A recent empirical analysis has demonstrated that, for example, the use of rapeseed biodiesel represents a saving of approximately 56 % of emissions when compared to conventional diesel, measured in CO2 equivalents (Rasetti et al. 2012). According to Timilsina and Shrestha (2010), biodiesel from palm oil is generally considered to

yield the most substantial GHG savings, typically in the range of 50-80 %. Biodiesel both derived from sunflower and from soybean delivers significant GHG savings: Emission savings from biodiesel based on sunflower appear to converge around 60-80 %, while those from soybean biodiesel tend to be around 50-70 %.

However, recent studies have shown that the production of biofuels can lead to a net rise in CO2 emissions if dLUC and in particular ILUC effects are taken into account (see Table 12); this is the reason why the EU in the COM 595 wanted to limit the contribution that conventional biofuels make toward attainment of the tar­gets in the RED.

Furthermore, starting with commodity cultivation up to its final use, it must be verified that the greenhouse gas reduction accompanying the use of biofuel is cur­rently at least 35 % and from 2017 at least 50 % compared to fossil fuel.

EU Commission instructed various scientific institutes in order to verify the connection between what land extents would have to be additionally cultivated and what quantity of greenhouse gases would be emitted from these areas if the EU target value of 10 % of renewable energies in the transport sector was achieved.

A cause-effect relationship could not be verified. The reason for this is very complex connections to the international agricultural markets and the low amount of commodities for biofuel production. This is why the EU Commission had ini­tially suggested having this ‘ILUC phenomenon’ further investigated by scientists.

Table 12 shows the average GHGs emission savings (in %) in the production of biodiesel from different feedstocks (rapeseed, sunflower, palm, and soybean) com­pared to those related to the diesel life cycle in three different scenarios: the first without land-use changes and the second and the third including direct and indi­rect land-use changes, respectively. Negative values indicate increase in emissions.

It also provides the ratio between the energy generated during the use of bio­diesel in road transport and the energy used during production, processing, and transportation of the biodiesel (energy efficiency).

These data derive from an exploratory meta-analysis of 32 scientific and techni­cal reports emerging from international research (Bentivoglio et al. 2012).

Looking at the data in the Table 12, it results that, in the scenario without land-use change, all the biofuels considered provide GHG emission savings. In the second scenario, the most remarkable result is the huge loss in emission sav­ings bound to the production of biodiesel from palm oil due to the substitution of peatlands in Malaysia. Regarding the energy efficiency, biodiesel from palm oil recorded the best performance (9.1).

2 Conclusions

The sustainability of biofuels derived from agricultural biomass is widely debated nowadays. On the one hand, the production of biofuels ensures energy security for the historically non-oil producing countries; on the other hand, it turns on the food versus fuel debate and the land-use change issue, generally responsible for a net loss in GHG emissions savings related to biofuels production and consumption. However, these issues need to be addressed keeping in mind different variables: the geographical area of production of energy biomass, the type of biofuel (ethanol or biodiesel) produced, and the feedstock used (corn, sugarcane, beet, vegetable oils).

This work compares different aspects related to the production of ethanol from sugarcane in Brazil (first generation) with those bound to the production of European biodiesel and of rapeseed oil that it is a principal European feedstock.

The goal was to highlight the differences between Brazil and European Union in the biofuel production and the reasons why Brazil has a competitive advantage in the ethanol production and the European Union has a competitive advantage in the biodiesel production.

The comparison between the two biofuels summarizes the results derived from the extensive scientific literature, taking into account production and energy effi­ciency, but also economic and environmental sustainability.

The sugarcane ethanol energy balance is 9.3, much higher if compared to 1.4 for ethanol from corn in the USA and to 2.5 for rapeseed biodiesel in EU. The ethanol productivity is approximately 7,000 l/ha, whereas biodiesel from rape — seed yield (the most frequently used biomass in the EU) is about 1,320 l of bio­diesel per hectare. At the same time, ethanol production costs from sugarcane are much lower than those required to produce biodiesel from rapeseed oil. According to international literature, the costs derived from empirical analysis are about 0.56-0.58 $/l for the Brazilian sugarcane ethanol (Xavier and Rosa 2012) versus 1.00 $/l for the European rapeseed biodiesel (Finco and Padella 2012).

Concerning environmental sustainability, the performances in terms of GHG emissions saving, too, are in favor of sugarcane ethanol. However, in this case, the production of biodiesel, and in particular from palm oil and soybean, does not seem to deviate very much from those values. The fundamental question is that palm oil is not indigenous production and EU imports it from Asia. In addition, if it include direct and indirect land-use changes in the average GHGs emission savings (%) from different feedstocks (rapeseed, sunflower, palm and soybean), it is pos­sible to identify GHG emissions increase especially in palm oil production. In the opposite case, the sunflower which is widely produced in southern Europe (Italy, Spain) shows the best performance with regard to environmental LUC and ILUC.

It should be noted that the assessment of the effects of land-use change on the direct and indirect are very controversial and the international literature presents many methodological approaches that are not always comparable.

Regarding the Brazilian scenario, there are many studies on land use, direct and indirect (LUC, ILUC). For example, the research studies of Brazil show that the amount of new land required for sugarcane production would be relatively small (Arima et al. 2011; Macedo et al. 2012). In the same way, the LUC module based on a transition matrix developed by Ferreira Filho and Horridge (2011) and calibrated with data from the Brazilian Agricultural Censuses of 1995 and 2006 shows how land use changed across different uses (crops, pastures, forestry, and natural forests) between those years. The results obtained by general equilibrium models approach show that the ILUC effects of ethanol expansion are of the order of 0.14 ha of new land coming from previously unused land for each new hectare of sugarcane. This value is higher than values found in the Brazilian literature (Ferreira Filho and Horridge 2011).

In this context, the contribution of government policies (Brazil and EU) is essential in order to guide the biofuel sector toward a sustainable development. A first step in this direction was the introduction of certification schemes and criteria, accepted worldwide as well as the attempt to avoid direct and indirect land-use changes, preventing the exploitation of sensitive areas to the detriment of biodi­versity and carbon stocks reduction. However, according to Amezaga et al. (2010), the sustainability criteria proposed by the EU, which aim to combat the environ­mental problem, have been subject to widespread criticism and extensive discus­sion. Problems have been voiced not only about the measures that are in place, but also about significant factors which are not dealt with in the Directive.

Nevertheless, it should be noted that the market-oriented policies implemented by governments should be consistent and continuous in time so as to avoid market distortions and even more failures in the sector as is being done in the European context after the abolition of the instrument of tax exemption and the imposition of product requirements is not always appropriate.

Despite the competitive advantage, in terms of economic and environmental sustainability, taken by sugarcane ethanol compared to other biofuels as enlight­ened by the previous considerations, we believe in the importance of defending even a small European biodiesel production to sustain energy security, considered by all the BRIC countries the main engine of economic development.

In this transaction, the degree of uncertainty is high for both parties, which is related not only to the risk of losses under the conditions of this activity (drought, pests, prices, etc.) but also to the risk of breach of contract.

Regarding risks resulting from environmental conditions, we highlight the cases of fatal yellowing (FT) disease in the north of the country.

Palm oil, according to Trindade et al. (2005) and Barcelos et al. (2001), is highly susceptible to FY. This anomaly, according to a group of authors, is a seri­ous disease of extreme importance to the economy of the countries that cultivate these oilseeds, particularly in Brazil where it has caused vast losses as it multiplies rapidly (TRINDADE et al. 2005).

FY is a threat to the development of palm oil culture in Para, aggravated by the fact its cause remains unknown. Several studies have been conducted to determine the cause or the causal agents of FY in palm oil trees, yet thus far, no correlation has been found with insects, physiological, soil, and pathogen problems (BOARI 2008).

In the case of palm oil, a crop that requires high investments, as the first harvest only takes place about 4 years after planting, the migration to this crop did not take place, even though the percentage required in the north is considered low in comparison to other regions. However, this fact was verified in the northeast with the castor bean, where the SCS percentages were high (Cesar 2012).

The low interest in this culture enabled building credibility in the arrangements fostered by Agropalma, and the company already has a list of farmers interested in participating in PNPB. The integration model investigated for family farming— albeit with some deadlocks in its implementation and maintenance—was reported by all respondents in this study as a case study to be replicated.

The oil palm projects are still considered pilot projects, which has contributed to better tracking the results by MDA. However, there are risks regarding the fam­ily farmers abandoning the projects, given these workers’ more extractivist profile and due to the planting requirements for these palm trees. The renouncement rate of the projects is of around 10-15 %.

Given these circumstances, according to the theory presented, the type of busi­ness relationship between family farming and the biodiesel plant should imple­ment a governance structure characterized by relational contracts. That is why by mean of the SCS seal, companies promote the preliminary signing of the con­tract as well as the partial verticalization of family farming. However, it should be emphasized that the attributes analyzed are very high for oil palm, creating a tendency in which companies prefer to internalize these costs by a complete verti — calization of the agricultural activity.

The high uncertainty—as in the cases of family farming—is associated with changes in prices and product availability in the market (supply by the farmers), which in turn contributes to market price fluctuations, as for instance foreign commodities and products used by other industries (competition between indus­tries). Lastly, this transaction can be coordinated by the market itself, but in the case of the Brazilian biodiesel production, this tends to take place via contracts between the processing plant and business farmers and the plants and extractors.

Biofuel comes from biomass: biological material that comes from living organisms. In the USA, ethanol is the main biodiesel and in 2008 and 2009, 9.0 and 10.8 billion liters of ethanol were distilled, respectively, representing 6.5 % of the automotive fuel in the country (Wetzstein and Wetzstein 2011). In the USA, biodiesel is funded by the federal government according to a partial tax exemption and several state sub­sidies. These initiatives have generated a rapid growth in terms of ethanol produc­tion (from 0.2 billion liters in 1980 to over 10 billion gallons).

In Brazil, the dominance of biodiesel is due to the production of ethanol and biodiesel, where biodiesel has grown in the last few years, especially due to a gradual increase of diesel used for road transportation, according to governmental norm-related resolutions, such as the one made on January 1st 2010, where the percentage of biodiesel to be added to diesel oil increased to 5 % of the volume consumed in the country, which is approximately 341 million barrels/year and growing, as it is shown on Fig. 1.

We can see on Fig. 1 (right) that the apparent consumption of diesel has grown significantly; in January 1979, there was a daily average consumption of 297 thousand barrels, and in December 2012 we can see an apparent consumption of 1,059 thousand barrels/day—a 256 % increase for this period. Accompanying the consumption of diesel, the production of biodiesel was significantly increased between 2005 and 2012, in this period there was an expressive increase of the national biodiesel production (from 736 to 2,618,624 m3 in 2012, equivalent to 17 million oil barrels). Do note that this increase was due to the introduction of biodiesel in the Brazilian energetic matrix in 2005, where we tried to gradually increase the percentage of biodiesel in the diesel oil used for road transportation (from 2 % in January 13, 2005, to 5 % in January 2010, and an estimated growth for the next years to come).

On Fig. 1 (left), we can see that the apparent consumption of ethanol has also experienced a significant growth. In January 1979, the average daily consumption was at 34 thousand barrels of diesel, and in December 2012, there is a 334 thou­sand barrels/day—a 982 % increase for this period. Please note that this increase was due to the creation of a Brazilian program of incentive to ethanol production and consumption as a source of energy—the Proalcool. The National Alcohol Program

(Proalcool) was created by the decree No. 76.593/75, thus stimulating the production of alcohol for the internal and external markets and the automotive fuels policy.

Considering this continuous increase of the biodiesel consumption, Brazil has 65 industrial plants authorized for construction and 10 are authorized for expan­sion, making up an increase of the daily productive capacity of 4.114 and 748 m3, respectively, while currently the monthly production is of around 60 % of its cur­rent installed capacity (ANP 2012). Figure 2 shows the distribution of biofuels companies in the national territory.

On Fig. 2, we can see the cropped area for sugarcane, where we can see that the plantation concentration is especially high in the central-southern region (where Sao Paulo represents 63 % of the region’s production and 54 % of Brazil’s production), and in the north-northeastern region (especially in the coastal region, which represents around 13 % of the national production of sugarcane). We can see on left

of Picture 2 that there is a higher concentration of industrial plants in the south and central west, which are traditionally known as great soybean producers; this cereal is currently responsible for 80 % of the raw material for producing biodiesel. The main source of raw material for biodiesel is soybean, followed by beef fat, and cotton. Despite being the main raw material used in the process of producing biodiesel, it is not the most efficient, considering the crop area, as shown on Fig. 3.

We can see on Fig. 3 that each hectare of planted soy corresponds to 700 L of bio­diesel, whereas the palm oil corresponds to around 5,100 liters. From this perspective, there is a need of 3.073 million hectares of land destined for soy, in order to respond to the current demand of 17 million barrels/year, representing approximately 12.30 % of the planted area in Brazil: 27.2 million hectares, as mentioned (MA 2012).

Considering the importance of this topic in the agricultural context, we have yet to consider the importance of understanding the concentration level for the bio­diesel industry, as several strengths operate in this system: social demands due to the increase of food cost, economic demands due to the importance that the main raw material (soybeans) has in Brazilian exports, as well as political demands due to the need of decreasing the oil dependency in the country’s energetic matrix.

In this context, we can see that the biofuel demand shall continue to rapidly increase, influenced by the crescent increase of oil cost, and the crescent govern­mental support to cleaner energies. This increase will be induced especially for environmental and energy safety reasons. In the New Policies Scenario that con­siders the public policies commitments and plans announces by the countries, including guaranties of reduction of greenhouse effect gases emission, and plans to ban subsidies for fossil fuels, the world consumption of biofuel will increase approximately from the current 1.1 million barrels/day (63.8 billion liters/year) to 4.4 mb/d (255.3 billion liters/year) in 2035 (MME 2010).

Also according to MME (2010), biofuels will account for around 8 % of the world consumption for transportation in 2035, a significant increase compared to 3 % in 2009. It is estimated that the US and Brazil will continue to be the biggest world producers and consumers of biofuels. The USA will account for 38 % of the world consumption of biofuels in 2035 (a decrease compared to the current 45 %), whereas Brazil will account for 20 % of the world consumption of biofuel in 2035. Given the importance of this topic, and in order to respond to the problem of this research, the following section presents the main methodological aspects used in this work.

Second-generation biofuels are derived from feedstocks not traditionally used for human consumption, such as wood, organic waste, food crop waste and dedicated biofuel crops. As a result, their use in biofuel production has minimal to no impact on other edible crop prices, thereby also alleviating concerns that biofuel produc­tion will exacerbate famine in the developing world (IEA 2008a). Furthermore, the technologies employed in producing second-generation biofuel use the majority or even all of the biomass (Table 1). This helps with reducing the considerable waste associated with the production of first-generation biofuels (Deurwaarder 2005).

At present, it is thought that second-generation biofuels could cost as much as twice their petroleum-based equivalents (Reilly and Paltsev 2007; Carriquiry et al. 2010) and, certainly, more than first-generation equivalents. Low carbon prices, or rather the inability of the market to internalize all the negative external costs asso­ciated with petroleum-based fuels, have also had a significant impact. In effect, the current global price of fossil fuels vis-a-vis more sustainable ones such as second — generation biofuels can be regarded as something of a market failure. That said, it

Table 1 Classification of biofuels (United Nations 2008)

First-generation biofuels Second-generation biofuels

is hoped that, by 2050, 90 % of the world’s biofuel will be provided by second- generation techniques (IEA 2008b).

Brazil stands as the second largest producer of ethanol obtained from sugarcane in the international market, having similar energy potential and much lower cost vis-a-vis ethanol from corn of countries such as the USA, and regions such as the European Union (EU), from beet and starch. Table 1 presents the global ethanol production between 2007 and 2012.

In Table 1, it is observed that the USA, Brazil, and Europe account for over 90 % of global ethanol production. The first two countries had similar production scale at the beginning of the period mentioned, occurring an expressive shift in favor of the USA during the period. In turn, EU has doubled its production with­out, however, reducing the difference to the first two significantly.

Brazil is pointed out as a tropical country with continental dimensions, in which the supply of biomass has great potential for use in power generation by Castro and Dantas (2008). In 2007, biomass was the second source of energy used in Brazil, with 31.1 % of the energy matrix, preceded by oil and its derivatives. Considering the national supply, biomass, along with other sources of internal origin, accounted for 3.7 % of the offer, according to the National Energy Balance (NEB) (ANEEL 2008).

According to Tolmasquim (2012), a great part of the Brazilian territory is within the most thriving region of the planet for the production of biomass, not only due to the high degree of sunlight on its territory, but also for its environ­mental conditions. In bioenergy, sugarcane stands out owing to technological advances, both in the agricultural and industrial phases, making ethanol and bio­electricity competitive products internally and externally.

The technological advance was not only due to the energy offer. The flex-fuel vehi­cle, whose engines work on any proportion of ethanol or gasoline, has already been consolidated in the market. Such was the acceptance of the Brazilian consumer that only 9 months after its release in 2003, the fleet of flex-fuel vehicles accounted for 57 % of the national fleet of light vehicles, i. e., about 18 million units (UNICA 2013b).

According to the Center for Sugarcane Technology (CTC) (2005), the biomass of sugarcane may become more important in energetic, economic, and environ­mental terms, with the increasing search for improvements in the production sys­tems of the sugarcane industry.

According to Dias et al. (2009), this highlight is due to the relevance of etha­nol production, its by-products, bagasse (cogeneration of electricity), and straw, as well as most of the biomass residues obtained in the agricultural and industrial activities, which become raw material capable of producing energy.

Among the sources of biomass for electricity generation in the country, sug­arcane is an alternative with great potential through the use of bagasse and straw. The participation of the cane is not only important for the diversification of the electric matrix, but also because the harvest coincides with the dry season in the Southeast and Midwest regions, where the greatest capacity of hydropower in Brazil is concentrated (ANEEL 2008).

Table 2 presents the main secondary sources, being expressively featured the electricity, produced mainly from hydropower and biomass, which have the sus­tainable characteristics due to the low GHG generation.

1.1.1 The Sugarcane Biomass

Both in Brazil and in the international market, biomass has been considered one of the main alternatives for diversification of energy sources and reduction of the use of fossil fuels (ANEEL 2008).

According to UNICA (2013a), there are 64.7 millions of hectares fit to sugar­cane plantation, i. e., 7.5 % of Brazilian cultivable area. However, sugarcane plan­tation occupied only 1 % of cultivable area in 2012. The sugarcane productivity in 2011/2012 harvest was 58.25 ton/ha for an area of 9.6 millions of hectares. The sugarcane production for milling was of 559.2 millions of tons, of which 297 mil­lions of tons of sugarcane were earmarked for the production of ethanol and the rest were earmarked for the production of sugar. It was produced a total of 22.7 millions of m3 of ethanol (8.6 million m3 of anhydrous ethanol and 14.1 million m3 of hydrated ethanol), i. e., about 6.8 m3/ha (UNICA 2013b) (Fig. 1).

In Brazil, there are 327 mills and distilleries allowed to operate for sugar and ethanol production, in which average capacity is about 810 m3/day. These mills are distributed in most Brazilian states, but their concentration is in Middle-South region. The total quantity of workers in these mills and distilleries was 160,984 in 2011 (Portal da Cana 2013; RAIS 2012). According to Shikida (2013), ‘1 ton of sugarcane produces, simultaneously, 120-135 kg of sugar and 20-23 l of ethanol, or if only produce ethanol, the amount is 80-86 l of ethanol’ (oral information).

The Brazilian areas suitable for the cultivation of sugarcane are concentrated in the Central-South region of Brazil (Fig. 2).

The sugarcane production is not adequate to the biome of the Brazilian Amazon or Pantanal, not only because they are protected areas by environmental legisla­tion, but also because they do not have edaphoclimatic conditions for sugarcane cultivation. It is noted that most of the sugarcane units, i. e., mills and distilleries are located in the Central-South and the northeastern coast of the country.

Veiga Filho (2008:3) reinforces this statement saying:

Rodrigues, [coordinator of the Agribusiness Center of Getulio Vargas Foundation] and Marcos Jank, [former] president of UNICA [Sugarcane Industry Union], say that 75 % of the sugar cane expansion occurs in pasture areas, which disallows another aspect of the offensive mounted against Brazilian ethanol. They say that the cane does not represent a real threat to the environmentally critical areas, such as the Amazon.

Chagas (2012) points out that in Brazil, ethanol is used in three sectors of the economy: transport, the chemical industry, and beverage manufacturing. Regardless of its allocation, Brazilian ethanol is more competitive than that pro­duced in other countries due to the large scale, which provides low production cost and low GHG emission, among other factors.

Table 3 depicts the volume of primary sources of biomass used in Brazil in 2011, highlighting the by-products of cane, which represent for more than 78 % of the primary sources.

In Brazil, there is no importation and exportation of sugarcane by-products. These by-products are consumed in the same mills and distilleries which they are produced because their transportation is infeasible. The transport of sugarcane also is infeasible for distance about 50-80 km from the mills (Rangel et al. 2008).

The results of the production cost analysis for fuels are based on scenarios of crude oil prices of Euro 50, Euro 100, Euro 150 and Euro 200 per barrel and under consideration of the technical status for the years 2015 and 2020. Table 5 summa­rises these results.

1. Estimated biofuel production costs in 2015

Our modelling results (Fig. 4) show that in 2015 only biodiesel is able to reach competitive production costs and only at high crude oil prices. Biodiesel made from waste oil can compete with fossil fuels in the Euro 150/barrel and Euro 200/ barrel scenarios. Biodiesel from palm oil reaches competitiveness in the crude oil price scenario of Euro 200/barrel. Production costs for second-generation bioetha­nol are significantly higher than those of fossil fuels in all crude oil price scenar­ios. Furthermore, unlike for other biofuels, the simulation of different crude oil scenarios in Fig. 4 indicates that production costs for bioethanol from lignocel — lulosic waste is largely independent of the crude oil price levels. In addition, our simulation reveals that HVO and BTL are unlikely to be a reasonable alternative to other fuels as their production costs are significantly higher than the others.

2. Estimated biofuel production costs in 2020

At the crude oil price scenario of Euro 50/barrel, the production cost of all bio­fuel alternatives is too high to be competitive (Fig. 5), even when scale and learn­ing effects are considered for 2020. Again, biodiesel made from waste oil seems to be the most promising option. In the Euro 100/barrel scenario, waste oil bio­diesel production costs (Euro-Cent 55 per litre) are lower than those of fossil fuel (Euro-Cent 68 per litre), followed by the more expensive biodiesel made from palm oil (Euro-Cent 81 per litre) and second-generation bioethanol (Euro-Cent 86 per litre). At a market price of Euro 150/barrel, ethanol made from lignocellulosic waste becomes attractive. While production costs for fossil fuel stand at Euro-Cent 99 per litre, second-generation bioethanol can be produced for Euro-Cent 91 per

litre. In this crude oil price scenario, bioethanol is even cheaper to produce than biodiesel made from palm oil (Euro-Cent 98 per litre). However, biodiesel from waste oil (Euro-Cent 64 per litre) remains the most attractive option, cost-wise. The 150 Euro/barrel results are documented in Fig. 6.

First-generation biodiesel and first-generation bioethanol show an increase of overall production costs between 2015 and 2020 despite positive learning and scale effects. This is due to the influence of high raw material prices. One can note that all first-generation biofuels, except palm oil biodiesel, experience increasing production costs. In regard to palm oil biodiesel, advancements in production pro­cesses are capable of overcompensating the rise of feedstock prices.

There is a similar situation with HVO and especially BTL. The combination of relatively high raw material costs and high conversion costs make both types of biofuel uncompetitive. Although significant learning effects between 2015 and 2020 will lead to considerably lower conversion costs, HVO’s and BTL’s poten­tial as a substitute for fossil fuels is virtually non-existent. The related cost-sav­ing potentials are simply not sufficient to compensate the high raw material costs. Consequently, one cannot expect either of these two types of biofuel to be pro­duced at competitive costs, even though both have a higher energy density com­pared with other biofuels and, in particular, bioethanol.

When learning and scale effects are considered, second-generation biofuels seem to be the most promising alternatives to fossil fuels throughout all crude oil price scenarios until 2020. In detail, the most promising options in regard to production costs are biodiesel from waste oil and bioethanol made from ligno — cellulosic raw materials when produced at large scales.

Our results are in line with research from de Wit et al. (2010), who explain this order between those two types of biofuels by lower feedstock, capital and opera­tional costs. Compared to bioethanol of the first generation, the production of bio­diesel is associated with lower feedstock costs. In addition, capital and operational expenditures for the transesterification of oil to biodiesel are lower compared to the conversion process of first-generation bioethanol (hydrolysis and fermentation of sugar/starch crops). This initial advantage of biodiesel over bioethanol, how­ever, may impede the exploitation of positive effects associated with learning and a larger scope and, in consequence, may prevent the use of related cost-saving potentials for bioethanol.

Silvio Vaz Jr. and Jennifer R. Dodson

Abstract Analytical techniques are vital for the development of new added-value materials and products from biomass, such as liquid biofuels, by evaluating the quality and chemical composition of the raw materials and all materials and byprod­ucts in the production process. This also enables the evaluation and implementation of environmental laws and better understanding of the economics of new biomass processes. Different analytical techniques are applied to different biomass feed­stocks, such as sugarcane, soybean, corn, forests, pulp and paper, waste and agri­cultural residues, dependent on the final end biofuel product. This chapter highlights how the use of analytical chemistry can be used as a tool to ensure quality and sus­tainability of the biomass and liquid biofuels, with, some aspects of green analysis also considered.

1 Introduction

The technological development of modern society is increasingly resulting in the need for methods to control products and processes, to ensure that they fulfill quality standards, and to prevent negative impacts on the environment. The increasing demand from society for more sustainable and lower impact products has become important across all aspects of production, including in agricultural sector. The agri­cultural sector has proposed in recent years to reduce the generation of greenhouse

S. Vaz Jr. (*)

Brazilian Agricultural Research Corporation (EMBRAPA), Brasilia, DF, Brazil e-mail: silvio. vaz@embrapa. br

J. R. Dodson

Federal University of Rio de Janeiro (UFRJ), Rio de Janeiro, RJ, Brazil

A. Domingos Padula et al. (eds.), Liquid Biofuels: Emergence, Development and Prospects, Lecture Notes in Energy 27, DOI: 10.1007/978-1-4471-6482-1_9, © Springer-Verlag London 2014

gases through increased yields combined with the application of sustainable practices, e. g., lower tillage per area, a decrease in the use of agrochemicals, and a decrease in the water usage. One example of how agriculture could contribute to reductions in greenhouse gases worldwide is through the use of biomass for bio­energy applications, particularly the production of liquid fuels such as bioethanol and biodiesel from agricultural crops and waste products to replace petroleum feedstocks (Grafton et al. 2012; Norse 2012; Rathmann et al. 2010; Balat and Balat 2009; Goldemberg et al. 2008).

There are four main types of biomass which can be used to produce liquid bio­fuels: oleaginous, sugary, starchy, and cellulosic (International Energy Agency 2013). For instance, soybean (Glycine max) and oil palm (Elaeis guineensis) gen­erate oils for biodiesel production; sugar from sugarcane (Saccharum spp.) and sorghum (Sorghum bicolor (L.) Moench) and starch from corn (Zea mays) can be used to produce first-generation ethanol (1G ethanol); while bagasse, straw, and cellulosic wood are applicable for second-generation ethanol (2G ethanol). Each one has unique structural and chemical characteristics, which therefore require different analytical technologies and approaches to better understand the process­ing of the materials, the products formed and economic aspects. Analytical meth­ods are vital for enabling quality control of raw materials and products, providing accurate knowledge for the regularization of products and markets (Scarlat and Dallemond 2011; Orts et al. 2008). Analytical techniques can therefore support the development of new products and processes from biomass, helping to promote a bioeconomy (Gallezot 2012). Chemical analyses, either based on classical or instrumental techniques, play an important role in the exploitation of biomass as supporting technologies for all stages of biomass processing and for different bio­mass sources, including sugarcane, soybean, corn, forests, pulp and paper, waste and agricultural residues, among others (Feng and Buchman 2012; Sluiter et al. 2010; Orts et al. 2008).

Fundamentally, a liquid biofuel is defined as:

• Liquid state under normal conditions of temperature and pressure (25 °C and 1 atm, respectively);

• Lower vapor pressure and high energy content;

• Presence of oxygen in almost all biofuels;

• Obtained from a chemical synthesis process: biodiesel by transesterifica­tion (Meher et al. 2006); biokerosene by transesterification and esterification, followed by distillation (Llamas et al. 2012); and gasoline and diesel by Fischer-Tropsh (Balat and Balat 2009);

• Obtained from a fermentation process: ethanol by Saccharomyces cerevisiae strain (Balat and Balat 2009), and n-butanol by Clostridium acetobutylicum strain (Lu et at. 2012).

The practical application of analytical techniques for chemical analysis of feed­stocks and biofuels is discussed in this chapter in order to convey their potential use for technical or scientific applications. Alongside, some aspects of green anal­ysis, quality control, and technological trends are considered.

Fig. 1 Some chemical structures of fatty acids from oleaginous plants such as soybean. Author Silvio Vaz Jr

in the Liquid Biofuels Industry

D. F. Kolling, V. F. Dalla Corte and C. A. O. Oliveira

Abstract Biofuels have emerged as a source of energy for many countries. Although the interest in developing this industrial sector might be sensitive to mar­ket issues, government policies can influence its supply and demand. This chapter provides a discussion on issues such as the supply, the demand, exports, imports, prices, and future perspectives of the global market of ethanol and biodiesel. We focus on Brazil and the USA, which are the leaders in these markets. We found evidence of a significant increase in the demand for biofuels in several countries, which contributes to their developing energy and environmental security and adds value to their agriculture sectors. Incentive programs for biofuels depend on gov­ernment policies. However, the production of biofuels differs in each country that we studied. The development of the biofuel chain is recent, and the supply depends on the whole structure of it and not exclusively on one institutional agent.

1 Introduction

Biofuel production started in the late nineteenth century when ethanol was pro­duced from corn and Rudolf Diesel’s first engine worked using peanut oil. Before 1940, biofuels were seen as viable fuels for transportation, but low fossil fuel [10] [11]

prices stopped investments and further development in biofuels. Interest in the production of these fuels re-emerged in the 1970s when Brazil and the USA began to produce ethanol on a commercial scale.

Sources of renewable energy are of great importance to national markets. The biomass and biofuel trade has been constantly growing, as it is driven by the increases in oil prices and by incentive policies for using biomass and biofuel to generate energy (Junginger et al. 2010). The dependence on oil and its derivatives has put the world’s economy, energy security, and environment at risk. In recent years, rapid growth in biofuel production has been observed around the world, and this growth has been supported by government policies.

The biofuel industry is a dynamic multi-sector that is involved in the system of fuel production and trade. The interest in developing this industrial sector is gen­erated from investor groups and is associated with economic, social, and politi­cal factors. In addition, biofuel production might be subject to market forces, as it depends on locations, the access to resources and the infrastructure for its genera­tion and distribution.

In addition to the economic aspects, the reduction of CO2 emissions has become an important driver of biofuel development. Interest in biofuels is rising because it represents an alternative fuel that shows superior environmental benefits to fossil fuels. Biofuels are also economically competitive and can be produce on a sufficient scale to impact energy demands considerably (Hill et al. 2006). This chapter provides a discussion on the relevant technical, economic, and administra­tive aspects of the global biofuel industry, and it describes initiatives in different countries.

Traditional biofuel technologies are presented in this chapter, including well — established processes for producing biofuels on a commercial scale. According to the International Energy Agency (IEA 2011), these biofuels are commonly referred to as first generation. The dynamic expansion of biofuel production pro­moted an increasing interest in economic studies that analyze the production, demand, supply, and trade of biofuels. These subjects will be discussed in this chapter.

At the current stage of PNPB, the institutional environment is crucial for the inclusion of oil palm family farmers in this production chain. Thus, the following is emphasized: implementing contracts with oil palm family farmers (a marginal portion of the business). There is tendency for the biodiesel plants located in the north—as well as those planning to initiate this business—to also verticalize their agricultural activities.

In the case presented in this chapter, the system imposes the debt discharge with the retention of the loan payment by the bank itself. Since the company is a kind of guarantor, by applying its own resources in the arrangement, it is consid­ered a sort of partner to the venture.

Given the attributes of the social transactions presented, the bonus system (premium payment for palm oil) is deemed as important to comply with the con­tractual agreement. This incentive encourages bilateral dependence, commitment, and credibility in the continuity of the relationship. The increased frequency of these transactions produces information between the parties, contributing to the agents’ reputation.

During the interviews, it became clear that the participation of the technical staff in the transaction strengthened the family farmers’ trust in the company, espe­cially because of their extensive knowledge of the region.

Thus, the technicians are key figures in the transaction as they are the interface between the purchasing department and the assurance of the supply quality.

The reputation and also the informal ties reinforce the different forms of coor­dination, which are important complementary elements in the transaction. Thus, the agents can build a reputation that increases the assurance that they will act within the expected ethical standards, which favors the investment of the parties involved in the transaction.

The social projects developed with palm were indicated by all respondents as a success case that should be replicated. The minimum quota of SCS to the north of the country is attractive, and, according to field research information, companies have already begun to perform their own mapping of family farmers that could produce palm oil in the Northern region. The goal is to plan an agricultural pro­duction that is in line with the needs foreseen of the processing plants.

The survival of the human species is linked to the exploitation of natural resources, as there is no other known way to provide the essential heat, energy, and food. There has been a great deal of debate regarding how this exploitation can occur, since to exist, organisms need to intervene in natural systems. A superficial analysis might suggest that an irreconcilable dichotomy has been created. Such reasoning may lead to extreme attitudes where, on one side there is the irresponsi­ble use of natural resources, and on the other, the discourse suggesting that nature could be so much better off without the human presence on earth.

The state of well-being achieved by modern societies has increased the rate of unsustainable exploitation of the planet’s resources. Our technological choices are based on our understanding that nature’s capacity to provide for what we con­sider to be our needs is unlimited. It follows then that an alternative path must be designed so that those technological choices lead to a process of sustainable exploitation of natural resources. After all we are the only species on the planet that is endowed with a capacity for awareness that is sufficient not only to under­stand and evaluate our own destructive power, but also with the intelligence required to minimize it.

Therefore, it seems appropriate to move toward new productive systems, whether agricultural or industrial, where growth and development can be achieved without the opposition between capital and nature. For this to happen, we must overcome the economic, social, and political challenges that the technological solutions present.

Thus, understanding the relationships between the natural and social environ­ment seems to be the way forward in the search for a solution to the problems that challenge the planet, since it is from within this society that the answers to those challenges will emerge. However, we must avoid believing in a panacea, since there is no single “cure” that can be used to solve modern problems, as there is an intricate set of social, economic, and ecological relationships. As Hippocrates said: “Disease is the result of the airs, waters and places.”

There is insufficient space to address all these issues in a single book, so we have chosen just one path, that of energy. This choice is justified by its importance as a factor in development and its condition as one of the key elements in the inter­action between society and nature. The production and use of energy determine numerous impacts on the planet and on societies. While it may be an indicator of well-being, its effects may be adverse (Dincer 2002).

Among the adverse effects of the current methods of obtaining and using energy one can include the environmental impacts, price fluctuations, geopoliti­cal risks, and the risks of its nonavailability. Because of these effects, there has been growing interest in the search for alternatives to current patterns of produc­tion and consumption of energy throughout the world (Holdren 2006; Hanegraaf 1998). Within the energy sector worldwide, experts have addressed a number of issues, among them one can mention the research into conversion technologies as applied to different inputs in order to produce liquid and gaseous fuels, and into geographical organization for the production of food and energy.

Among the various studies of note, that by David Tilmann (2009) highlights the trilemma of the plant-derived fuel production systems. What he refers to as the trilemma is the need to simultaneously attend the requirements for food, fiber, and renewable fuels. Based on this trilemma and by analyzing initiatives from around the world, one possible conclusion is that with the current level of use of the tech­nologies and services available it will be impossible to reverse the rate of exploita­tion of the resources required to meet our energy needs according to the criteria of social, economic, and environmental sustainability, considering the rate of world population growth and its impact on the volume of resources that will be required to meet those needs.

Inspired by these issues and based on the structuring of energy matrices in dif­ferent countries, this book deals with different aspects of the production and use of liquid biofuels, derived from the production and conversion of biomass. Among the primary sources of energy, biomass has come to occupy a growing place in the energy mix worldwide. The concept of biomass can be understood as refer­ring to all living matter on earth that is capable of storing solar energy (Taylor 2008; Goyal et al. 2008). Many researchers consider biomass to be a source capa­ble of contributing to the energy needs of both developed and developing societies (Berndes et al. 2003).

Around the world, different arrangements for the production of bioenergy are being developed, with multiple integrated technologies that either benefit from the concentrated supply of inputs produced in large scale or take advantage of the small-scale production of inputs at the local level. These trends present us with the challenge to find the most efficient use for the natural inputs available.

From a demand and supply perspective, it should be noted that bioenergy is coming to be seen as a priority on the international agenda, with the use of liq­uid biofuels constituting a key strategy in the attempt to meet both the demand for environmental sustainability and the energy needs of countries. The growth in the production and use of biofuels around the world has led to increased interest and discussion on the subject, lending greater importance to related studies and research, as is the case with this book.

Without claiming to be exhaustive, this book provides a critical and plural dis­cussion of the major issues being raised in the context of research and policies and the alternatives that are being outlined regarding the insertion of bioenergy in the energy matrices of several countries. In this sense the book provides a multidisci­plinary and integrated view of the debate on the emergence and diffusion of the liquid biofuels as an energy source, bringing together different elements, such as public policy, industry organization, and the sustainability of different systems for the production of liquid biofuels and technology. The discussion on these different aspects will be illustrated by biofuel researchers and practitioners from a range countries that produce and consume biofuels.

In this book the reader will find that biofuel production, analyzed in relation to its institutional, economic, technological, and environmental aspects, is presented in two parts. The first, consisting of eight chapters, deals with the economic and environmental aspects. The second part of the book, consisting of four chapters, presents and discusses the technological issues. Importantly, almost all the chap­ters include discussions on the institutional aspects related to biofuel, especially the issue of regulation imposed by governments in order to strategically control the production and distribution of biofuels.

In compiling this book, our intention was to address the main issues and key challenges related to the production and consumption of bioenergy. When the call was issued to researchers from around the world, our main objective was to seek out different perspectives and analyses on the subject, while identifying points of convergence and divergence among several different research centers around the globe.

We hope that this book serves as a “must-read” reference for all those involved in biofuel-related research. We feel sure that it contains valuable material for the library of any biofuel researcher, practitioner, and/or educator. In selecting the contents, we have attempted to provide material that will be of interest to both those with experience in the field of biofuel and those who are setting out to dis­cover its relevance.

“Economic Issues in the Liquid Biofuels Industry” discusses the market distor­tions that occur when the production costs of the first generation of biofuels com­pared with those of fossil fuels. In doing so, the relationship between the energy market and the agricultural market is emphasized. The relationship between bio­fuels and the agriculture and energy markets is dealt with from three perspectives: energy security risk; reduction of greenhouse gas emissions; and rural develop­ment. “A Comparison Between Ethanol and Biodiesel Production: The Brazilian and European Experiences” spotlights the Brazilian ethanol and European bio­diesel scene in terms of the policies adopted and their production, supply and demand, as well as the environmental impacts of these biofuels.

“Global Market Issues in the Liquid Biofuels Industry” discusses issues such as the supply, demand, exports, imports, prices, and future perspectives of the global market for ethanol and biodiesel by focusing on Brazil and the United States. Both countries are of great importance in the global biofuel market both in terms of their respective production capacities and as consumer markets. “The Biofuel Industry Concentration in Brazil Between 2005 and 2012” deals with the growth and concentration of production capacity in the Brazilian biofuels industry.

“Calculation of Raw Material Prices and Conversion Costs for Biofuels” takes a closer look at the discussion regarding the raw materials in the first generation bio­fuels, by presenting a forecast of raw material prices, simulating the likely effects on production costs of the economies of scale obtained from scaling-up produc­tion and from technological learning. An analysis is provided of various scenarios in which different biofuels and fossil fuels are compared. Regarding raw materi­als for the production of biodiesel, two chapters present and discuss alternatives to the traditional oilseeds used in biodiesel production, though with an organizational and economic focus. “Governance of Biodiesel Production Chain: An Analysis of Palm Oil Social Arrangements” deals with the governance structure of the biodiesel production chain in Brazil from a social perspective by focusing on the relation­ship between the farmers and the palm oil industry. “An Economic Assessment of Second-Generation Liquid Fuels Production Possibilities” provides an economic assessment of the possibility of producing the second generation biofuels, more spe­cifically bioethanol production from lignocellulosic materials in the United States.

“Environmental Issues in the Liquid Biofuels Industry” completes the first part of the book and deals with the environmental issues involved in the liquid biofuels industry, presenting the different generations of biofuels and discussing them in relation to their Tailpipe Emissions, life cycle, Ecological Footprint, and Climate Threats and Technological Opportunities.

The second part of the book addresses the technological aspects of biofuel pro­duction. The chapters within it highlight the different types of technologies used in biofuel production and the use of new materials such as algae, oleaginous organ­isms, and waste polymers. Accordingly, “Application of Analytical Chemistry in the Production of Liquid Biofuels” discusses the use of chemical analysis in the production of biofuels with respect to the evaluation of the quality and chemical composition of the raw materials and all materials and by-products in the produc­tion process. Also related to the use of chemistry in the production of biofuels, “Technical Barriers to Advanced Liquid Biofuels Production via Biochemical Route” deals with the technical barriers to advanced liquid biofuel production via the biochemical route, focusing on second and third generation feedstocks.

The chapters that follow focus on the use of new raw materials for the produc­tion of biofuels as alternatives to mitigate the problems and limitations posed by the use of the raw materials of agricultural origin used in the first generation of biofuels. “New Frontiers in the Production of Biodiesel: Biodiesel Derived from Macro and Microorganisms” highlights the state of the art and the main character­istics of the oil and biodiesel provided by macroorganisms (insects) and microor­ganisms (bacteria, filamentous fungi, and yeasts). “Algae: Advanced Biofuels and Other Opportunities” looks into the use of algae as an alternative source of biofu­els, presenting a review of microalgae cultivation (species, usage, processes, and culture), while highlighting the advantages and challenges of algae-based biofuel. The last chapter is not directly concerned with biofuels, as it focuses on another possible alternative, liquid fuels from waste polymers, thus opening another possi­ble route for the production of alternative fuels to petroleum, and potentially mini­mizing the environmental impact by using industrial waste from various industries.

Acknowledgments We are very grateful for the support and contribution of so many authoritative biofuel researchers and practitioners in writing chapters for this book. We extend a special thanks to Springer’s publication team for their encouragement, help, and patience in compiling this book.