Agave program to enhance sustainability of energy markets

By Guil Signorini, Department of Horticulture and Crop Science, The Ohio State University

Brazil is frequently in the media spotlight to illustrate arguments on environmental issues and policies. The news often comes across as a set of bitter comments on weak institutions or the country’s inability to monitor and safeguard its forests. I put this conversation aside and invite the interested reader to focus on a positive analysis regarding energy supply and sustainable alternatives.

Applied economists, myself included, have published articles describing the history that led Brazil to hold one of the most sustainable energy mixes in the world. Despite challenges in revamping outdated macroeconomic policies and reducing the involvement of the central government in market matters in the past, citizens of the country today consume electricity that is 92% renewable. Hydroelectric plants have led the generation capacity charts since the 1980s, while more recently, windmills and biomass-based plants have increased their participation. Current data indicates that wind-based and biomass electricity account for 13.4% and 4.3% of Brazil’s electricity mix.

The numbers in the motor fuel market are almost as remarkable. Its green footprint relies heavily on the sugarcane industry, a $30 billion GDP industry responsible for producing 7.9 billion gallons of ethanol, 45.7 million tons of sugar, and operating 20.5 million acres of farmland. Sugarcane ethanol alone accounts for 16.4% of all motor fuel burned in Brazil. When combined with biodiesel and corn ethanol, the participation of renewables reaches a 24.8% share of the country’s fuel market. Comparatively speaking, renewables are blended in and account for 9.3% of the U.S. motor fuel market. It is true, however, that the absolute numbers are difficult to compare. The Brazilian fuel market is a fraction of the American — less than one-fifth. Between gasoline and diesel, Americans consume over 181 billion gallons annually, against 36 billion gallons in Brazil. Comparing the absolute renewable volumes, Brazil uses 8.9 billion gallons while the U.S. burns almost twice as much, 16.8 billion gallons.

The constraints of the fuel market in Brazil, nevertheless, have not hindered innovative and purposeful initiatives to continue rowing toward sustainability. Researchers from University of Campinas (Unicamp), Brazil, announced on Nov. 7, 2022, a partnership with Shell Oil Company to study applications of Agave tequilana as a feedstock for ethanol production. The plant’s name may sound familiar to most as it is the raw material for the alcoholic drink tequila, commonly produced and consumed in Mexico. The research program, called BRAVE (Brazilian Agave Development), captured approximately $6 million (dollars) to study agronomical practices, processing techniques, and the necessary value chain arrangements to establish a thriving industry in northeastern Brazil, a semi-arid region with limited capability to grow conventional food or energy crops.

It turns out that the BRAVE program departs from a set of findings obtained by the Aussies over a decade ago. Back in 2010, AgriFutures Australia (formerly called Rural Industries Research and Development Corporation) studied the feasibility of producing agave in rainfall-deprived regions of Queensland. The Aussies found that agave grows well with approximately 12 inches of water per year, yields 178 tons per acre after 5 years of crop establishment, and produces 31 gallons of ethanol per ton of harvested leaves. The annualized production of ethanol first generation (i.e., well-established fermentation processes) they obtained from the experiments was 1,094 gallons per acre, a 67% productivity gain versus sugarcane ethanol produced commercially in Brazil today.

Shell executives and Unicamp researchers project a long-term opportunity to grow agave in 4.9 million acres of idle semi-arid land in northeastern Brazil and produce 2.6 billion gallons of ethanol annually. The observant reader may notice that BRAVE projections are factoring in likely challenges establishing the agave industry in Northeast Brazil, considering the productivity potential obtained by the Aussies.

The same reader may be asking: What can we learn from all this? Researchers from University of California at Berkeley (UC) have made the first steps toward a complex answer. Through a simulation study conducted in 2015, the UC researchers identified the potential for agave to be grown in areas of Arizona, California, and Texas. Based on a set of scenarios and keeping the access to railroads and infrastructure in consideration, they report between 9.1 and 72.8 million acres of suitable land for agave production. Combining results from the worst-case scenario of that study, where 9.1 million acres are suitable, with those obtained by the Aussies, we arrive at a potential to produce over 10 billion gallons of agave ethanol per year, roughly 59% of the current demand for renewable fuels in the U.S. today. For comparison, 10 billion gallons of corn ethanol requires over 20 million acres of farmland, considering an average crop yield of 173 bushels per acre and current industrial parameters. Not to mention, these projections rely on existing technologies available at arms’ reach distance to add sustainability to the overall U.S. energy mix.

The conversation may go on. Establishing innovative and purposeful energy crop value chains, in this case, a new agave chain in Southwest U.S., would alleviate our dependence on fossil fuels and address the long-lasting issue of farmland use — the often-heated food versus fuel discussion. Moreover, purposeful supplies of renewable fuels would reduce the pressure on prices at the gas station. While society seems at times to be waiting for new technologies to become cost competitive for the average consumer — whether electric or hydrogen-fueled cars — applied research could lead the way and use well-established technologies to foster sustainability now. Shell executives and researchers from Brazil and Australia may agree that technologies and energy value chains are not mutually exclusive. This is 2023! Shell Oil Company is investing $6 million to research ways to produce agave ethanol in deprived regions in northeastern Brazil. Will the U.S. take a piece of that action?