POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Identification of shortfalls and establishment of a workplan for the success of the Brazilian Biodiesel Program (BBP) Mauricio Cintra do Prado de Salles Penteado SAE World International Congress – Detroit USA April 2008 1 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering General scenario of Biodiesel in the World and in Brazil: • USA: until 20% (“Clean Air Act Amendment of 1990” and S-517 Law); • Europe: 2%, in 2005,and 5,75% in 2010 (“2003/30/EC of the European Parliament and of the Council of 8th May 2003”); • Brazil: Law 11097/2005: compulsory addition of 2% Biodiesel in 2008 (ca. 800 millions of liters) and 5% (ca. 2400 millions of liters) in 2013 (Brazilian Biodiesel Program) => Important Question mark: expected available production capacity of over 1.3 billions liters, but what is the percentage which will really attend Biodiesel specifications? 2 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Agro-economic aspects: Biodiesel Production Chain (ethanol x methanol / scale) PURPOSE OF THIS PAPER Logistics Tributes Quality (Besides simplified assumptions) • Oil or Fat + Methanol => Methylic Esther + Glycerol • Oil or Fat + Ethanol => Ethylic Esther + Glycerol 3 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Agro-economic aspects:request, agricultural requirements and shortfalls Brazil B2 request: ca. 800 millions of liters in 2008 North (9%) B2: 70 millions Northeastern ( 14%) B2: 115 millions Centre-South (77%) B2: 615 millions • North: PALM (shortfall: 5-year availability => shortfall for 2008); • Centre-South (except for Mato Grosso do Sul state): CASTOR AND SUN FLOWER (shortfall: manual process, not mechanized => ALTERNATIVE: SOYBEAN • Northeastern: CASTOR (shortfall: high viscosity => impact in application) • South-Western, South and Mato Grosso do Sul state: SOYBEAN (shortfall: oxidation stability => impact in application) 4 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Mass Flowchart of the Transestherification Process Oil or Fat + (M) Ethanol (M) Ethylic Esther (Biodiesel) + Glycerol Basic Formula: BIODIESEL COST = (soybean oil price) + (ethylic alcohol price) + (sodium hydroxide price) + (steam cost) + (energy cost) - (glycerine price); 5 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Ethylic versus Methylic routes of transestherification ...reminding that...: Oil or Fat + (M) Ethanol (M) Ethylic Esther (Biodiesel) + Glycerol Comparison of ethylic and methylic routes: 6 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Ethylic versus Methylic routes of transestherification ...reminding that...: Oil or Fat + (M) Ethanol (M) Ethylic Esther (Biodiesel) + Glycerol Comparison of ethylic and methylic esthers: 7 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Technological aspects of Biodiesel production: production costs: soybean, castor, palm, fried oil and cattle tallow • and how to totally supply the northern region for 2008? Answer: with Cattle Tallow ; • fried oil: complementary alternative 8 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Biodiesel Specifications : Quality and Performance Parameters The most significant Quality Parameters of Biodiesel are as follows: • remotion of free glycerine (free glycerine content); • remotion of residual catalist (ashes content); • remotion of reacting alcohol (flash point); • lack of free grease acids (total acidity) The most significant Performance Parameters in the injection systems, are as follows: • viscosity; • density (specific mass); • oxidation stability Oil or Fat + (M) Ethanol (M) Ethylic Esther (Biodiesel) + Glycerol 9 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Technological aspects of Biodiesel application: parameters, influence factors and technical alternatives • European engaged agreement: attend B5 without changes; • Suggestion for BBP Brasil: parallel controlled tests on B2 and B5: => veicular (fleet tests): 2 years => dynamometer (engines): 1 year • technical alternatives to supply shortfalls (soyben and castor): => additivation (2%) ; => blend of 30% castor and 70% soybean ; => Question mark: are they economically viable? 10 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Technical-economic analysis of Biodiesel in Brazil: simplified hypothesis, scenarios and calculation steps Criteria: Maximum Net Income and Maximum Employment Generation Estimated scenarios (total of 27 different situations according to the region versus oilseeds): • scenario (A): substitution of brazilian importation of Diesel Oil by produced Biodiesel; • scenario (B): introduction of Diesel oil / Biodiesel in part of the brazilian light vehicles (5% 2008 and 15% 2013) in Brazil (currently forbidden); • scenario (C): composition of scenarios (A) and (B) Calculation steps: • (I) Sensitivity analysis of Biodiesel prices regarding scenarios (A) and (B): Federal tribute “PIS/COFINS”: 23% ; State tribute “ICMS” + Distribution Margin + Logistics: 43% ; Petrol / Gas Station Distribution: 13% => Total incidence of Tributes: 85% • (II) Application of progressive subsidy relating to the tributes above ; • (III) Impact of the total net income and of the employment generation to the government, in the composition of scenarios (A) and (B), by region / oilseed [2008(B2) / 2013 (B5) ] => Soybean + ethanol: 113 jobs / millions of liters => Castor + methanol: 537 jobs / millions of liters => Palm + ethanol: 43 jobs / millions of liters => Cattle Tallow + ethanol: 15 jobs / millions of liters 11 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Technical-economic analysis of Biodiesel in Brazil: calculation steps (continuation) e analysis of Results Analysis of Results: • Fried Oil and Cattle Tallow economically viable to the customer under any tribute conditions; • the Soybean is only economically viable to the customer by applying 13% to the patrol/gas station, and by exempting all the other tributes; • Castor is economically unviable to the final customer, even by exempting all the tributes; the only alternative to viabilize it would be by applying 67% of goverment subsidy; • Castor unviabilizes scenario (B), and, consequently, scenarios (A) and (B), but not (A); • it is only economically viable to apply 2% additivation, but not to make blend of oilseeds (such as 30% castor + 70% Soybean) • the application of 67% of government subsidy in Castor, aiming at viabilizing it to the customer, will result in negative unit (per liter) net income to the government, for the northern region, even by destinating the transestherification investiment to the private sector; • for the viable scenarios subsequently described, the Castor negative net income impact, for the northern region, will be compensated by the positive net income of the the other oilseeds, within the scenario (A). 12 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Technical-economic analysis of Biodiesel in Brazil: Analysis of Results (continuation) 13 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Technical-economic analysis of Biodiesel in Brazil: Results (continuation) Best obtained results with the oilseeds (number of oilseeds): • Scenario (A): substitution of Diesel importation by Biodiesel => 2 ; • Scenario (B): introduction of Diesel / Biodiesel in light vehicles em veículos leves => 3 ; • Scenario (C): (A) + (B) => 2 Inference of vehicle parallel comparative validation tests, with B2 and B5, via fleet tests, necessary to viabilize the Brazilian Biodiesel Program (BBP) in 2008 (B2) and 2013 (B5): • preliminary analysis of 2 types of fuel: - so-called “new” (as per specification) for B2 and for B5 (based on B2) - so-called “old” (similar to the new one, except for storage period of until 12 hours) • new vehicles with “new” fuel; new vehicles with “old” fuel”; • “old” vehicles (100 000 km) with “new” fuels; “old” vehicles with “old” fuels ; • estimated timing for test executions: 2 years 14 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Brazilian Biodiesel Program (BBP) Action Plan: Vehicular tests Inference of vehicle parallel comparative validation tests, with B2 and B5, via fleet tests, necessary to viabilize the Brazilian Biodiesel Program (BBP) in 2008 (B2) and 2013 (B5): • vehicle categories: => light passenger vehicles, with injection systems of rotating pumps and electronic common rail systems; => light commercial vehicles (pick-ups, minivans e mini-buses), with injection systems of rotating pumps and electronic common rail systems; => medium and heavy commercial vehicles (trucks), with injection systems of alternate unit pumps and electronic common rail systems; => medium and heavy commercial vehicles (buses and trucks), with injections systems of unit injection pumps and electronic common rail systems • Number of necessary vehicles for the following scenarios: - Maximum Net Income: (1a+1b): 64 vehicles [4 test conditions x 2 Biodiesel contents x 4 vehicle categories x 2 oilseeds] - Maximum Employment Generation: (2a): 72 vehicles [4 test conditions x 2 Biodiesel contents x 3 vehicle categories x 3 oilseeds] 15 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Brazilian Biodiesel Program (BBP) Action Plan: Dynamometer Engine tests Inference of vehicle parallel comparative validation tests, with B2 and B5, via fleet tests, necessary to viabilize the Brazilian Biodiesel Program (BBP) in 2008 (B2) and 2013 (B5): • preliminary analysis of 2 types of fuel: so-called“new” / “old” (similar to the previous item); • new engines with “new” fuel ; new engines with “old” fuel; • estimated timing for test execution: 1 year; • Number of necessary engines for the following scenarios: - Maximum Net Income: (1a+1b): 32 engines [2 test conditions x 2 Biodiesel contents x 4 vehicle cathegories x 2 oilseeds] - Maximum Employment Generation: (2a): 36 engines [2 test conditions x 2 Biodiesel contents x 3 vehicle cathegories x 3 oilseeds] 16 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Vehicular comparative validation tests with B2 and B5 (pattern extract) 17 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering Engine Dynamometer comparative validation tests with B2 and B5 (pattern extract) 18 POLYTHECHNIC SCHOOL OF THE UNIVERSITY OF SÃO PAULO (POLI-USP) Professional Master Course in Automotive Engineering THE END THANK YOU ! 19