Outlook for ethanol production costs in Brazil up to 2030, for different biomass crops and industrial technologies

Abstract

This paper presents an economic outlook of the ethanol industry in Brazil considering different biomass feedstocks and different industrial processing options. A spreadsheet model was designed to account for different feedstocks and industrial processes, and expected trends in biomass yield, sugar- and fibre content, industrial scale and efficiency. Sugarcane and energycane cultivation costs may be reduced from 35 US$2010/TC in 2010 to 27 US$2010/TC and 22 US$2010/TC in 2030 respectively. Eucalyptus and elephant grass cultivation costs could be reduced from 32 to 23 US$2010/tonne wet and 38 to 26 US$2010/tonne wet for eucalyptus and elephant grass. Total ethanol production costs of first generation processing may decrease from 700 US$2010/m3 in 2010, to 432 US$2010/m3 in 2030. First generation ethanol production costs may decrease by reduced feedstock costs, increase in sugar content, utilization of cane trash, and use of sweet sorghum. Furthermore, the improvement in industrial efficiency of the first generation process, increasing industrial scale and change to an improved technology are other measures. For second generation technology utilizing eucalyptus, the total ethanol production costs could be strongly reduced to 424 US$2010/m3 in 2030. Costs reduction measures for second generation industrial processing include reduced feedstock costs, increasing industrial efficiency and scale, and a change to more advanced industrial process. Overall, biomass yield, increase in sugar content of sugarcane, and improved industrial efficiency are important parameters in total ethanol production costs. Ongoing RD&D effort and commercialization of second generation industrial processing may result in the lowest ethanol production costs for second generation processing in the future.