A sustainable energy system can only evolve as a common effort of many actors. The state has a coordinating role which is accomplished through the definition of goals of common interest, and strategies and policies to coordinate efforts in the preferred direction. The strategies and decisions of energy companies to invest are strongly influenced by the policy framework provided. Corporate decisions operate within various frameworks and define strategies which have consequences for the development of energy systems at the national and international level. These impli­cations go beyond the considerations made at national policy design which are still strong, even in the EU where efforts are being made towards policy harmonization. With increased integration of energy markets, there is also need for increased regional and global coordination, and the absence of strong commitments have been detrimental to the systems shift that are being envisaged.

We are all energy users and we play a role as a group. Users can influence tech­nology choices as both voters and users of energy services. But we should recognize that few users are interested in energy per se. The users want reliable energy services at reasonable prices and many also want sustainable development. But it is up to public and private decision makers, engineers and experts to engineer sustainable solutions and orchestrate change.

In the past few years, a number of initiatives have been launched by interna­tional organizations, national governments, nongovernmental organizations and the private sector. For example, in 2000, FAO and IEA Bioenergy signed a Memo­randum of Understanding opening for a closer collaboration around cross-sectoral activities focused on bioenergy options. This is part of efforts being made at FAO to promote cross-fertilization of work done in forestry, rural development and energy, where bioenergy takes a prominent role. Also in 2000, a new initiative was launched in the G8 meeting held in Okinawa, Japan, aimed at promoting renewables in developing countries. In 2002 in Johannesburg, energy and development were, for the first time, treated together in an effort to set common global goals for renewable energy.

This increasing interest and support certainly provides an important base for further work in the establishment of bioenergy systems. International organizations fulfil an important role in mobilizing interest, efforts and resources. Investment banks and UN organizations can contribute in assessing and disseminating infor­mation, allocating resources for demonstration projects and liaising with national organizations to design policies and projects. International organizations can help bridge information gaps between investors and technology owners, local business and policy makers to open new channels for investments and technology transfer, thus fostering also the development process.

Most of all, we have shown here that there is significant work in progress. Among the measures envisaged to deal with remaining constraints to market penetration of renewables for electricity production, including biomass, IEA suggests measures to reduce technical problems in the form of research and demonstration, policies to level the playing field for renewables by eliminating subsidies to fossil fuel alternatives and internalization of social and environmental costs of all energy forms, as well as green electricity schemes and temporary incentives to encourage investments in renewables.

We should add that research is still strongly focused on solutions in the context of industrialized countries, while more attention is needed to understand the realities and demands of developing countries and emerging economies. This should actually also be in line with commercial interests aimed at the creation of markets for new technologies. We certainly need innovation and increased efficiency of energy systems. But we also need reliability and scale and, here, the developing countries shall be good partners, particularly in bioenergy. It is time to break the mental barrier that has transformed developing countries into a world where there is large potential demand for energy but no money. Let us seriously start considering developing countries as part of the solution — a world full of renewable resources that can help create welfare. Let us realize the bioenergy potential together.

[1] Bioenergy — Realizing the Potential

© 2005 Dr Semida Silveira Published by Elsevier Ltd. All rights reserved.

Considering end-use only and excluding all losses.

[3] It is not dear if the NO* tax has favored biomass-based compared to fossil-based energy. The general energy tax, however, has had its major impact on the private heating market, since it does not apply on electricity production and the industry sector at large.

[4] This chapter includes results of the doctoral thesis of the author: “Fiinfzehn Jahre Biomasse — Nahwarmenetze in Osterreich” (Fifteen years of biomass district heating in Austria). Technische Universitat Wien, 1997. The thesis was written within the EU funded project Pathways from small scale experiments to sustainable regional development, EXPRESS PATH, CEC Contract No EV5V-CT92- 0086.

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[5] €=13.76 ATS.

[6] This issue was investigated in the course of the Express Path project by Kunze, G. in Cultural change and the diffusion of sustainable energy technologies. Unpublished.

[7] We refer to the 3500 km mountain range that stretches from Afghanistan in the west through Pakistan, India, China, Nepal, Bhutan, and Bangladesh to Myanmar in the east. This region is home to more than 140 million people.

[8] These values refer to a period when the exchange rate of the Brazilian currency was temporarily high. At 2002 rates, the costs are significantly lower.

[9] The method used in this study is more thoroughly described in Bernotat (2002), Bernotat and Sandberg (2002), and especially in Sandberg and Bernotat (2003).

[10] Monica Rodrigues de Souza is grateful to CNPq and CAPES for the financial support received during her work at University of Campinas — Brazil and at STS, Universiteit Utrecht, The Netherlands.

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[11] The authors wish to express their gratitude to the Energy Forum, Sri Lanka for its financial assistance to carry out this study. The help extended by the Department of Survey, Department of Forests, Sri Lanka and the Energy Conservation Fund of Sri Lanka in providing necessary data is also gratefully acknowledged.

Bioenergy — Realizing the Potential © 2005 Dr Semida Silveira Published by Elsevier Ltd. All rights reserved.

[12] Definition of sources and types of solid biofuels through a detailed and transparent terminology of the biomass resources (i. e. the different types of forest products and residues).

‘ FAIR, Agriculture and Agro-Industry including Fisheries Programme of Research and Technological Development, was implemented under the Fourth Framework Programme of the EU (1994-1998). THERMIE, the demonstration component of the nonnuclear energy RTD Programme of the EU was implemented in the period 1995-1998.

[14] This is the period after full ripeness and the best period for harvesting corn. At this point, the water content of corn is about 14-16 per cent and the straw becomes fragile.

[15] Approximately 26.9 million Euro.

[16] The views expressed in this chapter are those of the author and do not necessarily represent the views of the World Bank.

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[17] The cerrado is the native landscape in the area of the project. The cerrado covers large extensions in Brazil and is sometimes referred to as the Brazilian type of savannah. This native forest has been traditionally used for the production of charcoal.

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[18] The laws concerned include also decree 1282, dated October 29, 1994, which states the rules for compliance with article 21 of the Brazilian forestry code (law number 4771, dated from September 15, 1965). The latter demands that the mills, freight companies and others, which are based on charcoal, fuel wood or other forestry raw materials, must keep their own plantations and explore them rationally. Supporting legislation there is normative instruction number 001, dated September 5, 1996, which provides rules on forestry reposition and law number 9605, dated February 12, 1998, which defines penalties to be applied for activities causing damage to the environment. These legal instruments are administered by 1BAMA (Brazilian Institute for the Environment and Renewable Natural Resources).

[19] Electrobras and the Brazilian Ministry of Mines and Energy, 1999. Ten-Year Expansion Plan: 1999-2008, produced by the GCPS Electric Systems Planning Coordination Group, Brazil.

[20] Of approximately 300 sugar mills in Brazil, less than half sell surplus electricity to the grid. The majority of mills produce energy solely for on-site use, which is the Business-as-Usual for the sugarcane industry.

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TJLP is the Brazilian long term interest rate.

[22] Cogerafao Setor Alcooleiro, CPFL, 1995.

[23] Programa Estruturado de Aumento da Oferta 2001-2003, Governo do Estado de Sao Paulo, Secretaria do Estado de Energia.


The pig iron and carbonization segments are important sources of employment in Brazil. By 1998, the pig iron segment employed 131000 people in Brazil, about two-thirds of these in Minas Gerais. The vast majority was employed in reforestation and production of charcoal from native or planted sources (May and Chomitz, 2001). About 25 per cent were engaged in forward linked activities in the steel and foundry industries that use pig iron as an input (ABRACAVE, 2001). Charcoal production is the most labor-intensive part of the charcoal-based iron industry. Of the 84000 employed in the independent pig-iron segment, 70000 or 83 per cent are engaged in field activities related to cutting, transporting and carbonising fuel wood (SINDIFER, 2000).

Traditionally, labor conditions in the production of charcoal have been appalling. The field activities related to cutting, transporting and carbonizing fuel wood have

been historically criticized for health and safety risks, poorly remunerated labor conditions and child labor. Growing social awareness and concern has led to a worldwide campaign against rural wage slavery and child labor in Brazil (May and Chomitz, 2001).

The Plantar Group (which also includes a division for provision of services to third parties) currently employs 5500 people, who may retain their jobs as the project goes ahead. Labor conditions in Plantar are above average and the firm does not employ children, as certified independently by the SCS Group as part of the Forest Stewardship Council’s certification process. The planned changes in the carboniza­tion process are also expected to lead to substantial improvements in the health of employees. Associated with the social requirements of the Forest Stewardship Council, there is scope for Plantar to provide a better model of socially responsible enterprises.

The pig iron sector is beneficial to the Brazilian economy, being a major employer, responsible for significant amount of exports (US$ 445 million FOB in 2000 according to IBS 2000), and the source of raw materials to other industries in the country.

The Plantar project provides a new model for financing the charcoal-based pig iron industry in Minas Gerais and Brazil, allowing for the survival of independent producers and the plantation forestry sectors in the region. This new business model could also help attract substantial additional foreign investment to the country, with positive effects to the Brazilian balance of payments.

Considering the focus on the small independent producers, there are also important benefits to be accrued from wealth distribution and development of small and medium sized enterprises. The multiplier effect of this investment is likely to bring additional benefits, particularly in rural areas where the project is located. It will result in additional job creation and preservation of jobs associated with forestry activities, having important effects in the regional rural economy.

Wood Waste Cogeneration in Kumasi, Ghana

Dominic Derzu, Henry Mensah-Brown and Abeeku Brew-Hammond


The demand for power has increased significantly in Ghana over the years, resulting in an annual power supply crisis since 1983. Thus the country has had increasing difficulties in meeting the demand of domestic and industrial consumers, and export commitments to neighboring countries. In fact, Ghana used to be a net exporter of electricity but this situation has changed and the country is now a net importer of power from la Cote d’Ivoire. Hence there is an urgent need to look for alternative sources to widen the power generation mix in the country, while also improving the reliability of supply.

The hydropower plants at Akosombo and Kpong, and the recently added thermal plants at Takoradi, together with the import complements from la Cote d’Ivoire, cannot meet the power demand for various user categories. The short supply of electricity throughout Ghana forces many small and medium enterprises (SMEs) to run expensive standby diesel generators to meet their energy requirements. The government has decided to remove all the latent hurdles preventing private sector involvement in the energy sector and the economy has been liberalized, resulting in an influx of new investors.

Biomass resources from the agricultural and forestry sectors are readily available for energy purposes along with wind and solar resources. The limiting factors for the utilization of these energy sources include location, availability and sustainability of the resources, fuel handling and preparation, and opportunities for fuel flexibility. In addition, the technology choice and its reliability, as well as the overall economics of energy projects are particularly important, especially now that the tariff regime is being reviewed towards better economic efficiency.

This chapter looks into the potential for wood waste utilization for power gene­ration in Kumasi, Ghana. The specific conditions for utilizing wood waste from wood-processing industries in cogeneration are presented for a project. The feasi­bility of the project is discussed under the framework of CDM, which also includes the boundary and baseline for the project, the carbon offsets as certified emissions

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Table 16.1. Estimates of volume of residues from wood-processing activities in Ghana

Type of wastes

% of the total log input

Volume in m3 SWE




Bark, slabs and edgings









Source: Kumasi Wood Waste Cogeneration Feasibility Report, 2001.

reductions (CERs) expected, and the outstanding issues that need to be solved to allow full implementation of the project. The project seeks to make use of abundant resources currently perceived as a nuisance to the environment, while also offering an opportunity for power generation.

Carbon Credits from Cogeneration with Bagasse

Marcelo Junqueira


The demand for electricity in Brazil is growing fast, requiring new and cost-efficient ways to meet the country’s energy needs. Brazil’s predominant reliance on hydropower (80 per cent of the country’s total electricity use in 2002) is expected to decrease as diversification is being pursued. The competitiveness of large hydropower falls in face of relatively high construction and transmission costs. In addition, about half of Brazil’s remaining hydro potential is located in the Amazon area, where many social and environmental constraints hinder further development.

In response to that, Brazilian authorities have developed a thermoelectric program. The Brazilian Ten-year Expansion Plan for 1999-20081 counts on increased involvement of private capital in the electricity sector for the construction of new thermal plants. The thermoelectric expansion plan is based on the use of natural gas, mineral coal and, in the case of isolated electricity systems, petroleum derivatives. In the South and Southeast regions (where Companhia Energetica Santa Elisa is located) only natural gas will be used.

Within the above scenario, the amount of greenhouse gas emissions are expected to increase in Brazil. Meanwhile, the Kyoto Protocol and, in particular, the Clean Development Mechanism (CDM) provides a useful financial tool to foster the implementation of new solutions to supply the country’s energy demand, while also avoiding the increase of greenhouse gas emissions.

This chapter presents an actual case of mitigation of greenhouse gas emissions through the provision of renewable energy utilising biomass residues (bagasse) from the sugar and ethanol production at Companhia Energetica Santa Elisa. Santa Elisa is the third largest sugar producer in Brazil and also the third largest electricity — producing sugar mill through cogeneration[19] [20]. The project results from Santa Elisa’s

decision to expand its cogeneration system to increase efficiency and aggregate value to the bagasse originated from its sugar milling process. Santa Elisa intends to validate its investment within the CDM. An agreement has already been signed with the Swedish government concerning the certificates that will accrue from the project.

The Brazilian Inter-Ministerial Commission on Global Climate Change, which is responsible for defining national eligibility criteria for the application of CDM in the country, has determined that renewable energy cogeneration projects meet the sustainable development criteria sought by the Brazilian government. In this context, both sugarcane-based products and electricity provision are considered essential for the sustainable development of Brazil. Thus, the Santa Elisa project has received official support.


The annual cut allowance of forests to the wood-processing industry is 1 million m3 and the Forestry Commission is responsible to ensure compliance to this law. However, the limit was not seriously observed until the enforcement of the ban on chainsaw operations in the country in 2000. More than 50 per cent of the cut allow­ance is attributed to sawmills in Kumasi, the most industrial timber city in Ghana. In fact, of the approximately 100 sawmills established in Ghana, 67 are in the Ashanti region, of which 65 are located in Kumasi and surroundings.

The wood waste associated with sawmilling activities in Ghana is of two categories. There are forest residues (leftovers from forest cutting) and residues from the wood-processing mills. The latter group of residues is envisaged for use in the cogeneration project presented here. Experts of the forest and wood industry in Ghana classify the volumes of residues from commercial wood-processing opera­tions as shown in Table 16.1. Of the different types of wood waste listed, only the sawdust has no competitive use.


In 1993, Santa Elisa’s cogenerating capacity was less than 13 MW. Until then, the company had focused on meeting its own energy demand only. In 1993, the power plant was enlarged and two 8 MW turbo generators were added. In 1998, the company shifted an old 4 MW turbo generator to a new 6 MW. As a result, the total installed capacity in 1999 was 31 MW. From 1994 until 2001, Santa Elisa was able to supply the grid with approximately 5 MWh during the harvest season which, in this region, serves to meet the needs of a town with approximately 60000 inhabitants.

Santa Elisa’s bagasse cogeneration project involves new investments to install new boilers and generators, and increase capacity and efficiency of the plant. At the same time, investments in the production of sugar and alcohol are being made, so that the steam consumption of the sugar production process is reduced to 400 kg of steam per ton of sugarcane crushed. The phases of the project are described below.


The timber industry in Ghana comprised about 134 wood-processing firms in 1996 (S-B. Atakora, 1999). It is the fourth foreign exchange earner in the country after gold, cocoa and tourism, and a heavy user of both electricity and heat. The industry has been constantly troubled with power outages due to power rationing in the entire country, especially in the dry season that lasts for almost a quarter of the year.

Meanwhile, this industry generates significant amounts of waste, which represent between 55 and 70 per cent of the total log input. This waste is in the form of sawdust, edgings, off-cuts and slabs which are suitable for power generation. It is estimated that about 3.7 million m3 of lumber was processed in 2001. This generated between 2.0 and 2.6 million m3 of wood waste of which only a fraction was used inefficiently in boilers to heat the kilns.

There are large quantities of sawdust currently causing nuisance in practically all the wood-processing areas of Ghana. The sawdust could be used to provide the energy needed in local industries, especially those located in periurban and rural areas where the energy crunch is felt most severely. Figure 16.1 shows a “mountain” of sawdust produced just over a single weekend operation in one of the medium­sized sawmills in the district of Kumasi. Most of this sawdust is disposed off mainly through open burning or dumping in pits at the sawmills. Besides posing great environmental hazards to the sawmills and the neighborhood, this implies the loss of significant biomass resources that could be used for energy purposes.

In 1998, the Kumasi Institute of Technology and Environment (KITE) conducted a prefeasibility study to look into opportunities of cogeneration using wood waste in Kumasi. The prefeasibility study established that:

• Cogeneration using residues of the wood-processing industry is feasible and has a great potential for meeting some of the energy requirements of the country.

Figure 16.1. Mountain of sawdust at one of the sawmills in Ghana. Source: Sawdust gasification for power generation in Ghana (Derzu and Brew-Hammond, 2001).

• The resource availability is enough to sustain cogeneration plants in the larger sawmills where continuous supply is assured.

• Kumasi is an ideal location for siting biomass cogeneration plants considering that about 60 per cent of wood-processing firms in Ghana are located here.

• Electricity tariffs in Ghana are at a level that makes cogeneration very competitive.

The above revelations led to the full feasibility study of a project, undertaken in 2001 by Econergy International Corporation (EIC) of USA in collaboration with KITE, under the auspices of the US Department of Energy. The feasibility study proposed a combined heat and power (CHP) plant with an installed capacity of 3.6MWe/9.3MW, h using steam turbine technology to be sited at the cluster of sawmills (Kaase) in Kumasi. The plant is projected to have an annual wood waste requirement of about 80000 m3. The CHP plant is to meet the power and heat requirements of the main sawmill, which is also the provider of the bulk of the wood waste (about 70 per cent), and a nearby brewery. This project is now possible as the Government of Ghana has liberalized the energy sector for independent power pro­duction (IPP). In addition, the project is perceived to have a good potential within the emerging CDM market.

Phase 1 — 2003

A high efficiency pressure boiler providing 65 bar at 200 ton of steam per hour and 510°C (the first in the sugar industry in Brazil) is installed. This implies a significant reduction of the amount of bagasse used per ton of steam generated. Two new contra pressure-type turbo generators at 15 MW each and two new condensing-type turbo generators at 6 MW are also installed. Other investments projected include the construction of a new powerhouse, a new sub-station with a new measurement equipment, and a transmission line. Also the bagasse deposit is doubled, reaching a capacity of 80 000 tons of bagasse, equivalent to a production of 8 MWh during 6 months.

Average amount of energy being exported in the years before the investment for energy producing and selling in 2003, as a marginal cogeneration of energy according to fuel availability and sugar mill consumption

** The Forecast is made upon PPA considerations and market expectations. For 2003 the PPA requires a supply of 30MW and provides CPFL with a buying option of 3MW, the rest can be sold on the spot market if SE wants so.

**’ Forecast of firm energy sales minus average energy sold before the investment in 2003, considering that the energy sold before was a marginal generation dependent on the availability of bagasse.

Santa Elisa deactivates two old generators and three less efficient 21 bar boilers. The production capacity increases to 58 MW. With these investments, Santa Elisa achieves an installed capacity between 30 MW and 40 MW to produce electricity to the grid during the harvest season of 2003 (see Table 15.1). Investments reach US$ 20.7 million in this first phase. For the local utility company, it is advantageous to buy energy produced by a sugar mill, as the base load for utilities in Brazil is supported mainly through hydro generation, and the sugarcane crop season coincides with the dry period. CPFL3 has signed a ten-year purchase contract with Companhia Energetica Santa Elisa.


The two direct beneficiary firms of the project (the sawmill providing the bulk of the wood waste and the brewery) have both access to the national grid. Thus, the project boundaries encompass the following:

• The biomass (wood waste) cogeneration plant (assumed to have zero emissions);

• The Aboadze thermal plant at Takoradi;

• The import of thermal power from la Cote d’Ivoire;

• The standby diesel generating sets at the two beneficiary firms used during power outages;

• The residual oils used in the boilers in the brewery;

• The biomass (wood wastes) burnt in the boilers of the sawmill (assumed to have zero emissions).

This project seeks to mitigate climate change by contributing to the reduction of greenhouse gas emissions. There is a looming power crisis from 2002 and the Ministry of Energy is considering bringing in emergency power barges to be run on crude oil. The imminent power crisis is due to the low water levels in the dams at

Akosombo and Kpong. These low water levels are the result of poor rainfall which is being attributed to the negative impacts of climate change.

Just as the project boundary is dynamic, so is the baseline. In the absence of the biomass CHP plant, the sources of anthropogenic emissions of greenhouse gases are:

• The hydropower from the Akosombo and Kpong dams (zero emissions);

• The Aboadze thermal plant at Takoradi running on crude oil (2003-2006);

• The Aboadze thermal plant at Takoradi running on natural gas from the proposed West African Gas Pipeline (2006-2020);

• The import of thermal power from la Cote d’Ivoire run mainly on natural gas;

• The standby diesel generating sets at the two beneficiary Firms used during power outages;

• The residual oils used in the boilers of the brewery;

• The biomass (wood wastes) burnt in the boilers of the sawmill (assumed to have zero emissions).

The issue of the timing of the emergency power additions are also applicable to the baseline scenario here. In addition, there is also the issue of the timing of the West African Gas Pipeline Project.

Phase 2 — 2004

During the harvest season of the year 2004, higher capacity and efficiency is reached through the acquisition of another 15 MW turbo generator, another 65 bar boiler, again targeting a steam consumption at 400 kg per ton of sugarcane crushed. The forecast is to produce around 216 GWh of clean energy annually to supply the regional grid.

Second phase investments are expected to reach approximately US$ 13 million. The investment to increase efficiency is dependent also on the expansion of sugar production. The financial support from certified emissions reductions (CERs) is

CPFL is a leading energy distributor in the State of Sao Paulo.

helpful in improving the mill competitiveness and enhancing the sustainability of the project as a whole.

Considering that the cogeneration depends on the biomass supply to the sugar mill boilers if, for some reason, agricultural operation or transportation is disrupted, the sugarcane will not reach the sugar mill and the boilers will not be able to produce the steam required. For this reason, the expansion plans for energy generation at Santa Elisa come together with significant investments in the sugar production process. The idea is to reduce steam consumption in the sugar production process to release as much as possible to cogeneration.