Why we need to Establish a Bio Fuel Market in Nigeria.
While a lot of 1st world countries are moving towards sustainable Energy, establishing policies for a Green Economy, I believe Nigeria has the Capacity to Establish a Biofuel Market for Africa in specific an Ethanol producing Hub for Africa Nigeria is a country with Vast untapped land were Farming Of sugar Cane on an industrial scale could take place.
This would increases Employment Rates, It will cut short the countries dependence on Crude oil and petroleum products. Nigeria already being a Heavy populated country I believe the Transition into production of Ethanol will Drastically cut short pollution Numbers across the country, This would Engage more people across the country in Agricultural work and Economical development for the country.
what your about to read is a piece from my final Year thesis I hope you find the information posted interesting and educational, please feel free to post comments on any errors or misinformations.
Thank you.
Abstract
As most of us all know bioethanol is a principle fuel used as a substitute for petrol, which is mainly produced from the fermentation of sugar. The introduction to this report will give you an in depth in understanding of what ethanol is, how it’s produced, and the steps and processes used to facilitate it. The introduction will also discuss on the leading countries that manufacture and produce ethanol and the challenges they undergo. A case study on ethanol production will also be briefly explained. On the literature survey, you will show a more detailed explanation on ethanol production and what dry milling and wet millings are. It also explains the feedstocks, and most importantly how Brazil stabilized its energy market with ethanol production. This report will also provide a detailed Data Charts, Images, and useful tables related to the productions, and markets.
1. Introduction
Ethanol, also known as ethyl alcohol and grain alcohol is a colorless flammable liquid. The chemical formula is written as C2H6O or C2H5O. Ethanol has a boiling point of 172°C (77.8°C) and a lower heating value of 76,330 Btu. As a biofuel the main usage of ethanol is based on the transportation sector. Ethanol is produced from a variety of different feedstock’s that include; sugarcane, wheat, barley, potatoes, sorghum, sweet potatoes, and sugar beets. On a broader scale ethanol can be produced from any commodity that contains either starch or sugar.
The two major feedstocks that are used today in large quantities are corn the main feedstock in the United States and sugar cane the main feedstock in Brazil. In the following Chapter a more detailed explanation of these feedstocks will be given. One of the reasons why sugar cane is used to produce ethanol in Brazil is because of cost efficiency, Sugarcane is the least costly method used to produced large amounts of sugar, and the same concepts applies for the United States. The usage of corn is less costly in producing large quantities of starch. The two largest ethanol producers are the United States and Brazil. The United States produces 13.9 billion US gallons (52.6 billion liters) and Brazil 5.6 billion gallons (21.1 billion liters).
The current major challenges of ethanol production faced in Brazil are based on scientific challenges. One of the problems is the development of new technologies for bioethanol production from (first and second generation feedstocks) that exhibit positive energy balances and appropriate meets of environmental sustainability criteria. This focuses on the special emphases of selection of new yeast strains by genetic breeding, and recombinant DNA technology.
On this Report there will be a case study focused on Nigeria’s Ethanol production and basic information on Nigeria’s energy profile and policies to be implemented
2. Literature Survey
2.1. Potential environmental impacts of sugarcane ethanol production
2.1.1. Atmosphere pollution
Sugarcane fields in Brazil have been historically known to burn left overs to facilitate manual harvesting. It has been a dated management practice. Recently several attempts have been made to end this but all have been unsuccessful in many parts of the country. Due to law enforcement, however in the State of Gao Paulo, the largest sugar cane producing State in the country, their have been significant progress towards eliminating the old practice. An agreement was signed with the sugarcane industry to end sugarcane burning in areas with slopes lower that 12° before 2012. After this agreement was made there was a drastic decline in sugarcane burning in San Paulo from 65% of 2Mha to 16% 10.78Mha.
Yet until the ban is fully enforced onto the other states, the impact of ethanol production on the atmosphere continues to be a serious issue and should be considered in any assessment of environmental impacts of ethanol production. In Brazil studies have also shown the impact of sugarcane burning on the atmosphere in areas of intensive cultivation especially in the state of San Paolo. It has shown a consistent pattern of chemical composition in the rainfall, which is strongly influenced by the particulate matter in the atmosphere originating from the sugarcane biomass. These particulate matter concentrations were high especially in the burning seasons.
Human health problems have also been associated with the exposure of the high concentrations of particulate matter in the atmosphere. Such as, asthma, respiratory distress syndrome (RDS), COPD and other respiratory diseases. These diseases are common in sugarcane regions in Brazil. In addition to human health concerns toxic compounds emitted during sugarcane burning can impact aquatic and — ecosystems.
According to TSAO a Norwegian national research ethics committee, sugarcane burning is the largest cause of air pollution in the whole life cycle of ethanol production in Brazil, and the consequences are pervasive.
2.1.2. Water Quality
The impact of sugarcane ethanol production on water quality can be divided into two major categories. One is inherent to intensive agriculture with the use of fertilizers, pesticides and other toxic chemicals. These toxic chemicals contain heavy metals that are transferred to aquatic ecosystem via surface runoff or leaching. The other is more specific to sugarcane agriculture in Brazil and is associated with liquid waste generated during the process of ethanol production in the mills. The two main mills of ethanol production are later explained in the report.
Among the sources of pollution that has been extensively studied is the vinasse, that is a liquid waste generated in large quantities during sugarcane ethanol production. In average of 10–15 liters of vinasse are produced from labile organic carbon contact. Having a high biological oxygen demand, it also has high concentrations of essential nutrients such as potassium and nitrogen. These elements have the potential to enhance primary production in aquatic ecosystems and promote eutrophication. Eutrophication is the excessive richness of nutrients in a lake or body of water, frequently due to run-off from the land that causes a dense growth of plant life.
2.2 Energy profile
Nigeria is currently the largest oil producer in Africa and was previously the world’s fourth exporter of LNG in 2015. Nigeria’s oil production is hampered by instability and supply disruptions, while its natural gas sector is restricted by the lack of infrastructure to commercialize gas that is currently flared which is burned off.
2.2.1. Natural Gas
Nigeria’s natural gas covers a space of an estimated 180 trillion cubic feet, making Nigeria the 9th larges natural gas reserve holder in the world, and the largest in Africa. Nigeria produced 1.55Tcf of dry natural gas in 2014. The natural gas production is constrained by the lac of infrastructure to monetize natural gas that is currently flared.
2.2.2. LNG
Nigeria exports the vast majority of its natural gas in the form of LNG, and a small amount is exported via the West African pipeline (WAGP) to nearby countries. Nigeria exported about 900Bcf of LNG in 2014, ranking Nigeria the world’s fourth largest LNG exporter. Nigeria’s LNG exports accounted for about 8% of LNG traded globally. Japan is the largest importer of Nigerian LGN and imported 28% of the total in 2014.
2.2.3. Electricity
Nigeria has one of the lowest rates of net electricity generation per Capita in the world. Nigeria’s generation capacity was 10,022Mw in 2013 of that 7,892Mw was from fossil fuel sources. 2,040Mw (20%) was from hydro sources (78%)Mw from biomass, waste (1%), and 2Mw from wind (1%). The power sector in Nigeria suffers from poor maintenance of electricity facilities, natural gas supply shortages. Nigeria has set ambitious goals to increase generation capacity. Nigeria plans to increase generation from fossil fuel sources to more than 20,000Mw by 2020 and to increase hydroelectricity generation capacity to 5,690Mw by 2020 that’s tripling the capacity from 2012. This includes upgrading the current hydroelectricity plants and constructing new plants.
2.2.4. The case of Nigeria
Nigeria presently has a policy on bio-fuels entitled Nigeria bio-fuels policy and incentives (2007). This policy was approved by the (FEC) Federal Executives council on June 20th, 2007 and gazette as a national bio-fuel policy at the same time. The Nigerian national petroleum corporation NNPC was given a mandate to create an environment for the launch of a domestic ethanol fuel industry. The aim is to gradually reduce the nations dependence on importing gasoline, and of course reduce environmental pollution. At the same time creating a commercially viable industry that can precipitate sustainable domestic jobs. Which in turn will help increase the country’s employment rate. The policy’s framework is meant to create an enabling environment that is expected to sensitize and catalyze the development of the countries bio-fuels industry.
The bio-fuel program constitutes a major and unique attempt to integrate the agricultural sector of the economy with the down stream petroleum sector. To make the project an objective, the Nigerian federal government created renewable energy divisions through the Nigeria national petroleum corporations (NNPC). This move was to emphasize the implementation of the program. The implementation plan includes initial market seeding, a bio-fuel production program (PPP) to achieve 100% domestic production by 2020. A complete bio-fuel uptake, joint venture distillers. The policy is intended to create a market demand for bio-fuel products. About 4 billion US dollars has been committed to sugarcane sourced ethanol project in the northern state of Jigawa and Benue. While cassava-sourced ethanol project are embarked in the southern state of Nigeria.
The bio-fuel energy commission is implementing the responsibilities that will be exercised by the commission as follows;
1. Register all bio fuel plants/projects across the country
2. Issue license to bio-fuel operators for the production of fuel ethanol/ bio diesel in Nigeria
3. Periodically, review, access the economic, technical, environmental, and social impacts of the usage of bio-fuels and determine changes in the policies required when necessary.
4. Formulate and recommend fiscal, financial, and other incentive policies for the bio-fuel industry as well as protective measures if required.
5. Monitor the supply and utilization of bio-fuels and bio-fuels blends and recommend appropriate measures to the department of petroleum resources in case of shortages in the supply of bio-fuel and feedstock.
6. Review and adjust minimum mandated bio-fuel blend, as it deems appropriate.
7. Determine and put in place industry stabilization mechanisms
8. Designate and oversee the activities of the investment banks appointed to manage the bio-fuel industry equity fund.
Policies have been set in place with waivers being granted, and tax policies have also been established in order to create a wide range of incentives to the bio-fuels market. Research agencies have also been established to act as the central coordination body for bio-fuel research in the country. Collaboration was made with the government agencies and Para starters in bio-fuels policy development.
In conclusion the present Nigerian government needs to formulate policies that have legislative support, as is the case with Brazil. A need for a new legal framework that will enable the process of complementing traditional sources of energy with renewable energy sources like bio-fuel. The lack of enabling legislation in Nigeria’s energy sector has retarded the implementation of clean energy policies technical information on bio-fuel has also been hindered. There is a need for a public-private partnership in the development of bio-fuels in the country. The proposed partnership should optimize benefits amongst parties, either public or private, by allocating responsibilities to the party that best positioned to control the activity that will produce a desired result.
I believe the implementation of ethanol production in Nigeria will help boost many sectors including the private and public sectors. It will also cut down employment rates and improve power generation across the country. The country will also be less dependent on its natural resource that is fossil fuel.
Brief information on geography and agriculture
The sugar cane production can only take place in the middle belt and northern states of Nigeria. The reason why, the soil is located in those regions, and these regions are rich in organic matter with the ideal rainfall. However some of these states may sometimes lack sufficient rainfall, therefore the need for artificial irrigation is needed.
As some of us would know Nigeria is located in the tropical zone of West Africa and has a total land area of 923,770Km2. The country has three broad ecological zones that are distinguished in the country. They are the northern Sudan savannah zone or middle belt, and the southern rain forest zone. Total agricultural land is estimated at almost 71 million hectors that is 77 percent of the total area of the country. As of 2013, the cultivated area was 40.5 million ha (hectares) that has tremendously increased due to the recent push from the government for more people to invest in farming and agriculture.
In comparison to Brazils sugarcane production, Nigeria could also cover approximately 9.5 million hectares, basically 1% of the country’s land area. Sugarcane production would then take place in the three of the broad ecological zones, in the country as stated above. When you look at the prices of using sugar to make ethanol from varous sources you will see that the processing costs are low, but feedstock prices are high, however like Brazil I believe in Nigeria the sugarcane feed costs are significantly lower than in other countries. Sugarcane produces juice with 10–15% from which the sucrose is extracted. Not being able to find the specific number of mills running currently in Brazil, I suggested through my readings and understanding of the production that Nigeria could start with 5–10 government owned dry mill plants this will be used then as a test run to see it’s potential effect on the production and employment. After the government can issue license and land allocation to private investors.
Lets say we have approximately 10 dry mill ethanol power plant’s running under the government’s ethanol initiative scheme, each ethanol plant running an acre that will produce about 462 gallons from each acre that’s 6.620 gallons from all 10 plants. Though this wont have much effect on the total production of oil in the country, its just an example am using to start off with. Nigeria might need to start of with at least 100 ethanol producing plants each with about 30 thousand hectares of sugar acre plantation. I believe with these numbers and a constant production, we will definitely have an effect on the percentage of oil used in the country. The reason why I say so is cause once we have ramped up and constant production of ethanol that’ll challenge the oil production in the country that faces shortages in production and common scarcity.
This will also improve the environment and atmosphere have more cars moving on ethanol, which I will shortly talk about in the policy implementation.
3.1.2. Policy implementation
As I have previously talked about in this report Nigeria has policy on bio-fuels entitled “bio-fuels incentives” which was approved in 2007 The issue was that it was never fully implemented. What I am about to explain shortly are implementation processes that Nigeria could establish on which would help the country’s economy and the safety of its environment. The first aspect of implementation is the launch of a domestic environment in producing ethanol. How could this be done? This could be done by the allocation of major agricultural fields in the three broad ecological zones of the country. The would encourage foreign investors to put in their funds into Nigeria knowing the country has a policy that backs the support of ethanol production.
This will also diversify the country’s sources of revenue as additional taxes could be generated from commercial activities attributed to the ethanol industry. It will also create sustainable job opportunities for citizens and the empowerment of rural communities who are currently neglected from enjoying the national cake. Improving the agricultural benefits by advancing farming techniques and agricultural research.
3.1.3. Policy Structure
The policy has been structured into two major components inline with available agricultural land, research and development, and implementation strategy. The first phase of the program defined in the policy is “seeding and — -“ this involves the importation of commercial quantities of fuel ethanol to seed the market base on 10% ethanol blend (E-10). The 2nd stage of the program is called “biofuel production program” this will begin simultaneously with the seeding phase involving large-scale plantations using the massive agricultural land distributed across the country.
Looking at potential exports to other African countries like Niger Republic, Cameroon, and Chad the program will attract investment from both local and international companies. These are some of the investment incentives I was able to come up with through my research.
- The finding of research and establishment of biofuels agency to limit investment cost and access to any government subsidy by the companies.
- “Tax Holiday” all registered businesses engaged in activities related to biofuel production and the production of agricultural feedstocks for the purpose of biofuel production and co-generation within the country.
- Biofuel companies shall be exempted from taxation withholding tax and capital gains tax imposed under sections 78,79, and 81 of the companies income tax Act in respect of the interest of foreign loans, dividends, and services rendered from outside Nigeria to biofuels companies by foreigners.
- Wavers on custom and import duties: biofuels companies shall be exempted from payments of custom duties, taxes, and all other charges of similar nature. Also companies that are involved in the production of biofuels or feedstock and the generation of electricity from biomass shall be exempted from payment of value added taxes on all products and services consumed.
- The introduction of flex-fuel vehicles as the country later adjusts to its production of ethanol production and biofuels, well also take the similar approach taken in Brazil that was the introduction of flex-fuel vehicles.
“Flex cars” are cars that are able to run on hydrated ethanol (E100) or just a blend of gasoline with amounts of 20–25% concentrated grade of ethanol that could be produced by simple distillation. What these vehicles would do is help in reducing C02 emission on the transport system. Understanding Nigeria’s dense population this strategy would significantly help in bringing down the numbers on carbon emission making the environment healthy for the people living in it.
What the Nigerian government could do is slowly implement a policy stating all ‘gasoline’ imported or refined in the country should contain let’s say 5–6% of ethanol. A program should also be put in place that will help the country deal with the high trade deficits resulting from high imported crude oil prices. As we know Nigeria spends a lot of money on imported refined oil. I believe with this program in place it will help reduces Nigeria’s dependence on imported energy to a much lower degree.
3.1.4. Low Production
The Nigerian federal government as part of the ethanol production program could start with a low production initiative. It should have a small-scale power plant built that has a production capacity of four hundred thousand gallon/yr. What the federal government could do to grow the production rate is by implementing federal and state policies, regulations government incentives, such as motor fuel excise tax. This tax is imposed on the sale of fuel that are intended for transportation.
3.1.5. Moderate Production
Before the federal government moves from a lower production of ethanol to a moderate production I believe what they’ll need to do is a market assessment. It is necessary to accurately determine if market for the ethanol and products exist close enough to allow for economical distribution. The size of the market is defined by the quantities of ethanol and co-products that can be used directly on the farm or sold. The ethanol on farm use potential can be determined or sold. The ethanol on farm use potential can be determined from the consumption of gasoline and diesel fuel in current farming operations. A decision must be made on the degree of modification that is acceptable for farm equipment’s. The other few things Nigeria’s government needs to look at before moving from a low production rate to a moderate high ethanol production is the design of fuel plants.
The criteria affecting the decision to produce ethanol and establishing a production facility can be categorized into two groups; fixed and variable. The fixed criteria are basically how much ethanol and co-products can be produced and sold. The 2nd criterion is the plant as a whole order is to set up a framework or context for plant operations. The expense the operation can bear for labor must be considered. To some extent the latter concern is modified by the size of plant selected. The plant should be relatively easy to maintain and not require extensive expertise or expensive equipment.
3.1.6. Large Scale Production
In the case of large-scale production what I’ll do is use Brazils G-cut cycle that has an average productivity of 80 tones of sugarcane per hectare per year. Fertilization is provided by the use of vinasse and other ethanol industry by products and complemented with chemical fertilizers. The harvest would be done mainly manually that is the case Brazil that includes burning of sugarcane harvesting. This accounts for about 85% the remaining 15% of the harvest would then be mechanically done, without burning. An ethanol production industry with the capacity to process 8200 tones of sugarcane per day, corresponding to an area of 22 thousand hectares and a productivity of 821 of ethanol per tone of sugarcane was considered.
Conclusion
In the first part of this report I have given a brief information on ethanol production and some of the basic methods used, I then gave a comprehensive insight on two of the largest producing countries which are the United states and Brazil giving an in-depth in both countries producing quotes and issues concerning the Ethanol industry. In the course of my Report I also included a case study on Nigeria giving background information on its energy Portfolio and some of the policies implemented to help establish local based ethanol production. In the 2nd semester of my Report I focused on the implementation of Ethanol production program in Nigeria the entire country using the available research information, What I did was taking policies from Brazil and the US and Adjust them in such a a way that it’ll be feasible in Nigeria. I also took estimated figures in terms of production and see the effect it would make in Nigeria’s economy I then briefly explained how the possible implantation of flex fuel cars could be an option in Nigeria. In Conclusion through out my research and writing of this report I would like to conclude that Nigeria is a nation that would fully function on Ethanol and move from a country that depends on fossil fuel and the export of it. I believe with the right steps followed on implementation of policies we can make our environment cleaner and safer for our young generation, this can also improve the Economy by increasing the Employment rates across the country.
Though on this post I have made some major cuts as though they aren't necessarily important to the subject which is based on “ Nigeria Ethanol Production”.
Thank you.
References
1. Source: EIA based on information from International agencies
Available at: https://www.eia.gov/beta/international/analysis.cfm?iso=NGA
2. A Cellulosic Ethanol Milestone By Robert Rapier , CONTRIBUTOR
This column will be devoted to energy, the environment, and the economy
Available at: https://www.forbes.com/sites/rrapier/2016/04/26/a-cellulosic-ethanol-milestone/#2ffd1011072e
3. Source: GreenFacts
Available at: https://www.greenfacts.org/glossary/mno/membrane-filtration.htm
4. The Nigerian Bio-fuel Policy and Incentives (2007): A Need To Follow the Brazilian Pathway By Peter Kayode Oniemola and Gbenga Sanusi*
5. Feedstocks for biodiesel production: Brazilian and global perspective by Simone P. Souza,Joaquim E. A. Seabra &Luiz A. Horta Nogueira
6. Pages 1–24 | Received 03 Jul 2016, Accepted 09 Dec 2016, Published online: 31 Jan 2011 available at: https://www.usda.gov/oce/reports/energy/aer842_ethanol.pdf
7. C. Matthew Rendleman is with the Dept. of Agribusiness Economics, Southern Illinois University, and Hosein Shapouri is with the Office of Energy Policy and New Uses, USDA.
https://www.agmrc.org/renewable-energy/ethanol/u-s-ethanol-production-imports-and-stocks/
8. Source: U.S. Energy Information Administration, Weekly Petroleum Status Report
Note: 2017 values based on production through June https://www.eia.gov/todayinenergy/detail.php?id=32152
9. Brazil Ethanol Developments & Implications for the U.S. Ethanol Industry
Dr. Robert Wisner University Professor Emeritus Iowa State University and Biofuels Economist rwwisner@iastate.edu
10. Brazil’s Ethanol Industry: Looking Forward Constanza Valdes, cvaldes@ers.usda.govhttp://usda.mannlib.cornell.edu/usda/ers/BioEnergy/2010s/2011/BioEnergy-06-27-2011_Special_Report.pdf
11. Geography Nigeria http://www.fao.org/nr/water/aquastat/countries_regions/NGA/
12. Sugar Cane Statistics in Brazil http://sugarcane.org/media-center/faqs
13. Sugarcane Ethanol Production https://www.e-education.psu.edu/egee439/node/647
14. The Brazilian experience of flex-fuel vehicles technology: Towards low carbon mobility D. M. Vieira do Nascimento Faculty of Business, Economics and Social Sciences University of Hamburg/KlimaCampus, Germany
15. The Economic Feasibility of Ethanol Production from Sugar in the United StatesJuly 2006. By Office of Energy Policy and New Uses (OEPNU), Office of the Chief Economist (OCE), U.S. Department of Agriculture.
16. . A Guide to Small-Scale Ethanol Production by CHAPTER Ill
Basic Ethanol Production Published by
Technical Information Office
Solar Energy Research institute
