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Raízen and Shell sign an agreement to build five new cellulosic ethanol plants between 2023 and 2027, at a cost of BRL 6 billion

Written by Valdemar Medeiros
Published 09/11/2022 às 23:09
Updated 10/11/2022 às 09:59
Raízen and Shell sign an agreement to build five new cellulosic ethanol plants between 2023 and 2027, at a cost of BRL 6 billion
Photo: EPBR/Reproduction -Raízen

Raízen and Shell sign an agreement to develop 5 new cellulosic ethanol plants by 2027. The companies will invest BRL 6 billion in the biofuel, which is 93% more sustainable than gasoline.

This Monday (7), the root, a bioenergy company and the oil company Shell announced a ten-year agreement for the production of 3,3 billion liters of cellulosic ethanol. A Shell controls the company alongside the Cosan group. The company's intention is to become the largest producer and seller of ethanol generated from waste. In this way, companies aim to install new fuel production factories.

Raízen and Shell will build new cellulosic ethanol plants

The companies' operation is part of the strategy to position Raízen as a protagonist in the energy transition. This was one of the commitments made to investors during the company's IPO process.

In August 2021, the company's initial public offering (IPO) moved more than BRL 6 billion. According to the agreement with Shell, Raízen must build 5 new cellulosic ethanol plants between 2023 and 2027, at a total cost of BRL 6 billion. Each should take an average of 22 months to complete. The start of production of cellulosic ethanol at the new plants should take place in 2025.

In this way, Shell will be responsible for purchasing 80% of the ethanol production, the remainder to be sold to other companies. During the term of the contract, Raízen should receive around 3,3 billion euros. Cellulosic ethanol has the same chemical composition as regular ethanol.

The difference is that it uses the remaining bagasse from the production of sugar and common ethanol to produce more fuel. Compared to conventional, second-generation ethanol emits around 80% less greenhouse gases. In comparison with gasoline, this number rises to 93%.

Shell and Raízen partner with USP to develop green hydrogen

In September, the University of São Paulo (USP) announced a partnership with companies in the fuel sector to develop a technology that can turn ethanol into green hydrogen. The cooperation agreement was signed with Shell Brasil, Raízen, Hytron and CETIQT.

The agreement estimates the construction of two new factories on the USP campus for the generation of green hydrogen, which will be used and tested on buses in the University city. According to Shell Brasil's low carbon technology manager, Alexandre Breda, the objective of the initiative is to place ethanol as a source of green hydrogen.

The aim of the project is to develop equipment called a reformer, which breaks down the biofuel molecule to transform it into hydrogen. The ethanol used by the new USP factories in the process will be offered by Raízen, the largest sugarcane ethanol producer in the world.

Raízen invests BRL 1 billion in its third cellulosic ethanol plant

In October, Raízen inaugurated the key piece of its third second-generation ethanol unit, which makes up the company's ongoing effort to strengthen its development strategy centered on energy solutions and sustainable goods.

The unit will be connected to the Bioenergetic Park Univalem, in Valparaíso (SP), with a production capacity of 82 m³ per year of Ethanol and is expected to start operating in 2024. The new factory will have an investment of R$ 1 billion. During the construction of the new unit, around 168 direct jobs will be generated, in addition to 1 indirect ones.

Carbon dioxide is one of the main pollutants causing the greenhouse effect, responsible for global warming, E2G is an important product for the transition to a sustainable energy system.

Valdemar Medeiros

Journalist in training, specialist in creating content with a focus on SEO actions. Writes about the Automotive Industry, Renewable Energy and Science and Technology

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