Addressing barriers to Carbon Capture and Storage in Developing Countries UTILITY AND INDUSTRY EXPERIENCE

Addressing barriers to Carbon Capture and Storage in Developing Countries UTILITY AND INDUSTRY EXPERIENCE Biomass CCS in Brazil Jose R. Moreira University of Sao Paulo September 8, 2011 World Bank Washington, DC

BCCS PROJECT IN BRAZIL The RCCS project designed based in the huge Brazilian experience in sugar, ethanol and bioeletricity production in the sugarcane mills. It stores CO2 from sugar fermentation carried for ethanol fuel production. This model is not unique to Brazil; can be used wordly in ethanol production from any feedstock, via biological route. Among the agricultural products used to produce ethanol sugarcane is the preferred option, not only in terms of cost but also because of its positive net energy balance The proposed project is globally significant because over 80 countries grow sugarcane; Brazil is a leader in technological innovation and competitiveness in sugarcane processing industries.

WHY TO DO IT? 1) Already a similar project under development Illinois Project by ADM 2) Capture from Industrial Sources 3) Cost is low compared with other CCS opportunities 4) Carbon payback time may be quite good for sugar cane 5) It is possible to achieve negative CO2 emissions 6) Saline aquifer very easy to identify; plenty of groundwater 7) Large potential for CO2 capture/large density of mills The CCS system instalation in the Sao Paulo State which holds 2/3 of all ethanol production in Brazil (200 mills) 8) Economic payback mainly through valorization of a new type of ethanol with negative emission. Some return due direct GHG mitigation

PROJECT TARGET Renewable CCS (RCCS) from biomass has been identified as one of the few existing possibilities to reduce CO2 concentration from the atmosphere (IPCC Special Report on Carbon Dioxide Capture and Storage, 2005; IPCC SRREN, 2011), given that presents the additional advantage of converting the overall CO 2 emission balance from the process into a negative one when deployed in a sugar cane-based ethanol plant. This project proposes the first step of a pilot CCS (identification of suitable storage site) for development of RCCS from CO 2 emitted from sugar fermentation in a demonstration plant at a sugar/ethanol mill in the state of Sao Paulo. The storage phase is the most challenging one in this kind of project. Although the capture of CO2 is a difficult step in the case of CCS activity from fossil fuel combustion, this is much easier in the case of sugar fermentation process given the high purity of the CO 2 generated and the fact that it flows at almost room temperature from the existing venting port of the fermentation vessel.

The implementation of the RCCS project will: Promote the utilization of a new production process of renewable fuel; Contribute to an expansion of another sustainable use of biomass for energy; Introduce new technology to the sugarcane industry; Lead to reduced greenhouse gas emissions with the CO2 capture and storage in Brazil; Enable the transfer of technology and knowledge and the spread of CCS projects; Bring a significant increase in the environmental status of the ethanol; Overcome the barriers to commercially-practiced collection and utilization of CO 2 capture and storage.

PROJECT BARRIERS 1.Establish CCS credibility and acceptability as a safe, reliable, long-term form of storage. There is insufficient technical and economic available information on CCS. 2.The financial viability of CO2 capture and storage from sugar fermentation industry has not been tested in commercial sugar mill operations, leading to difficulty of getting the financial support necessary to commercially exploit the CO2 capture and storage 3.There is insufficient information in the sugar sector regarding CCS and insufficient knowledge of CCS in the industry, scientific and technical sector in Brazil, and that could lead to a perception of CO2 capture and storage underground as environmentally harmful. 4.Lack of knowledge on CCS at federal and state level, including at the agencies that have to authorize the project, which can even negatively impact the necessary licenses to the project implementation. Capacity building will be a large component of the proposal and will include technical and scientific institutions. 5.Without a proven technology and the proper information regarding costs and investment requirement, makes it impossible to approach financial institutions to secure the kind of financial support that is needed to modify the industry installations to capture CO 2 from fermentation.

Potential Stakeholder CTC (Sugarcane Technology Centre) is a research and development centre for the sugar and ethanol industry UNICA Main sugar/ethanol association - works to promote new business opportunities for the sugarcane industries MCT/FINEP government agency that supports development and demonstration of technologies to reduce and eliminate perceived risks UNDP - UNDP s comparative advantage for the GEF in Capacity Building and Technical Assistance lies in its global network of country offices, its experience in integrated policy development, human resources development, institutional strengthening, and non-governmental and community participation. GEF/WORD BANK Approved a US$ 2.7 million grant PETROBRAS - The Brazilian oil and gas company Large interest in CCS due new oil exploitation (Pre-salt)

International view Brazil is taking an active role in CCS RDD&D with Petrobras, the national oil and gas company, by operating two CO2 storage pilot projects. One of the projects injects 400 t CO2/day into a saline formation one of the largest CO2 demonstration projects in the world. In 2006, Brazil also saw the creation of a new CO2 storage consortium called CEPAC. However, CCS regulatory framework is not yet fully developed in Brazil, which could delay CCS deployment in the country. Reality

A - BCCS PROJECT IN BRAZIL B - WHY TO DO?

The RCCS project was designed based in the huge Brazilian experience in sugar, ethanol and bioeletricity production in the sugarcane mills. It intends to store CO2 from sugar fermentation carried for ethanol fuel production This model is not unique to Brazil, but can be used in ethanol production from any raw material, via biological route, around the world Among the agricultural products that could be used to produce ethanol the sugarcane is the preferred option, not only in terms of cost but also because of its positive net energy balance The proposed project is globally significant because over 80 countries grow sugarcane, and Brazil is viewed internationally as a leader in technological innovation and competitiveness in the sugarcane processing industries The Brazilian project foreseen the CCS system instalation in the Sao Paulo State São Paulo holds 2/3 of all ethanol production in Brazil

1) Already a similar project under development ILLINOIS PROJECT

2) Capture from Industrial Sources Capture from industrial process streams has existed for over 80 years (IPCC 2007). Most facilities currently vent the CO2 to the atmosphere, although some compress it and sell it as food-grade or industrial CO2.

3) Cost is low compared with other CCS opportunities

4) Carbon payback time may be quite good for sugar cane

5) It is possible to achieve negative CO2 emissions

6) Saline aquifer very easy to identify

Schematic hydreological section of the Sao Paulo State Source: Mapa de Águas Subterrâneas do Estado de São Paulo, Governo do Estado de SP, 2005.

7) Large potential for CO2 capture/large density of mills Sugar cane production by municipality and ethanol sugar mills in operation

377 km 528 km

CARB California Air Resources Regulation

Potential Stakeholder CTC (Centro de Tecnologia Canavieira, or Sugarcane Technology Centre) is a research and development centre for the sugar and ethanol industry UNICA works to promote new business opportunities for the sugarcane industries MCT/FINEP government agency that supports development and demonstration of technologies to reduce and eliminate perceived risks UNDP - UNDP s comparative advantage for the GEF in Capacity Building and Technical Assistance lies in its global network of country offices, its experience in integrated policy development, human resources development, institutional strengthening, and non-governmental and community participation. GEF/WORD BANK Approved a US$ 2.7 million grant PETROBRAS - The Brazilian oil and gas company

Brazil is taking an active role in CCS RDD&D with Petrobras, the national oil and gas company, by operating two CO2 storage pilot projects. One of the projects injects 400 t CO2/day into a saline formation one of the largest CO2 demonstration projects in the world. In 2006, Brazil also saw the creation of a new CO2 storage consortium called CEPAC. However, CCS regulatory framework is not yet fully developed in Brazil, which could delay CCS deployment in the country.

PROJECT BARRIERS 1.The big challenge is to establish CCS credibility and acceptability as a safe, reliable, longterm form of storage. There is insufficient technical and economic available information on CCS. 2.The financial viability of CO2 capture and storage from sugar fermentation industry has not been tested in commercial sugar mill operations, leading to difficulty of getting the financial support necessary to commercially exploit the CO2 capture and storage 3.There is insufficient information in the sugar sector regarding CCS and insufficient knowledge of CCS in the industry, scientific and technical sector in Brazil, and that could lead to a perception of CO2 capture and storage underground as environmentally harmful. 4.Therefore, one barrier is the lack of knowledge on CCS at federal and state level, including at the agencies that have to authorize the project, which can even negatively impact the necessary licenses to the project implementation. Capacity building will be a large component of the proposal and will include technical and scientific institutions. 5.Not having a proven technology in place and the proper information regarding costs and investment requirement, makes it impossible to approach financial institutions to secure the kind of financial support that is needed to modify the industry installations to capture CO 2 from fermentation. Thus, a barrier that arises is the difficulty of getting the financial support necessary to commercially exploit the CO 2 capture and storage.

THANK YOU VERY MUCH Jose Roberto Moreira National Reference Center on Biomass, Institute of Electrotechnology and Energy, University of Sao Paulo and MGM Innova Company rmoreira69@hotmail.com jrmoreira@mgminnova.com