sugarcane technology center ctc, piracicaba, são paulo · case study on biofuels in the aviation...

Case Study on Biofuels

in the Aviation Industry

Arnaldo Vieira de Carvalho

Inter-American Development Bank – IDB

Energy Division

Infrastructure and Environment Department

Washington, DC arnaldov@iadb.org; +1 202 623 1719

Expert Workshop for the How2Guide for Bioenergy 27-28 November 2014

Sugarcane Technology Center – CTC, Piracicaba, São Paulo

Inter-American Development Bank - IDB

• Oldest regional development bank (1959): 48 member countries

- 26 borrowers (with >50% votes in the Board); HQs in Washington, DC, offices

in all borrowing countries; finances both private and public sector projects, with

or without sovereign guarantees. The IDB Group encompasses 3 institutions:

the Inter-American Development Bank, the Inter-American Investment

Corporation – IIC and the Multilateral Investment Fund - MIF.

Note: * Latin America and the Caribbean

• Main source for LAC* regional financing

Approved loans/guarantees: US$230 billion (US$12 billion/y)

Overall leveraged investments: US$500+ billion

Non-reimbursable technical cooperation: US$ 6 billion (US$800 million/y)

• 25% of portfolio now directed to climate change & clean energy

www.iadb.org

www.iadb.org/biofuelsscorecard

IDB Scorecard for Sustainable Biofuels

Examples of grant support to biofuels

- US-BR MOU: Haiti, Guatemala and Honduras

and DR Phase II to evaluate specific projects

- Mesoamerican Biofuels Network

- 2nd Gen Biofuels in Chile (Consorcio ForEnergy)

- Support to most LAC countries on biofuels

- New HIO under UN SE4ALL initiative

Main aspects of biofuels for aviation x passenger cars

• Key decision by aviation stakeholders: “drop-in” fuel, i.e., no need

for any modification in turbines or storage/distribution systems (as

opposed to ethanol for passenger cars that require flex-fuel cars or

converted/adapted engines).

• Technical standards, fuel specifications and safety/quality control

norms are uniform worldwide (non-existent in the ethanol/biodiesel

markets):

Smaller number of consumer points (# airports vs. # gasoline

stations)

Jet fuel less exposed to subsidies/tariff distortions

• Stakeholders consensus: airlines, aircraft/turbine manufacturers,

fuel producers, government agencies, all joining efforts (not seen in

the ethanol/biodiesel market).

• No mandate for biojet fuel blending, as seen for ethanol and

biodiesel

2010 2020 2030

1.00

Rela

tive

CO

2

in

cre

ase

growth (w/ no improvement)

carbon-neutral growth 2020+

alternative fuels fill the gap,

together with market tools

w/ aircraft technology improv.

w/ operational improvements 1.50

Aviation committed to carbon-neutral growth

ASTM D7566 approved in Sept 2009 synthetic fuels for aviation (for the 1st

time), and in July 2011 established requirements for renewable sources.

2040

50% by 2050, with

respect to 2010

Approved

Date Airline/sponsors (country) Aircraft Turbine

manufacturer Biofuel producer Feedstock Technology

Nov 2010 TAM (Brazil) A320 CFMI UOP Jatropha HEFA*

Apr 2011 InterJet (Mexico) A320 CFMI UOP Jatropha HEFA

Aug 2011 Aeromexico (Mexico-Madrid) B777-200 GE UOP Jatropha HEFA

Sept 2011 Embraer (Brazil) EMB 170 GE N/A Camelina HEFA

Sept 2011 Aeromexico 29 flights

(Mexico-Costa Rica) B737-800 CFMI UOP Camelina HEFA

Oct 2011 Iberia (Spain-Mexico) A320 CFMI UOP Camelina HEFA

Mar 2012 LAN (Chile) A320 CFMI Air BP Copec Used cooking oil HEFA

Jun 2012 GOL/IDB/others (Brazil) B737-800 CFMI UOP Used cooking oil,

non-edible corn HEFA

Jun 2012 Azul/Amyris/GE/

Embraer/IDB/others (Brazil) EMB 170 GE Amyris Sugar cane DSHC**

Jun 2012 Aeromexico

(Mexico-Brazil) B777-200 GE UOP/SkyNRG

Used cooking oil,

jatropha, camelina HEFA

Aug 2013 LAN (Colombia) A320 CFMI Air BP Copec Used cooking oil HEFA

Oct 2013 GOL/IDB/Boeing/others

(Brazil) B737-800 CFMI UOP

Used cooking oil,

non-edible corn HEFA

June 2014 GOL/IDB/Boeing/others

365 flights (Brazil) B737-800 CFMI UOP

Used cooking oil,

non-edible corn HEFA

July 2014 GOL/IDB/Amyris/others

(US-DR-Brazil) B737-800 CFMI Amyris Sugar cane DSHC

LAC biojet fuel flights (2010-2014)

Notes: * Hydro processed Esters and Fatty Acids ; also known as Bio-Synthetic Paraffinic Kerosene (SPK) or Hydrotreated Renewable Jet ( HRJ); ** Direct Sugar to

Hydrocarbons

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1st activity: Life cycle assessment of Carbon emissions during the

production and utilization of biojet fuel from sugar cane (DSHC):

82% reduction on carbon emissions; and Benchmarking of

Biofuels Sustainability Standards co-financed with Embraer and

Boeing

IDB Initiative for Sustainable Aviation Biofuels

Support demonstration (experimental)

flights with Azul Airlines (1st ever with

DSHC) during Rio+20

IDB Initiative for Sustainable Aviation Biofuels

and GOL (as part

of ICAO Flightpath) using different

feedstocks.

Brazil’s first commercial biojet fuel flight, CGH-BSB on October 24th, 2013,

following approval of Resolução ANP Nº 20; DOU 25 June 2013 for HEFA

IDB Initiative for Sustainable Aviation Biofuels

365 biojet fuel flights

during World Cup

between host cities and

support to MG/

Brazilian/Panamerican

Biojet fuel Platforms

See video: http://www.iadb.org/en/topics/energy/se4allamericas/renewables,17688.html

Brazil State-level tax (ICMS) applied to jet fuel could be

reduced (to 4%) to promote commercial flights during 2 yrs

Possible tax-incentives for aviation biofuels in Brazil?

Source: IDB-Embraer White Paper. Sept 2013

1st commercial flight using

sugarcane-derived biojet fuel:

July 30, 2014

• Example of technical assistance for ANAC: MIATA

computations at airport level for national goal of 15% biojet fuel

penetration in domestic operations (assuming 40% maximum blend

at a single airport: operations in top 4 airports would be sufficient)

Rank Airport Share of

domestic

jet fuel use

Maximum share of alternative fuel from

airport total use

40% 30% 20%

1 SBGR-Sao Paulo 14% 40% 30% 20%

2 SBBR-Brasilia 10% 40% 30% 20%

3 SBSP-Cong. 7% 40% 30% 20%

4 SBGL-Rio 7% 37% 30% 20%

5 SBKP-Viracopos 5% 30% 20%

6 SBRF-Recife 5% 30% 20%

7 SBSV-Salvador 5% 9% 20%

8 SBCF-B. Horiz. 5% 20%

9 SBRJ-Rio SD 4% 20%

10 SBFZ-Fortaleza 4% 20%

11 SBPA-P. Alegre 4% 20%

12 SBCT-Curitiba 3% 20%

13 SBBE-Belem 3% 17%

14 SBEG-Manaus 3%

15 SBCY-Cuiaba 2%

IDB Initiative for Sustainable Aviation Biofuels

• Feasibility study of the first HEFA commercial plant for production of

biojet for ASA of Mexico. Two alternatives were contemplated:

processing 2,000 and 6,500 barrels per stream day (bpsd) of refined

vegetable oil.

IDB Initiative for Sustainable Aviation Biofuels

Study on Camelina in Argentina:

feasibility of cultivation in marginal

areas in south of the country,

includes analysis of economic,

social and environmental issues.

IDB Initiative for Sustainable Aviation Biofuels

19

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Advisory Board

Ban Ki Moon & Jim Yong Kim

Co-Chairmen

Global Facilitating Team

Kandeh Yumkella

CEO

Regional Hubs

IDB, AfDB & ADB

RE & EE Hubs

High Impact Opportunities

Executive Committee

Chad Holiday

Chairman

SE4ALL Global Initiative

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Grants to ideas or innovative concepts about biofuels, renewable energy, EE, rural electrification; replicable, with scale up prospects

IDEAS Contest (www.iadb.org/ideas)

IDEAS 2009: 1094 proposals; 26 winners; < US$ 200k each; US$ 5 million;

November 2010 Cartagena workshop

IDEAS 2011: Incorporates lessons learned: online proposals and updated

selection methodology; 353 proposals; 9 winners; < US$ 400k each;

US$ 2.5 million

IDEAS 2012: Focus Caribe (< US$ 200k each); 8 winners; US$ 1.5 million

IDEAS 2013: SECCI, Korea, GDF SUEZ, NDF, MIF/FOMIN; < US$ 100k each

568 proposals; 10 winners

IDEAS 2014: receiving proposals until Jan 15, 2015

SENER/FSE/CONACYT, SECCI, MIF/FOMIN; < US$ 200k each

THANK YOU