that Adjacent plant’s operating time 8406 h/year
dedicated comparative evaluations for different bagasse uses in Total milling 4 Mt cane/year
Brazil are needed to proper investigate the local case. The objective Bagasse availability 260 kg/t cane (50% moisture content)
Trash availability 66 kg/t cane (15% moisture content)
of this work was to compare the technical–economic performance Ethanol yield 91 L/t cane (from cane juice)
and the environmental benefits of power generation and ethanol
Energy demand
production from sugarcane residual biomass in Brazil, considering
Steam  360 kg/t cane (2.5 bar)
conversion plants adjacent to a mill (Fig. 1). For power generation Electricity 28 kWh/t cane (all electric drivers)
(Electricity option) we considered a commercial Rankine-cycle
Cogeneration system 65 bar/480 1C; backpressure turbine
system, while the ethanol production (Ethanol option) was based
on a projected enzymatic saccharification and co–fermentation a
From Seabra et al. (2010).
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 Table 2
benefits were evaluated as the ability to mitigate GHG emissions. Biomass availability and use (dry thousand tonnes/year).a
Other environmental factors can also play important roles
Biomass Bagasse Trash
(e.g., toxicity and eutrophication) in this comparison, but they
were not included here. Available at the mill 520 224
Losses 26 11
Used in the mill’s boiler 118 213
Other uses 14 –
2. Selected systems Biomass surplus 362 –

a
From Seabra et al. (2010). Values estimated for a mill with capacity of 4 Mt
2.1. Sugarcane mill
cane/year.

We adopted as reference for this study a 4 Mt cane/year mill

used as supplementary fuel at the mill (Seabra et al., 2010). To avoid
producing exclusively anhydrous ethanol (an autonomous distil-
eventual storage problems, we assumed that all trash would be
lery) with reduced steam consumption (  360 kg/t cane) and
burnt in the mill’s boiler during the cane season (on average 6–7
equipped with a high pressure/temperature cogeneration system
months) and that only the surplus bagasse would be used as fuel/
(Seabra et al., 2010). This system is able to supply all energy needs
raw material in the adjacent plant (see Fig. 1).
of the mill (heat and power) and export some electricity to the grid.
Based on a simplified model of the mill’s power plant (devel-
Table 1 presents a summary of the main characteristics for this
oped using Aspen PlusTM), Seabra et al. (2010) estimated the final
reference mill.
bagasse surplus as 362 dry thousand tonnes/year (see details in
In addition to bagasse, we considered that 40% (i.e., 56 kgdry/t
Table 2), considering the assumptions presented above. The mill’s
cane) of the trash available in the field would be recovered to be
backpressure turbine would produce 238 GWh (electricity) during
the cane harvesting season, of which 126 GWh could be exported to
the grid.

Cane juice Juice Ethanol

processing
2.2. Power plant: electricity option
Steam Electricity
The use of Rankine cycle to produce electricity from biomass is a
commercial, mature technology. In the Brazilian sugarcane mills,
Cane trash the conventional cogeneration cycles currently used have been
Mill’s power Electricity essentially designed to meet mill’s energy needs, consuming all the
plant bagasse available. Since the end of the 1990s, however, with the
Bagasse
de–regulation of the Brazilian power sector, mills started an
accelerated modernization process, substituting medium-and-
Adjacent plant high pressure boilers ( 440 bar) and condensing–extraction steam
turbines (CEST) for the old machinery aiming at the production of
Bagasse
high electricity surpluses (Leal and Macedo, 2004). Today, all new
surplus
Electricity option: units and many operating (older) mills are able to work as
Electricity
Power plant standalone thermoelectric plants, even during the off-season if
biomass is available.
OR In this study, we took as reference for the adjacent plant a
steam-Rankine system (Fig. 2), similar to new projects for sugar-
Ethanol option: Ethanol
cane mills (Dedini Indústrias de Base, 2009). The system is
Biochem. conversion equipped with a 65 bar/480 1C boiler. The system was modeled
plant Electricity using HysysTM, and its performance was simulated considering the
biomass availability presented above (362 kt/year) and an operat-
ing time of 8406 h/year. The total power generation was estimated
Fig. 1. Sugarcane biorefinery: mill+ adjacent plant. 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 co-
fermentation (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 Units Electricity option Ethanol option

Mill
Ethanol 103 m3/year (L/t cane) 364 (91) 364 (91)
Electricity GWh/year (kWh/t cane) 126 (32) 126 (32)

Adjacent plant
Ethanol 103 m3/year (L/t cane) – 134 (33)
Electricity GWh/year (kWh/t cane) 392 (98) 75 (19)

Biorefineryb
Ethanol 103 m3/year (L/t cane) 364 (91) 498 (124)
Electricity GWh/year (kWh/t cane) 519 (130) 201 (50)

a
Based on a cane input of 4 Mt/year plus 224,000 t cane trash (dry).
Fig. 2. Schematic representation of the steam-Rankine power plant. b
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$2007).a
Parameter Electricity option Ethanol option
FCIb,c 50.7 151.4
Working capitald 2.5 7.6
Annual costse 15.1 33.5
Operating costsf 6.7 15.0
Biomassg 3.4 3.4
Depreciationh 5.1 15.1
Annual salese,i 27.5 58.7
ROIj 23.2% 15.9%
a
Values in United States 2007 dollars. We considered an exchange rate of
2 R$/US$.
b
Fixed capital investment (FCI) was calculated based on vendor quotations and
specialists’ information on equipments’ cost for given sizes (determined using the
simulation models). For the Electricity option, this value includes the investment
needed for grid connection. Such investment varies considerably between different
projects, depending on the distance from the mill to the substation, the line voltage,
among other system characteristics. Here, we assumed this investment as approxi-
mately 5 M US$, 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$/tdry. Cane trash is used as supple-
mentary fuel at the mill, but its cost was entirely attributed to the adjacent plant.
h
10% of FCI.
i mercially available. The parameters assumed for such scenario,
Annual sales of electricity surplus and ethanol. Ethanol price at 400 US$/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 metho-
dology 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 com-
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 emis-
sions 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 intensi-
fication 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 para-
meters (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) 421–428 425

Electricty option Ethanol option

40% 40%

30% 30%

ROI

ROI
20% 20%

10% 10%

0% 0%
40% 60% 80% 100% 120% 140% 160% 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.

Electricity option Ethanol option

25% 25%

20% 20%

15% 15%

ROI
ROI

10% 10%

5% 5%

0% 0%
10 20 30 40 50 10 20 30 40 50
Cane trash cost (US$/tdry) Cane trash cost (US$/tdry)
Bagasse at 0 US$/t dry Bagasse at 10 US$/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
600
Units Value
Ethanol price (US$/m3)

500 Parameter
Cane productivity t/ha 95
400 Harvested area % total area % 90
Total diesel consumptionb L/ha 350
Unburned cane harvesting % 100
300
Mechanical harvesting % 100
Total trash yield kgdry/t cane 140
200 Cane trash collection % 40
Above ground nitrogenc g/t cane 992
100 Agr. Inputs
N g/t cane 548
0 P2O5 g/t cane 32
50 60 70 80 90 K2O g/t cane 70
CaCO3 g/t cane 4,947
Electricity price (US$/MWh)
a
Values projected by CTC specialists. Parameters not presented here are
Fig. 6. Equal ROI prices for ethanol and electricity.
assumed to be equal to the current averages (Seabra and Macedo, 2010).
b
Includes diesel consumption in all activities (sugarcane farming, harvesting,
performed the analysis apart from GREET, based on aggregated transportation, etc.).
c
information from Brazilian Chemical Industry Association Estimated above ground nitrogen availability related to crop and industrial
residues returned to the soil. We assumed that 60% of the available trash would
(Abiquim, 2008).
remain on the ground after cane harvesting.
The avoided emissions were estimated considering the sub-
stitution of sugarcane products for the equivalent products in as presented in Table 6. Small differences are observed in the
Brazil. Anhydrous ethanol substitutes for gasoline, as E22 blends to sugarcane processing; in the Electricity option, greater direct
operate in gasohol dedicated cars, while bagasse-derived electri- emissions are verified, derived from bagasse combustion, while
city displaces natural gas thermoelectric generation, which is the Ethanol option present greater emissions associated to chemicals
main fuel of the marginal electricity generation in Brazil (Seabra production. For the Ethanol option, emissions from ethanol trans-
and Macedo, 2010). port and distribution and fuel combustion (tailpipe emissions) are
Since sugarcane production parameters are the same for both naturally greater than for the Electricity option, due to the higher
technology routes, the total GHG emissions resulted to be similar, ethanol yield per tonne of cane.
426 J.E.A. Seabra, I.C. Macedo / Energy Policy 39 (2011) 421–428

Table 6 120
GHG emissions balance for the sugarcane biorefinerya (kg CO2eq/t cane).

Gasoline emissions (g CO2eq/MJ)

Electricity option Ethanol option 100

Total emissions 40.0 42.3

Sugarcane farming 10.8 10.8 80
Trash burning 0.0 0.0
Field emissions 11.7 11.7
60
Agr. inputs production 4.3 4.3
Sugarcane transportation 2.5 2.5
Sugarcane processing 5.7 6.1 40
Ethanol T&D 3.4 4.7
Tailpipe emissions 1.5 2.1

Avoided emissions  281.8  310.2

20
Marginal electricity displacement  76.6  29.7
Gasoline displacementb  205.1  280.5 0
Net avoided emissions  241.8  267.9 400 500 600 700 800 900 1000
a
Marginal electricity emissions (kg CO2eq/MWh)
Mill + adjacent plant.
b
Fuel equivalence:  1.3 L ethanol/L gasoline (Seabra and Macedo, 2010).
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).
mitigation promoted by ethanol with respect to gasoline is
Electricity option Ethanol option
frequently used. In many cases, the conclusions about which
Total emissions 148 173 option promotes the greater mitigation are difficult: co-products
Bagasse ‘‘production’’a 120 120 credits can result in apparently greater benefits than higher ethanol
Bagasse processing 28 33 yields, since emissions are evaluated per cubic meter of fuel. For the
Ethanol T&D 14
Tailpipe emissions 6
cases evaluated here, for instance, ethanol life-cycle emissions
would be  19 and 5 g CO2eq/MJ, respectively for the Electricity
Avoided emissions  641  955
and Ethanol options. The electricity option apparently presents a
Marginal electricity displacement  641  122
Gasoline displacement  833 better environmental performance essentially because more cred-
its are assigned to ethanol, while less fuel is produced per tonne of
Net avoided emissions  493  781
cane. Therefore, comparisons leveled by the feedstock, or prefer-
a
Part of the sugarcane production emissions was allocated to the surplus ably by unit of land area, are more appropriate to evaluate the
bagasse, based on the energy content of mill’s products (ethanol, electricity and overall benefit.
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.
5. Energy policies and the decision: ethanol or electricity from
bagasse and trash?
Despite the additional emission sources, the Ethanol option is
able to mitigate more GHG emissions. This environmental advan- Energy policies which may lead to decisions on producing more
tage is stressed in Table 7, which presents the emissions balance electricity or more ethanol from cane residues will probably be
related only to the adjacent plants. In this table, only the inputs and essentially local, Brazilian policies rather than global initiatives like
outputs of the adjacent plant are considered (i.e., the ethanol and the Clean Development Mechanism (CDM) or carbon taxes.
electricity produced at the mill are not taken into account). Since a The context for the Brazilian sugarcane industry shows a
biorefinery concept is involved, with the production of multiple strong growth: 387 Mt cane/year, in 2005/2006; 564 Mt in 2008/
products, a procedure was adopted to allocate the upstream 2009, and projected 1100 Mt cane/year, in 2020 (UNICA, 2010).
emission burdens among the products from the mill and the Sugar production will take 30% of the cane in 2020 (against 40%
adjacent plant. Emissions derived from cane production were today); ethanol (as fuel for internal market and exports,
allocated based on the energy content of mill’s products (ethanol, and less than 10% for industrial uses including plastics production)
electricity and bagasse surplus), leading to the ‘‘bagasse produc- will use the largest portion (EPE, 2010). All uses will provide
tion’’ emissions. Alternatively, emissions credits from the co- surplus bagasse and trash for electricity (or ethanol). Since 2002 a
products could be assigned to the main product using a system large number of mills is being built, and the decision to produce
expansion method. more electricity is made at this point, involving the adoption of
Though avoided emissions by the displacement of NG thermo- higher pressure boilers, condensation capacity, turbines and
electricity are significant (even for the Ethanol option), the benefits generators.
of ethanol substitution for gasoline determines the preference for The experience to date shows that:
the liquid fuel production. Nevertheless, power generation is
preferred if more carbon intensive fuels (coal, for instance) are 1. There have been no significant government policies to promote
considered for the marginal electricity generation, as illustrated in (or support) ethanol since 1990. The only policy remaining from
Fig. 7. Similarly to the economics, these results are sensitive to the the Pro-Alcool program is the mandatory 20–25% blend with
products yields (net avoided emissions and yields have a practically gasoline (which accounts for a relatively small portion of the
linear relationship), and differences in the assumed process ethanol used). Ethanol became competitive with gasoline at
efficiencies may change the final results. relatively low oil prices (BNDES, CGEE, 2008). Growth has been
For different biorefinery concepts (and feedstocks) producing assured by technological innovation (like the flex-fuel car,
ethanol (or other biofuel), the comparison between the emissions 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 genera-
tion 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 commer-
cial 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 environmen-
tal (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, lead-
ing 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.
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