D.

Santosh Kumar(09031EIB47)
Vamsi Muvvala(09031EIB63)
Class of 2011
MBA – IB
SMS JNTUH
BIO – FUEL (ETHANOL)
Bio fuel is available in solid, liquid, gas states.
• Derived from recently dead biological material (carbon
source), different from fossil fuels.
•Most common sources are photosynthetic plants and
plant derived materials.
•Mostly used in
•Power vehicles,
•Cooking stoves.
•Expanding in Europe, Asia & America.
•Used widely in cars at Brazil.
•Principal suppliers
•U.S.,
•S.A &
•Europe.
•2007 world’s production – 40 million tones.
•88% production by U.S &Brazil.
•Ethanol plants are increased by 15% from 2006 to
2007
- Renewable Fuel
Association (RFA)
 Can be Manufactured by 3 Diff Processes
 Sugar cane Ethanol
 Corn Ethanol
 Lignocelluloses Ethanol
 Sugar-cane Ethanol : fossil fuel input some 10%-
12% of final energy and up to 90% CO2 reduction
compared with gasoline.

 Corn Ethanol: High energy input and much smaller

CO2 reduction (15-25%).

 Lignocelluloses Ethanol: Total energy input may

be higher than for corn ethanol, but most such
energy could be provided from biomass itself, with
CO2 reduction up to 70%.
 Bio Fuel Cost Drivers
 Feedstock
 Process
 Land and labor costs
 Credits for byproducts
 Agricultural subsidies
 Food (sugar) and oil market.
 Sugar-cane ethanol : $0.25-$0.40/litre of gasoline
equivalent (lge) on FOB, gasoline at $40-$50/bbl oil
prices.
 Ethanol from corn : $0.6-$0.8/lge on FOB
potentially reducible to $0.4-$0.6/lge.
 Lignocelluloses ethanol : At present over $1.0/lge,
reduce by 50% in a decade.
 With little modification in engine ethanol
& gasoline blend 5%-10%(E5-E10) can be
used.
 New flexi-fuel vehicles run on up to 85%
blends.
 In Brazil some vehicles are using 100%
Ethanol.
 Potential market: 45 EJ by 2050, Ethanol
could experience rapid expansion in North
America and Europe because of price
jumps in alternative fuels.
 2004-2005: Global Ethanol production inc. by
8%.
 2005 : 95 operating plants in U.S. with total
capacity of 16.4 bnl per year.
 2006 :additional 35 plants constructed with 25
bnl per year capacity.
 2005:Brazil has over 300 plants in operation, of
which 80 licensed in 2005.
 2009:increased sugar cane production by 40% As
a part of a Brazil’s new National plan.
 Expecting 45 EJ by 2050
A unit in Brazil
Current and projected costs of biofuels compared
with conventional wholesale gasoline and diesel
prices (FOB). Period: 2005-2030
 India imports nearly 70% of its annual crude petroleum
requirement, which is approximately 110 million tons. The
prices are in the range of US$ 50-70 per barrel, and the
expenditure on crude purchase is in the range of Rs.1600
billion per year, impacting in a big way, the country's
foreign exchange reserves.