Biofuels

Biofuel is a renewable energy source that totally or partially replaces fossil fuels, in the form of biodiesel, hydrous or anhydrous ethanol, biogas and biomethane. Biofuels play an important role in the Brazilian energy matrix, characterized by diversity and the significant participation of renewable sources. Its adoption and its integration into the productive matrices of Brazil and Rio Grande do Sul contribute to the reduction of greenhouse gases and expand opportunities for income, employment and technological development.

Programs aimed at promoting biofuels in Brazil, associated with research and technological advances, have made the country a reference in its production. Biodiesel, derived from vegetable or animal fats, is used in compression ignition engines (Diesel Cycle). Its main raw material in the country is soy. Ethanol, hydrous or anhydrous, had its production leveraged for the first time as a substitute for gasoline.

Biodiesel is recent in the Brazilian energy matrix, having as a milestone the creation of the National Program for the Production and Use of Biofuel and the legislation that makes the addition of biodiesel to diesel compulsory. The blend requirement became effective in 2008, at a rate of 2%, which gradually evolved to 10% in 2019. In the last decade, biodiesel has consolidated its participation in the Brazilian energy matrix. The biofuel proved to be technically and economically viable and several studies attested to its environmental benefits compared to fossil fuels.

As of April 1, 2023, the minimum blend of biodiesel in diesel has been increased from 10% to 12%. A year later, in 2024, the percentage will rise to 13%. In 2025, it will reach 14%, and in 2026, it will reach 15%. In this scenario, Rio Grande do Sul, as the main producer of biofuels in the country, will be fundamental in increasing supply, as it has the largest installed capacity and a consolidated industrial park.

This jump in the supply of biodiesel will demand the expansion of investments in research, technological development and logistics, in addition to the diversification of raw materials, aiming at greater productivity and a reduction in final prices.

As advantages for the development of the sector, Rio Grande do Sul has the presence of raw materials and an installed production base that has a local network of suppliers involving the metalworking, electronics, automation, machinery and industrial equipment sectors, as well as a well-developed agro-industry.

Biofuel production in the state effectively began in 2007 with the installation of three companies: Oleoplan, in Veranópolis, BSBios, in Passo Fundo, and Granol, in Cachoeira do Sul. According to ANP data (2023), the State currently has eight biodiesel production plants installed and three ethanol production plants installed, being a national leader in the segment, accounting for 27.5% of national production, or 1,855,787 m³ . It is estimated that the production of biodiesel via family farming generates approximately 19,000 jobs in Rio Grande do Sul.

In June 2023, Petrobras announced the transformation of Refinaria Riograndense, in the city of Rio Grande, into the country's first biorefinery, with an initial investment of BRL 45 million. The initiative is part of a plan aimed at producing petrochemical products and fuels from entirely renewable sources at the unit. In the first test, the objective will be to prepare the refinery's FCC unit (fluid catalytic cracking) with innovations in the process and catalytic system, generating entirely renewable inputs, based on a technology developed by Petrobras' Research and Development Center (Cenpes). The subsequent test will be through the co-processing of fossil cargo with bio-oil, generating propylene, gasoline and diesel, all with renewable content from advanced raw material of non-food biomass.

In 2021, 6.8 billion m³ of biodiesel were produced in the country. Soy is the main raw material used, accounting for 72% of the biodiesel produced, followed by beef fat (7.7%) (EPE).

Sector Opportunities

Research and technological development to increase productivity and diversify crops to be used as raw material in biodiesel production.

Expansion of the number of plants due to the gradual increase in the proportion of biodiesel in the diesel mixture.