Industrial giants to reopen 15 closed sugar mills in Bihar; ethanol boom triggers rural revival
The sugar cane industry in India's Bihar state employs a large number of small farmers. Over the past decade, however, the sector has undergone a serious decline with falling world sugar prices, resulting in a social drama. The stagnation of the sugar cane industry saw more than a dozen mills being closed. But now, with record oil prices and the competitiveness of sugar cane derived ethanol, the sector is in for a major revival.
The Bihar State Sugar Corporation, under auspices of the state government, offers 15 closed mills under a long term lease of 60 years, extendable to 30 years. Some of India’s leading oil and industrial companies - Reliance Industries, Tata Chemicals, Fieldfresh of Bharati Enterprises and India Oil - have all expressed their interest in reopening them to produce ethanol.
Other companies that have purchased RFQ forms to make bids are Bharat Petroleum, Hindustan Petroleum, Renuka Sugars, Upper Ganges Sugar, Dhampur Sugar and India Glycols. Officials in the government-owned IOC, the country's largest refiner, also confirmed that it intends to make ethanol and will enter the bidding.
Closed for more than a decade, the mills together have a financial liability of 7 billion rupees (€121.3/US$177.4) under various heads and the funds raised by leasing them will be used to clear the liabilities.
The floor price of these mills, mostly based in northern Bihar, has been fixed at between 80 million (€1.38/US$2 million) and 700 million rupees (€12.1/US$17.7 million). The state is offering a capital subsidy of 10 percent of the investment, subject to a 100 million rupee ceiling.
Earlier this year, India's central government had made 5 per cent blending of ethanol in petrol mandatory and it would increase it to 10 percent by October 2008. This is an ambitious target, but it goes a long way in relieving sugar producers from the oversupply problems they have been facing.
In India, ethanol is made from molasses, a byproduct of sugar cane processing. The efficiency and cost-effectiveness of sugar cane ethanol is largely due to the high sugar yield of the plant and because these sugars can be readily fermented. Ethanol made from starches must first be broken down into simple sugars, whereas the utilization of lignocellulosic biomass requires even more complex thermochemical or biochemical processing steps.
Bihar currently has 252,000 hectares dedicated sugarcane cultivation and produces around 14.4 million tonnes of sugarcane every year. Compared to other states, Bihar is a relatively small player, with a 3% market share (map, click to enlarge). But the land area devoted to sugarcane accounts for only 4.5 per cent of the state’s cultivable area of more than 5.5 million hectares. This means there is vast scope to increase the sugarcane acreage:
energy :: sustainability :: biomass :: bioenergy :: biofuels :: ethanol :: bagasse :: molasses :: sugarcane :: rural development :: Bihar :: India ::
Earlier this year, the Bihar state government amended the Bihar Sugarcane Regulation of Supply and Purchase Act of 1981, allowing sugarcane juice to be directly used to produce ethanol or rectified spirit. The new law also allows the use of bagasse, an abundant sugarcane byproduct, for co-generation of power. Integrated sugar and ethanol plants that utilize bagasse, can produce biofuels with a very strong energy balance.
Out of the 15 closed sugar mills on offer, eight have been reserved for sugarcane based industries like sugar mills, distilleries for ethanol and alcohol production while seven are allowed to be converted into non-sugarcane facilities.
According to state’s Sugarcane development minister, Nitish Mishra, a pre-bid meeting is to be held on December 8 in New Delhi. All bids need to be submitted by the December 20. The leasers will be shortlisted on December 29.
Sugarcane based ethanol has had no impact on world sugar prices so far. This is due to the fact that both Brazil and India made record harvests this year. Next year's harvest is set to break the record again. India has the world's second largest sugar industry, producing some 14 million tonnes of refined sugar per year from cane grown on 3.6 million hectares of land.
Mired by oversupplies, the sugar sector in India this year urged the government to urgently adopt mandatory ethanol targets, in order to push up the price of the commodity. The government responded with the ambitious 10% target for 2008, which will require the production 825,000 tonnes of ethanol (roughly 1 billion liters / 227 million gallons).
References:
Bihar Times: Corporate giants interested in sugar mills of Bihar - December 6, 2007.
Business Standard: Reliance, Tata, Bharti eye Bihar sugar mills - December 6, 2007.
CommodityOnline: Oil giants eyeing Bihar sugar mills for ethanol - December 6, 2007.
Article continues
The Bihar State Sugar Corporation, under auspices of the state government, offers 15 closed mills under a long term lease of 60 years, extendable to 30 years. Some of India’s leading oil and industrial companies - Reliance Industries, Tata Chemicals, Fieldfresh of Bharati Enterprises and India Oil - have all expressed their interest in reopening them to produce ethanol.
Other companies that have purchased RFQ forms to make bids are Bharat Petroleum, Hindustan Petroleum, Renuka Sugars, Upper Ganges Sugar, Dhampur Sugar and India Glycols. Officials in the government-owned IOC, the country's largest refiner, also confirmed that it intends to make ethanol and will enter the bidding.
Closed for more than a decade, the mills together have a financial liability of 7 billion rupees (€121.3/US$177.4) under various heads and the funds raised by leasing them will be used to clear the liabilities.
The floor price of these mills, mostly based in northern Bihar, has been fixed at between 80 million (€1.38/US$2 million) and 700 million rupees (€12.1/US$17.7 million). The state is offering a capital subsidy of 10 percent of the investment, subject to a 100 million rupee ceiling.
Earlier this year, India's central government had made 5 per cent blending of ethanol in petrol mandatory and it would increase it to 10 percent by October 2008. This is an ambitious target, but it goes a long way in relieving sugar producers from the oversupply problems they have been facing.
In India, ethanol is made from molasses, a byproduct of sugar cane processing. The efficiency and cost-effectiveness of sugar cane ethanol is largely due to the high sugar yield of the plant and because these sugars can be readily fermented. Ethanol made from starches must first be broken down into simple sugars, whereas the utilization of lignocellulosic biomass requires even more complex thermochemical or biochemical processing steps.
Bihar currently has 252,000 hectares dedicated sugarcane cultivation and produces around 14.4 million tonnes of sugarcane every year. Compared to other states, Bihar is a relatively small player, with a 3% market share (map, click to enlarge). But the land area devoted to sugarcane accounts for only 4.5 per cent of the state’s cultivable area of more than 5.5 million hectares. This means there is vast scope to increase the sugarcane acreage:
energy :: sustainability :: biomass :: bioenergy :: biofuels :: ethanol :: bagasse :: molasses :: sugarcane :: rural development :: Bihar :: India ::
Earlier this year, the Bihar state government amended the Bihar Sugarcane Regulation of Supply and Purchase Act of 1981, allowing sugarcane juice to be directly used to produce ethanol or rectified spirit. The new law also allows the use of bagasse, an abundant sugarcane byproduct, for co-generation of power. Integrated sugar and ethanol plants that utilize bagasse, can produce biofuels with a very strong energy balance.
Out of the 15 closed sugar mills on offer, eight have been reserved for sugarcane based industries like sugar mills, distilleries for ethanol and alcohol production while seven are allowed to be converted into non-sugarcane facilities.
According to state’s Sugarcane development minister, Nitish Mishra, a pre-bid meeting is to be held on December 8 in New Delhi. All bids need to be submitted by the December 20. The leasers will be shortlisted on December 29.
Sugarcane based ethanol has had no impact on world sugar prices so far. This is due to the fact that both Brazil and India made record harvests this year. Next year's harvest is set to break the record again. India has the world's second largest sugar industry, producing some 14 million tonnes of refined sugar per year from cane grown on 3.6 million hectares of land.
Mired by oversupplies, the sugar sector in India this year urged the government to urgently adopt mandatory ethanol targets, in order to push up the price of the commodity. The government responded with the ambitious 10% target for 2008, which will require the production 825,000 tonnes of ethanol (roughly 1 billion liters / 227 million gallons).
References:
Bihar Times: Corporate giants interested in sugar mills of Bihar - December 6, 2007.
Business Standard: Reliance, Tata, Bharti eye Bihar sugar mills - December 6, 2007.
CommodityOnline: Oil giants eyeing Bihar sugar mills for ethanol - December 6, 2007.
Article continues
Thursday, December 06, 2007
Scientists discover methane-eating bacterium that could help fight climate change
It is the hardiest 'methanotrophic' bacterium yet discovered, which makes it a likely candidate for use in reducing methane gas emissions from landfills, mines, industrial wastes, geothermal power plants, and peatlands. The discovery once again suggests that investigating life in extreme environments - the search for useful 'extremophiles' - can contribute to solving some of the world's biggest problems. The bugs are finding applications in a wide range of fields, from the production of innovative pharmaceuticals to the efficient conversion of biomass into abundant biofuels (previous post).
The exotic bacterium discovered in Hell's Gate is a really tough methane-consuming organism that lives in a much more acidic environment than any of the scientists have ever seen before. It belongs to a rather mysterious family of bacteria called Verrucomicrobia that are found everywhere but are very difficult to grow in the laboratory.
Methanotrophic bacteria consume methane as their only source of energy and convert it to carbon dioxide during their digestive process. Methane (commonly known as natural gas) is 20 times more potent a greenhouse gas than carbon dioxide and is largely produced by decaying organic matter. Scientists have long known that vast amounts of methane are produced in acidic environments, not only geothermal sites but also marshes and peat bogs. Much of it is consumed by methanotrophic bacteria, which serve an important role in regulating the methane content of the world's atmosphere.
Scientists are interested in understanding what conditions cause these bacteria to be more or less active in the environment. Unfortunately, few species have been closely studied. We now know that there are many more out there.
Professor Dunfield has tentatively named the new bacterium Methylokorus infernorum to reflect the 'hellish' location of its discovery where it lives in boiling waters filled with chemicals that are toxic to most life forms:
energy :: sustainability :: biomass :: bioenergy :: biofuels :: methane :: greenhouse gases :: climate change :: extremophile :: bacteria ::
The Maori caretakers of the site, the Tikitere trust, have supported scientific study of the area. The study was conducted while Dunfield was working for GNS Science, a geological research institute owned by the New Zealand government. He recently joined the University of Calgary's Department of Biological Sciences as a professor of environmental microbiology.
The bacterium's genome has been completely sequenced by researchers at the University of Hawaii and Nankai University in China, which could help develop biotechnological applications for this organism.
Dunfield said he plans to pursue his work in Canada by hunting for new life forms in extreme environments such as northern peatlands, the oilsands of northern Alberta and the hot springs of Western Canada.
Dunfield's Nature article was published online on November 14, 2007 and in the December 6 edition of the journal.
References:
Peter F. Dunfield, et al., "Methane oxidation by an extremely acidophilic bacterium of the phylum Verrucomicrobia", Nature 450, 879-882 (6 December 2007), doi:10.1038/nature06411
Biopact: Investigating life in extreme environments may yield applications in the bioeconomy - July 05, 2007
Article continues
posted by Biopact team at 9:05 PM 0 comments links to this post