Energy Plus Approach: Brazil and Colombia Case Study Country report 2015 September 2015 Final Version Global Network on Energy for Sustainable Development (GNESD) UNEP DTU Partnership UN City Marmorvej 51 2100 Copenhagen Ø Denmark Tel: +45 4533 5250 http://www.gnesd.org/ Acknowledgement: This report was prepared for the Global Network on Energy for Sustainable Development by the Research Group on Bioenergy (GBIO) of the Institute of Energy and Environment of University of São Paulo, Brazil and CentroClima at the Federal University of Rio de Janeiro, Brazil. Authors: Emilio Lèbre La Rovere, Suani Teixeira Coelho, Maria Fernanda Gómez Galindo, Osvaldo Lívio Soliano Pereira, Alessandro Bezerra Trindade. The front cover photo has been found through Flickr and is courtesy of DFID - The UK Department for International Development Suggested Citation: GNESD 2015. Country report (Brazil and Colombia). Biomass Residues as an Energy Source to Improve Energy Access and Local Economic Activity in Low HDI Regions of Brazil and Colombia (BREA). Report prepared for the Global Network on Energy for Sustainable Development by the Research Group on Bioenergy (GBIO) and CentroClima. Biomass Residues as an Energy Source to Improve Energy Access and Local Economic Activity in Low HDI Regions of Brazil and Colombia (BREA) (Revised Final Report, September 2015) Partner Institutions: Executive Summary Access to cleaner and affordable energy options is essential for improving the livelihoods of the poor in developing countries. The link between energy and poverty is demonstrated by the fact that the poor in developing countries constitute the bulk of an estimated 2.7 billion people who rely on traditional biomass for cooking and the overwhelming majority of the 1.3 billion without access to grid electricity (IEA, 2015a). The Brazilian Amazon region and isolated areas of Columbia, despite their national electrification rates of 99.5% and 97.1% respectively, account for about 2.4 million of people without access to electricity. When it comes to cooking this number grows eightfold, almost 20 million people within these two countries relying on the traditional use of biomass for cooking. In fact, 6% of Brazilians and 15% of Colombians cook using firewood (IEA, 2015b). The lack of modern and affordable forms of energy affects agricultural and economic productivity, opportunities for income generation, and more generally the ability to improve living conditions. Moreover, low agricultural and economic productivity, as well as diminished livelihood opportunities, in turn result in malnourishment, low earnings, and no or little surplus cash. This contributes to the poor remaining poor, and consequently they cannot afford to pay for cleaner or improved forms of energy such as fuels and equipment. In this sense, the problem of poverty remains closely intertwined with the lack of cleaner and affordable energy services. In this context, the main objective of this report, Biomass Residues as an Energy Source to Improve Energy Access and Local Economic Activity in Low HDI Regions of Brazil and Colombia (BREA), is to develop a better understanding of energy requirements for productive purposes among poor households in urban and rural areas of Brazil and Colombia (many of them in isolated regions), which could allow inputs for targeted policy i interventions. In aiming to do this, BREA analyzed the perspectives for increasing and improving access to energy and energy for productive uses, as well as to enhance the Human Development Index (HDI) of the low- income population selected. The goal was to combine the delivery of energy services with measures that generate cash incomes, following the Energy+ Initiative, as proposed by the United Nations Development Program (UNDP). Through the use of small power- and heat-generation technologies fed with urban and rural biomass waste, BREA aims to replace traditional biomass and fossil fuels so as to enable the electrification and improvement of local economic activities. This report found that existing technologies available in the two countries include, as a first step, photovoltaic panels, but that these are only usable for small types of power supply. Also, they are quite expensive systems, since most are still imported. Therefore, the use of biomass residues allows the production of greater amounts of power, mainly in areas where such residues are available in large quantities, as shown in this report. The main advantage of the use of biomass residues is exactly the potential to produce power for productive activities too, as well as contributing to reducing the negative impacts of the inadequate use of such residues (i.e., municipal solid waste and animal residues, which currently are discharged inadequately, and agricultural and wood residues, which are burnt in the open air or left in situ). The main difficulty identified by the study relates to the use of biomass residues for power production: a) Lack of funding (both private and from government). b) Low economic feasibility, since many municipalities are too small, and households are more dispersed in rural areas, mainly in the Amazon regions of Brazil and Colombia. c) Lack of local capacity-building to operate and maintain some of the technologies. ii d) Lack of political will. Regarding the technologies proposed in this study for the recovery of biomass residues, each one has a different situation: a) Biodigestion. A technology already marketed in Brazil, but not used much as yet in rural areas. Despite some efforts in Colombia, the technology has not been widely implemented for power-generation purposes in rural and isolated areas. Hence, it is necessary to develop a large and widespread program in such regions. b) Small-scale combustion (steam cycles). A technology already fully marketed in Brazil by TGM Turbines1 (from 200 kWe and up, and exported to other Latin America countries such as Colombia). c) Small-scale biomass gasifiers (up to 200 kW). A technology already available but not yet fully marketed. Some pilot plants were implemented in the Amazon region using agricultural and wood residues (e.g. the Gaseifamaz project). As a result, this study recommends policies and strategies to overcome the existing barriers, such as: a) Adequate funding from the Federal Government and/or international agencies. b) Adequate financial programs from existing local banks and/or international banks with low interest rates so as to be affordable for poor municipalities. c) Adequate policies increasing the existing CCC to biomass power production in Brazil, and the introduction of similar programs in Colombia. d) To develop one local pilot demonstration plant in one of the selected municipalities. 1 www.grupotgm.com.br/home/ iii e) To improve existing electric sector legislation and existing programs to increase energy access, aiming to incentivize the utilities to provide this supply. In short, energy access, including energy for productive uses, may contribute to increasing the (very) low HDI of the selected municipalities of the project in the following cases: a) Productive uses may allow local people to market more products with more value added (see the example of the Gaseifamaz project in Amazon region). b) If MSW, which is inadequately disposed in all municipalities, can be used for energy production, this could help to make the adequate collection and disposal of waste feasible. c) In the case of agricultural and wood residues, which are mainly burnt in open-air, the energy conversion would eliminate the CO2 emissions from this burning and their health impacts. iv Table of Contents Executive Summary................................................................................................................... i List of Figures .............................................................................................................................x List of Tables ........................................................................................................................... xiii List of Equations ..................................................................................................................... xx 1. Introduction ...................................................................................................................... 21 I. Brazil............................................................................................................................................................ 22 II. Colombia ................................................................................................................................................. 26 1.1. Objective .................................................................................................................................. 29 1.2. Methodological approach ................................................................................................ 30 1.3. Working Group ..................................................................................................................... 33 I. Coordination: .......................................................................................................................................... 33 II. Senior Researchers: ............................................................................................................................. 33 III. Associate Researchers: ..................................................................................................................... 34 IV. Supporting