low-carbon biofuel from Brazilian
The international market for biofuels is growing driven largely by the need to reduce greenhouse gas emissions from transport. Sustainable biofuels are expected to play an increasingly important role in helping to meet fuel needs and reduce CO2 emissions.
Shell has a 30-year history of biofuel development and investment. The production, purchase, trading, storage, blending and distribution of biofuels are part of our everyday business. We are one of the world’s largest distributors of biofuels and we continue to build capacity in conventional biofuels that meet our corporate and social responsibility criteria.
Ethanol produced from sugar cane in Brazil can reduce net CO2 emissions by up to 70% compared with gasoline. In 2011, Shell and Cosan launched the Raízen biofuels joint venture (Shell interest 50%) in Brazil to produce ethanol, sugar and electricity, as well as supply, distribute and sell transport fuels. With a production capacity of more than 2 billion litres per year (35 thousand b/d) of ethanol from sugar cane, Raízen is one of the world’s largest ethanol producers. The deal marked Shell’s first move into the mass production of biofuels. In 2014, Raízen commissioned a second-generation biofuels plant, which will use technology from Iogen Energy to produce about 40 million litres of cellulosic ethanol a year from leaves, bark and other sugar cane waste. Additionally, Raízen acquired the fuel distributor Distribuidora Latina and its network of more than 200 retail stations.
In 2007, we introduced environmental and social clauses into the contracts for the bio-components that we purchase for blending. We continue to monitor how well our suppliers adhere to those clauses. We are also working with non-governmental organisations, policymakers and industry groups to develop and promote robust global standards for ensuring the sustainability of biofuels production.
New advanced biofuels technology can turn feedstock such as woody biomass or inedible plants into high-quality fuels, while reducing CO2 emissions. In 2012, Shell announced plans to build an advanced biofuels pilot plant at our Westhollow Technology Center in Houston, USA, to produce drop-in biofuels, or fuels which, unlike ethanol, are chemically similar to those derived from oil. The Westhollow plant will explore using a range of inedible biomass to produce a range of products, including gasoline, diesel and jet fuel. If successful, Shell aims to begin production toward the end of the decade.
In addition to our Westhollow programme, we continue to have dedicated biofuels research teams and research agreements with experts in leading academic institutions across the world. We also have technical partnerships with leading companies exploring new technology platforms for the production of advanced biofuels.