Abstract
AbstractThe aviation industry accounts for more than 2% of global CO2 emissions. Biojet fuel is expected to make an essential contribution to the decarbonization of the aviation sector. Brazil is seen as a key player in developing sustainable aviation biofuels owing to its long‐standing experience with biofuels. Nevertheless, a clear understanding of what policies may be conducive to the emergence of a biojet fuel supply chain is lacking. We extended a spatially explicit agent‐based model to explore the emergence of a biojet fuel supply chain from the existing sugarcane–ethanol supply chain. The model accounts for new policies (feed‐in tariff and capital investment subsidy) and new considerations into the decision making about production and investment in processing capacity. We found that in a tax‐free gasoline regime, a feed‐in tariff above 3 R$/L stimulates the production of biojet fuel. At higher levels of gasoline taxation (i.e., 2.46 R$/L), however, any feed‐in tariff is insufficient to ensure the production of biojet fuel. Thus, at these levels of gasoline taxation, it is needed to introduce regulations on the production of biojet fuel to ensure its production. Given the current debate about the future direction of the biofuel policy in Brazil, we recommend further research into the effect of market mechanisms based on greenhouse gas emissions on the emergence of a Brazilian biojet fuel supply chain.
Highlights
The aviation industry accounts for more than 2% of global CO2 emissions (Cremonez et al, 2015)
The values in bold were obtained from the model calibration (Moncada et al, 2018). aThe distribution of the production capacity was based on Valdes (2011). bIt is assumed that the differences in the yields are due to differences in industrial efficiencies between mills and distilleries. cRetrieved from Santos, Mussatto, Osseweijer, van derWielen & Posada (2018)
The results suggest that the emergence of a Brazilian biojet fuel supply chain, from the existing sugarcane–ethanol supply chain, is largely driven by a tax‐free gasoline regime and a feed‐in tariff greater than 3 R$/L, provided that the policy landscape for both road transport and aviation sector remains stable, that the demand for jet fuel is perfectly inelastic, that there is no differentiation between the type of technologies, resources, and location in the granting of feed‐in tariffs, and that the effect of import and export tariffs on the market is negligible
Summary
The aviation industry accounts for more than 2% of global CO2 emissions (Cremonez et al, 2015). To reduce the environmental impact of the aviation sector, the Air Transport Action Group (ATAG) has established goals to reach carbon neutral growth from 2020 and reduce net carbon dioxide emissions by 50% (relative to 2005 levels) by 2050 (Group A.T.A., 2012). Aviation will rely on liquid fuels with high energy density for decades to come (Group A.T.A., 2012). Biojet fuel is expected to make an essential contribution to the decarbonization of the aviation sector (Mawhood et al, 2016). Production volumes of biojet fuel have been negligible as demand remains low because of high prices (de Jong et al, 2015). The lack of competitiveness of biojet fuel as compared to jet kerosene is one of the
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