Power generation from sugarcane biomass e A complementary option to

hydroelectricity in Nepal and Brazil
Dilip Khatiwada
a, b,
*
, Joaquim Seabra
b, c,1
, Semida Silveira
a, 2
, Arnaldo Walter
b, c, 3
a
Division of Energy and Climate Studies, KTH - Royal Institute of Technology, Brinellvägen 68, 100 44 Stockholm, Sweden
b
Brazilian Bioethanol Science and Technology Laboratory (CTBE), Campinas, SP, Brazil
c
Faculdade de Engenharia Mecânica, UNICAMP, Rua Mendeleyev 200, 13083-860 Campinas, SP, Brazil
a r t i c l e i n f o
Article history:
Received 24 October 2011
Received in revised form
1 March 2012
Accepted 6 March 2012
Available online 7 April 2012
Keywords:
Sugarcane biomass
Bioelectricity
Hydroelectricity
Complementarity
a b s t r a c t
This paper discusses the complementarity between hydroelectricity and surplus electricity from sugar-
cane biomass-based cogeneration plants in sugarcane mills. The paper investigates opportunities and
barriers in the context of governments’ initiatives, institutions and prevailing regulatory frameworks in
Brazil and Nepal. The paper finds that bioelectricity from cogeneration can be a good complementary
option for hydroelectric power, helping foster diversification on the generation side and enhance security
of electricity supply based on local resources. Bioelectricity potential from sugarcane biomass is esti-
mated to be in the range of 209e313 GWh for Nepal and 62e93 TWh for Brazil. In Nepal, the grid
connected bioelectricity can provide power for operating industries, and support local development
through rural electrification. In Brazil, the biomass potential can be further enhanced through a better
utilization of the biomass in the sugar-ethanol industry to balance hydropower availability. This
comparative study offers a reflection on the need for better planning and policies to address the barriers
which are hindering the development of bioelectricity even in places where the potential is large.
Ó 2012 Elsevier Ltd. All rights reserved.
1. Introduction
Access to reliable and modern energy sources is essential for
improving living standards and promoting economic development.
Poor countries in Africa and Asia are highly dependent on tradi-
tional energy sources, while fast growing developing countries
have significantly made the transition from traditional to modern
energy. For example, electricity consumption per capita in Nepal,
a least developed country in Asia, is only 90 kWh compared to
2232 kWh/capita in Brazil, a rapidly growing developing country in
South America [1]. Total primary energy supply is dominated by
traditional biomass in Nepal, with a total share of 87% [2]. Biomass
is also important in Brazil but the fraction of traditional biomass
(i.e. firewood) in the Brazilian energy matrix was only 10.2% while
modern biomass (i.e. sugarcane energy products) accounted for
18.8% in 2009 [3].
Brazil and Nepal count with significant hydro as well as bio-
energy potential. In fact, the two countries have the highest per
capita hydro resource potential for hydroelectric production in the
world. The two countries are also sugarcane producers. Brazil is the
largest producer of sugarcane in the world and the second largest
producer of ethanol. Nepal is a sugar producer and has already
installed a plant to start ethanol production [4]. This means the two
countries can produce not only sugar and ethanol from sugarcane
but also heat and power from bagasse cogeneration plants. Bagasse
cogeneration conventionally provides heat and power to sugar
mills/ethanol conversion units. However, there is also a huge
potential for generation of surplus electricity which is not being
explored in Nepal and is only partially used in Brazil. In fact, only
5.4% of Brazil’s electricity is biomass-based. An important detail is
that sugar and ethanol plants operate mainly during the dry season
(MayeNovember in Brazil; DecembereMay in Nepal) and, if
producing electricity, can provide a good complement to hydro-
power particularly during the harvesting and crushing season of
sugarcane.
This paper examines the way Brazil and Nepal are developing
these two renewable resources for meeting national electricity
needs, evaluates the size of the existing potential and the different
* Corresponding author. Division of Energy and Climate Studies, KTH -
Royal Institute of Technology, Brinellvägen 68, 100 44 Stockholm, Sweden.
Tel.: þ46 8 790 7431, þ46 72 366 53 88 (Cell).
E-mail addresses: dilip.khatiwada@energy.kth.se (D. Khatiwada), jseabra@
fem.unicamp.br (J. Seabra), semida.silveira@energy.kth.se (S. Silveira), awalter@
fem.unicamp.br (A. Walter).
1
Tel.: þ55 19 3521 3284.
2
Tel.: þ46 8 790 7469, þ46 70 665 9969 (Cell).
3
Fax: þ55 19 3289 3722.
Contents lists available at SciVerse ScienceDirect
Energy
j ournal homepage: www. el sevi er. com/ l ocat e/ energy
0360-5442/$ e see front matter Ó 2012 Elsevier Ltd. All rights reserved.
doi:10.1016/j.energy.2012.03.015
Energy 48 (2012) 241e254
barriers that need to be addressed as this potential is harnessed.
Brazil is a strong emerging economy while Nepal is still in the early
stages of economic development. The contrasting experiences of
the two countries provide insights and interesting lessons to
many developing countries with bioelectricity potential. Following
this introduction, the second and third sections deal with the
energy matrix and trends of production and consumption of elec-
tricity in Nepal and Brazil. Also the efforts and obstacles for
development of the electricity sector are discussed. The fourth
section assesses sugarcane bioenergy systems and bagasse cogen-
eration along with conversion technologies for bioenergy genera-
tion and bioelectricity potential. The fifth section discusses the
complementarity of bioelectricity with hydropower in the two
countries. The final section reflects on the need to review planning
practices to address barriers to the development of bioelectricity.
2. Energy systems in Nepal
2.1. Primary energy matrix
Nepal is one of the least developed countries (GDP: US$ 438 per
capita) in the world with more than 80% of the total population
living in rural areas. The total primary energy consumption in Nepal
is 9.6 Mtoe (million tonne oil equivalent) or 0.34 toe per capita [2],
one of the lowest in the world [1]. The country relies heavily on
traditional biomass resources (viz. firewood, animal dung and
agricultural residues) which contributes 87% of the total primary
energy consumption. The total energy consumption grew 21%
between 1999 and 2009 [2]. Commercial energy amounts to 12% of
the total in the form of fossil fuels (i.e. petroleum and coal) and grid
connected electricity. Contribution of electricity in the primary
energy share is only 1.8%. Modern renewables (micro hydro, biogas,
solar) account for less than 1% (0.68%) as shown in Fig. 1. Although
the use of modern renewables has increased by about three-fold in
this period, this has a negligible share in the total primary energy
consumption [2].
The residential sector consumes 89% of the primary energy,
mainly in the formof cooking fuel, followed by transport (5.2%) and
industrial uses (3.3%). These numbers denote the low level of
industrial and economic activities in the country. Moreover, Nepal
does not have fossil fuel reserves. Therefore, petroleumand coal are
being imported spending a major share of export earnings.
2.2. Electricity and hydropower development in Nepal
Nepal is endowed with plenty of water resources with hundreds
of perennial rivers flowing from the north to the south in steep
gradients, making them suitable for hydroelectricity generation.
The total hydroelectric potential is estimated at 83,000 MW, out of
which approximately 42,000 MW could be economically feasible
[2], positioning Nepal as one of the countries with the highest
hydroelectricity potential per capita in the world. The historic trend
of the installed capacity of hydroelectricity during the last ten
planning periods is shown in Fig. 2 [5]. Hydropower development
has progressed in a very slow pace in Nepal if compared to other
developing countries in the world, the country’s potential and
electrification needs. Nepal added 507.4 MW hydropower capacity
to its matrix (public investment) since the 1950s against a target of
3784.7 MW (i.e. 13.4% of the target). As a result, the country is
presently facing a huge crisis of electricity supply.
At present, the total installed capacity of electricity (including
isolated/grid connected and hydro/thermal) is 708 MW in Nepal.
Table 1 shows details about the sources of installed electricity
generation. Nepal Electricity Authority (NEA), the state owned
public company, is largely responsible for construction, generation,
transmission and distribution of electricity, including purchase and
pricing of electricity. As per the state’s strategy and electricity
sector reform for attracting private sector to invest in hydropower
development, Independent Power Producers (IPPs) appeared in the
1990s. IPP’s operations are managed by the Nepal Electricity Act
(1992) and Power Purchase Agreement (PPA) with NEA. The Inte-
grated Nepal power system (INPS) comprises 685 MW installed
electricity generation capacity, of which 77% are under NEA (both
hydro and diesel-thermal i.e. 526.4 MW) and 23% or 158.3 MWare
operated by IPPs (NEA, 2010). Isolated energy systems (i.e. micro-
hydro and solar home systems) serve remote rural areas [6], and
constitute 2.7% (i.e.19 MW) of the total installed capacity (see
Table 1). The average total cost (i.e. total investment) of generation
of electricity is about US$ 2500/kWin Nepal while the construction
period of medium and large hydropower plants vary from 4 to 6
years [7].
Fig. 1. Total energy consumption in 2009 by various fuel types in Nepal [2]. Fig. 2. Historic development of grid connected hydropower capacity in Nepal [5].
D. Khatiwada et al. / Energy 48 (2012) 241e254 242
Most of the hydropower plants in Nepal are of the run-of-the-
river type. This means that the water flow varies significantly
between the wet and dry seasons. Demand for electricity is
dramatically increasing at an average annual growth rate of 10%.
Peak demand has more than doubled from 351 MW in 2001 to
885 MWin 2009, a 131% increase in one decade [8]. But, generation
of hydroelectricity has not been sufficient to meet this increasing
demand and there has been a massive load-shedding (black-out
situation) since 2006. According to NEA’s annual report (2009/10),
peak demand in the grid was 885 MW in 2009/10 which is a 9%
increase compared to the previous year [8]. Out of the total annual
energy demand of 4367 GWh, Nepal domestically produced
3077 GWh while 613 GWh was imported, and the remaining
678 GWh was managed by load-shedding. At the same time, the
average capacity factor of the grid connected power plants was only
51% as hydropower plants do not run under their full generation
capacity in the dry season. Shares of available energy fromdifferent
sources including purchased fromprivate parties of Nepal and India
are depicted in Fig. 3. Energy from diesel-thermal plants had
a small share or only 0.3% in 2009 compared to 7.8% in 1998.
Thermal plants run occasionally due to high operation and main-
tenance costs.
Actual electricity system losses (technical and non-technical)
amounted to 28.6% in 2008/2009. Self utilization (0.98%) and
export to India (1.48%) contributed small shares. The residential
sector responded for the largest share of electricity demand (41.2%),
followed by the industrial sector (37.7%), see Fig. 4. However, the
sales of electricity remained almost constant in the past three
consecutive years in spite of increased demand. This is primarily
due to electricity shortage and rationing of electricity from the
national grid.
Nepal is presently facing minimum 2 h (wet season) to 14 h (dry
season) of loading shedding [9], resulting in negative implications
for industrial development in the country. Long dry seasons
coupled with run-of-the-river type hydropower plants and uneven
energy demand during the day (i.e. peak load occurs between
5:00e9:00 pm [8]) are the key reasons for extended hours of load-
shedding in Nepal. The demand for electricity is growing faster
with the increase of population and economic activities, but the
development of supply is not coping. NEA has forecasted the future
electricity demand and peak load as shown in Fig. 5. To match the
increasing electricity demand, welfare improvements and security
of supply, the installation of new plants and the diversification of
the system are urgently needed. Choosing domestically available
sustainable resources could bring large benefits to the national
economy [4]. Bioenergy is an attractive option in this context.
2.3. Efforts and obstacles for development of electricity in Nepal
Inspite of a long history inhydropower development, only 39%of
the population have access to electricity in Nepal [6]. Large hydro-
power plants have a long gestation period including comprehensive
planning, huge investments and large impact on the national
budget. The total cost of Kali Gandaki "A", which is the largest
hydropower plant in Nepal with the installed capacity of 144 MW,
was US$ 354.8 million [10] (i.e. Rs 26 billion; exchange rate: US$
1 ¼ Rs 72) and the project construction period was about 6 years.
This is to mention here that the total allocated government expen-
diture (i.e. recurrent and capital) in the electricity sector was only Rs
12.6 billion, a small share of 4.85% of the total national budget/
expenditure (i.e. Rs 259.7 billion) in the fiscal year 2009/10 [11]. This
shows that the government could not afford to invest in the large
hydropower plants without mobilizing extra financial resources. At
the same time, electricity generation from imported diesel in
thermal plants incurs very high costs, more thanthree times the cost
of electricity from hydropower, considering 3.3 kWh electricity
generation per litre of diesel (the price of diesel is 68.5 Rs/liter in
Nepal). Oil imports amounted to more than Rs 70 billion in the fiscal
year 2010/11, with annual spending equivalent to 21% of the total
national budget [12]. Diesel power plants are not feasible for
continuous operation both for economic and environmental
reasons. Another problem is the difficulty to extend the national
electricity grid in remote areas. System losses in Nepal are also high
[8]. Thus, in face of the country’s mountainous topography,
increasing oil prices (including operation and maintenance costs
involved in diesel power plants), high infrastructure costs associated
with hydroelectricity generation and distribution, and increasing
environmental demands, it is important to explore sustainable and
affordable energy options to guarantee the development of Nepal.
The Government of Nepal (GoN) has promoted Renewable
Energy Technologies (RETs) such as micro-hydro, solar, and biogas.
Still, the contribution is very minimal when it comes to the total
shares of primary energy consumption. Independent Power
Producers (IPPs) have contributed with about 23% of the grid
connected electricity. The government of Nepal (GoN) and donor
agencies have also developed schemes to promote off-grid tech-
nologies (i.e. micro-hydro and solar home systems) for rural elec-
trification [6]. In fact, this has led to the formation of rural markets
for micro-hydro and solar home systems in the country.
NEA cannot afford major investments since the company has
been suffering from huge financial losses. NEA has faced a net loss
Table 1
Total installed capacity for electricity generation by source (Isolated and grid) in
Nepal.
Particulars MW % share
NEA (hydro) 473.0 66.8
NEA (small hydro-isolated) 4.5 0.6
NEA (thermal) 53.4 7.5
IPP 158.3 22.3
Micro hydro (Isolated) 13.9 2.0
Solar home system 5.2 0.7
Total 708.3 100.0
NEA: Nepal Electricity Authority; IPP: Independent Power Producer.
Sources: Water and Energy Commission Secretariat (WECS) [2] and NEA [8].
Fig. 3. Percentage (%) share of available energy in 2009 in the national grid in
Nepal [8].
D. Khatiwada et al. / Energy 48 (2012) 241e254 243
of Rs 2.40 (3.3 US ¢) per kWh, amounting to a whopping total loss of
US$ 74.32 million in the year 2009/10 [8]. Due to the lack of proper
pricing mechanismand political interferences, NEA could not apply
a system of full cost recovery on sales tariffs. In fact, while NEA’s
average cost of service per kWh is Rs 8.97 (12.5 US ¢), the sales tariff
rate is only Rs 6.57 (9.1 US ¢) per kWh, leading to accumulated
financial losses which are then born by the government of Nepal.
In an effort to reduce rationing of electricity and the ever
increasing demand-supply gap, the government of Nepal (GoN) has
declared state of ‘energy emergency’ in 2008 and 2011. This was
followed by ambitious action plans including installation targets. A
high level committee was formed in 2008 which has already
submitted a report to the GoN, but implementation of activities has
not been initiated, basically due to financial bottlenecks. This year’s
energy emergency plan aims to develop hydropower plants, setting
a new target of 2500 MW for the next five years, and encouraging
private sector participation in electricity generation. Nepal is
currently undergoing a political transition which is detrimental to
the development of the electricity sector, and more specifically
hydropower. Lack of consensus around the direction to take
involves conflicts of interest, shared hydropower issues with India
and financial constraints. Therefore, it is important to seek alter-
natives and complimentary options to tackle the energy crisis both
technically and economically. These options shall contribute to the
provision of affordable electricity and contemplate other important
domestic resources such as biomass.
3. Energy systems in Brazil
3.1. Primary energy matrix
Brazil is one of the fastest-growing developing countries in
terms of economic growth and industrialization. Brazil is also the
eighth largest economy in the world with GDP per capita of
Fig. 5. Load forecast in Nepal [8].
Fig. 4. Historic trend of utilization of electricity in Nepal [8].
D. Khatiwada et al. / Energy 48 (2012) 241e254 244
approximately US$ 8204 (in 2009), making it a middle-income
developing country. Brazil is highly urbanized with more than
80% of the population living in urban areas.
The total primary energy consumption in Brazil was 241 Mtoe in
2009 [3]. In the Brazilian primary energy matrix, renewable energy
sources have a significant share, that is 46.9% compared to only 6.1%
in OECD countries and 13.2% in the world as a whole. Sugarcane-
related products contributed 18.8%, followed by hydropower
(13.9%), and firewood (10.2%). Fig. 6 shows the shares of the Bra-
zilian energy mix. It should be pointed out that Brazil is an oil
producing country.
The share of traditional firewood (i.e.10.2%) has decreased
significantly in past decades as a result of modernization in the
Brazilian economy. The share of firewood in the Brazilian energy
matrix was 45% in 1970. Today, 90% of the Brazilian energy matrix
comprises commercial energy. In contrast, Nepal only utilizes 12%
of commercial energy and the rest comes from traditional biomass.
A similar situation is found in other least developed countries. The
large use of energy in the industrial sector, together with the
commercial character of the energy sector, provide evidence for
the high level of industrialization already reached in Brazil.
3.2. Electricity and power sector development in Brazil
The development of hydropower gained new momentum in
Brazil after the oil price shocks of the 1970s and in line with
increased industrialization. Fig. 7 shows the historic trend of power
plants installed capacity in the country between 1974 and 2009.
Total installed capacity in Brazil reached 106 GWin 2009, including
independent producers. Out of the total installed capacity hydro-
power accounted for 74.7%, followed by thermal, nuclear and wind
which contributed 22.9%, 1.9% and 0.6%, respectively. Thermal
electricity generation comes from both fossil and renewable fuels.
Electricity generation comes from both public service power
plants and self-producers, and amounted to 466.2 TWh in 2009.
The public service plants that provide electricity to the grid
contributed with 87.8% of the total domestically generated elec-
tricity (i.e. 409 TWh) while the rest was produced by autonomous
or independent producers. Electricity from sugarcane biomass
comprises about 3% of the total domestic generation and is mostly
used for providing power to the sugar-ethanol mills. With net
imports of 40 TWh and domestic generation, the total electricity
supply was 506 TWh. Fig. 8 shows the domestic electricity supply
from different sources. Total electricity from hydro was 85% since
all imports of electricity come from hydropower. Electricity
consumption is growing at a rate of 4e5% annually.
As for the consumption pattern, total consumption amounted to
426 TWh, of which the industrial sector consumed 43.7%, followed
by the residential (23.9%) and commercial (15.1%) sectors, and
others (see Fig. 9). Total losses in the Brazilian system (i.e. trans-
mission and distribution) amounted to 15.8% (i.e. 80 TWh)
compared to 28.6% in Nepal. Note that Nepal has poor quality of
electricity supply with very high level of technical and non-
technical (i.e. theft or unauthorized use of electricity) losses [13,14].
Brazil has abundant potential of hydroelectricity and the
potential is estimated at 261 GW [15]. The present installed
capacity only represents 30% of the total hydroelectric potential in
the country. The electricity system comprises grid connected and
isolated systems. The grid connected electricity represents about
96% of the total capacity (mostly hydroelectricity), and the rest
corresponds to the isolated systems which are mostly fossil based
thermoelectric power plants.
It should be noted that the total share of hydropower (installed
capacity) is remarkably decreasing since 1998, while the share of
thermal power is increasing, see Figs. 10 and 11. This is partly the
result of increased criticism and environmental control of large
dams in the 1990s, but also of increased use of thermal power
plants to diversify and secure supply, particularly after an electricity
shortage experienced in 2001 (see below).
3.3. Reform of the electricity sector in Brazil
Until the mid-80s, the government had full control of the elec-
tricity sector, a common model in the energy sector of all countries
at that time. The 1980s were also characterized by a major financial
crisis in Brazil which set the scene for an increasingly open
economy. Brazil’s electricity reform began in 1990 with a gradual
introduction of a more competitive environment and increased
private participation in the power sector [16]. In general terms,
reform and restructuring refer to privatization and deregulation
with the separation of the generation, transmission and distribu-
tion activities in the electricity sector. Abolishment of the public
monopoly in infrastructure development has enabled private and
foreign firms to enter the energy segment in Brazil. Unbundling
aimed at opening for free competition and free access to the grid,
and promotion of increased participation from the private sector.
In spite of reform and restructuring initiatives in the electricity
sector, a huge energy crisis (supply crisis) occurred in 2001, leading
to 20% electricity rationing, and widespread blackouts. Scarcity of
rain (drought) and lack of investments in generation and trans-
mission were considered to be the main causes of the crisis [16].
After that, the government of Brazil formulated and implemented
a newmodel for the electricity sector. As per this reform, electricity
procurement for expansion of the power sector is made through
public auction, aimed at contracts for energy delivery. This was
expected to reduce price volatility and promote new investments.
Two trading schemes - Regulated Contracting Environment (ACR)
and Free Contracting Environment (ACL) came into place in 2003.
The ACR is aimed to meet demand from captive consumers with
lower levels of consumption, while ACL targets free consumers
with larger volumes. In the ACR regime, power supply contracts are
signed determining the amount of electricity necessary to guar-
antee power availability [16]. Also, the supply prices are set
through the auctions. In the ACL, bilateral contracts are managed
freely as prices, volumes and timeframes are concerned, and the
government has minimal intervention in the prices freely
negotiated.
It should be noted that the contracts through auctioning
process differ from a conventional single buyer scheme where Fig. 6. Shares of primary energy production in Brazil in 2009 [3].
D. Khatiwada et al. / Energy 48 (2012) 241e254 245
a government electricity agency signs a power purchase agreement
(PPA) with an energy producer through negotiation. The contracts
between energy generation and distribution companies are inde-
pendent, and the government’s role is minimal. In the case of
hydroelectricity, new hydropower plants are offered to entrepre-
neurs who quote the electricity production during thirty years at
the lowest price. Before the auctioning process, a minimum cap
price will be evaluated for each hydropower plants, taking account
of the energy/water flows in the specific site and risks associated
with hydrological cycles. In the power generation from thermal
plants and renewable energy sources (e.g. cogeneration, wind, and
small hydro), the procedure is different. Two economic parameters,
viz., operation cost and required annual revenue are evaluated
before projects are offered to potential investors [17].
Recognizing the need for diversification of the electricity sector,
the Brazilian government has encouraged other renewable energy
sources in the electricity mix through a programcalled PROINFA (in
2002). PROINFA aimed to increase the participation of autonomous
independent power producers in electricity generation connected
to the grid using three renewable sources, viz., wind, small hydro
and biomass [18e20]. In the first phase, producers of these
renewable sources were encouraged to sign 15-year long term
contracts, achieving each 1100 MW of installed capacity. The
second phase was planned to have a target share of 10% for alter-
native energy sources in the Brazilian electricity consumption
matrix by 2026 [18]. However, Brazil’s power sector reform has
deviated the PROINFA’s second phase, which occurred in 2003 by
introducing two different contracting regimes in order to control
the excessive rise of the electricity tariff [18]. The government has
not prioritized the second phase as electricity generation from all
renewables also came under the technology-specific auctioning
regime of the power sector reform.
As previously mentioned, the Brazilian electricity sector is still
dominated by clean energy mix. However, increasing electricity
demand, constraints on hydropower and the strong penetration of
thermal power plants fuelled mainly by fossil sources (e.g. oil, coal
Fig. 7. Installed capacity of power plants in Brazil (1974e2009) [3].
Fig. 8. Brazilian electricity supply by source in 2009 [3]. Fig. 9. Consumption of electricity by sector, Brazil 2009 [3].
D. Khatiwada et al. / Energy 48 (2012) 241e254 246
and natural gas) is threatening to move the Brazilian power system
towards less renewables [17]. This path contrasts with the efforts of
other industrialized countries to move towards low-carbon tech-
nologies. The electricity sector in Brazil has gone through various
reforms and institutional changes, and also faced a huge energy
crisis. This has made the sector quite strong. Still revisions on policy
frameworks are required to push the renewables into the main-
stream of electrical energy options for the future. In this paper, we
look more closely on the role of bioelectricity from sugarcane
biomass as a supplementary option to the hydropower.
4. Sugarcane bioenergy and surplus electricity from
cogeneration
4.1. Sugarcane bioenergy systems and bagasse cogeneration
Sugarcane is a major source of renewable energy. Recognizing
this, the sugarcane-based plants are being upgraded in many
countries to become complete bioenergy plants or bio-refineries.
Bagasse, one of the main by-products of the sugar milling process
and once seen as a nuisance, is now being valued for the multiple
Fig. 10. Evolution of thermo power capacity in Brazil (1974e2009) [3].
Fig. 11. Evolution of hydropower capacity in Brazil (1974e2009) [3].
D. Khatiwada et al. / Energy 48 (2012) 241e254 247
uses it can provide. Bagasse is being used to generate heat and
electricity required to run the sugar mills in combined heat and
power plants (cogeneration). Bagasse availability varies from23% to
37% at 48e50% moisture content among sugarcane producing
countries. In addition, during sugarcane harvesting, abundant
sugarcane trash/waste (i.e. tops, leaves) are left in the fields, which
can also be used as fuel in boilers of cogeneration systems. Table 2
shows the amount of sugarcane production, the percentage of
bagasse and sugarcane trash/waste availability in Brazil and Nepal.
In Brazilian conditions, bagasse production averages 280 kg per
tonne cane with moisture content of 50%, while in Nepal bagasse
production reaches 362 kg per tonne cane at the same moisture
level. The use of different sugarcane varieties actually affects the
fibre and sucrose content [21].
Sugarcane biomass has tremendous potential to generate
surplus electricity. Many sugarcane producing countries have
started to produce surplus electricity fromsugarcane biomass to be
fed into the national grid, for example, India [24e28], Mauritius
[29e31], and Brazil [20,32e34].
4.2. Bagasse cogeneration technologies
Cogeneration is the production of more than one useful form of
energy (such as process heat and electric power) from the same
energy source. Cogeneration plants for heat and surplus power
generation are becoming mainstream as a result of technological
innovation and efficient resource utilization. In industrial cogene-
ration (CHP), biomass or coal fired boilers and steam turbines are
used to generate electricity and exhaust steam is utilized for the
industrial processes as process heat. In sugar industries, conven-
tional cogeneration uses bagasse-fired boilers in conjunction with
a backpressure and/or condensing-extraction steam turbine
coupled with an electrical generator.
The use of high pressure boilers, efficient turbines, and adoption
of state-of-the-art energy efficiency measures can significantly help
to optimize, and thereby increase cogeneration power in the form
of electricity, reaching up to 40% efficiency (i.e. power output as
percentage of fuel input) in condensing-cum-extraction steam
turbine (CEST) [35]. Meanwhile, the overall efficiency (i.e.
combined heat and power output per fuel input) crosses 90% in
backpressure steam turbine (BPST). Exergy or Second Law effi-
ciency, which exactly indicates the quality of heat in terms of its
work potential, can be used to find the resource utilization at the
bagasse-fired cogeneration plant [36,37]. For example, Kamate and
Gangavati (2009) [36] have performed exergy analysis of a heat-
matched bagasse-based cogeneration plant and found that, at
steam inlet conditions of 61 bars and 475

C, the backpressure
steam turbine cogeneration plant performs with energy and exergy
efficiency of 86.7% and 30.7% respectively. The choice of suitable
technological configurations depends on, among other factors,
economy (i.e. investments and returns) and need of surplus power.
Steam based cogeneration has a wide range of technological
configurations, viz., extract-cum-back pressure, extraction-cum-
condensing, and condensing route based on dual fuel system
[25,26,38,39].
4.3. Cogeneration configurations for surplus power
Sugarcane mills generally use 28 kWh of power and 500 kg of
steam per ton-cane processed [40]. Overtime, technologies for
cogeneration have become more efficient with the adoption of high
pressure boilers and state-of-the-art turbines. At present, boilers
and turbines (backpressure or condensing turbines with or without
a controlled extraction) are being used at pressure levels varying
from 15 to 105 bars, and temperatures ranging from 300 to 525

C,
depending on the need for surplus power. Condensing-cum-
Extraction Steam Turbine (CEST) based system is the state-of-the-
art technology for bagasse cogeneration in terms of maturity and
commercialization, as well as potential for generating surplus
power [38]. They have therefore been increasingly used in the
sugarcane industries.
However, there is a large number of options for cogeneration.
Table 3 shows typical bagasse cogeneration configurations with
values of surplus electricity in Brazil, India and Mauritius. By
improving the efficiency of cogeneration systems, and reducing the
use of process heat and power consumption, we can obtain more
surplus electricity for sale to the grid [40]. Using the CEST tech-
nologies at high pressure and temperature (up to 82 bars and
525

C), Mauritius can produce 75e140 kWh of surplus electricity
per tonne of cane (kWh/tc). Surplus electricity at the range of
158 kWh/tc can be generated from the cogeneration systems at
105 bar and 525

C by reducing steam demand to 280 kg per tonne
of cane and utilizing all bagasse and 50% of sugarcane trash. Thus,
the bioelectricity potential depends on the type and operating
configuration (pressure and temperature) of the cogeneration
systems, see Table 3. In addition, BIG-CC gasification technology can
be used in the future, further increasing surplus bioelectricity
potential by more than 250 kWh per tonne cane [41].
Table 2
Sugarcane production and sugarcane biomass.
Particulars Brazil Nepal
Sugarcane available in sugarcane mills 622.6
a
1.8
b
Cane productivity during harvesting
(tonne/ha) [4,22]
80 41.6
Average bagasse availability (%) 28% 36.2%
Cane trash, kg per tonne of cane stalk
(at 50% moisture content)
c
280 250
Sugarcane biomass (bagasse plus trash),
kg per tonne cane (at 50% moisture)
d
420 487
Average crushing period (days) 200 150
Moisture content of bagasse is considered as 50% for the both countries.
a
National energy balance data sheet for 2009 (Brazil) [3].
b
In Nepal, 30% of the sugarcane is used for producing domestic sweeteners, only
the rest (70%) comes to the sugar mills [4].
c
In Nepal, cane trash recovery is 25% of the cane stalk (with 50% moisture
content). 50% of the cane trash is left in the field. Therefore, 50% is available for
combustion [23]. In Brazil, cane trash yield is about 14% (dry mass) of the cane stalk
[21].
d
In this study, we assumed that 50% of the cane trash would be combusted in the
boilers for cogeneration.
Table 3
Surplus electricity production - a regional review.
Country Power
mode
Operating
configuration
Use of
trash
Surplus
exportable
electricity
(kWh/tc)
Brazil BPST 22 bar and 300

C No 0e10
BPST 42 bar and 440

C No 20
BPST 67 bar and 480

C No 40e60
CEST 65 bar and 480

C Yes (50%) 139.7
CEST 105 bar and 525

C Yes (50%) 158
India CEST 67 bar and 495

C No 90e120
CEST 87 bar and 515

C No 130e140
Mauritius BPST 20 bar and 325

C No 25
BPST 31 bar and 440

C No 45
BPST 45 bar and 475

C No 53
CEST 45 bar and 440

C No 75
CEST 82 bar and 525

C No 130e140
Source: [38,40].
BPST: Back-Pressure Steam Turbine.
CEST: Condensing-extraction steam systems.
BIG-CC: Biomass Integrated Gasification Combined Cycle.
D. Khatiwada et al. / Energy 48 (2012) 241e254 248
4.4. Generating bioelectricity from bagasse cogenerations e
a regional perspective
Mauritius, Brazil, and India are pioneering on bagasse cogene-
ration technologies, bioelectricity production and sales to the grid
[25,31,32,38,42]. In Mauritius, bagasse cogeneration contributes
19% of the total national electricity [43]. In India, the potential of
electricity from bagasse cogeneration is 34 TWh (i.e. about
5575 MW in terms of the plant capacity) [25]. Indian sugar mills
have started to implement the high pressure and temperature
configurations since 1990s. Sharma and Sharma [26] mentioned
that an improved configuration can provide 9e10 MW of surplus
power for export froma standard sugar mill of size 2500 tonnes per
day during the crushing season. The government of India is also
encouraging the sugar mills to generate surplus power for selling
into the grid using a number of incentive schemes [25,26]. In the
last 15 years, India has commissioned 1636 MW bagasse cogene-
ration plants and the capacity of grid connected plants varies from8
to 12 MW, including two dozen plants using 110 bar and a few mills
for 130 bar pressure [28]. In 2009, Brazil produced 4600 MW
bagasse power, and the surplus electricity sold to the grid
amounted to 1150 MW (i.e. 25% of the total production) [44].
During the period from2005 to 2009, sugarcane mills in Brazil have
exported 15.84 TWh of electricity to the grid [45]. The figure for the
year 2009 was 5.87 TWh (i.e. 670 MW
average
).
4
4.5. Assessing the bioelectricity potential in Nepal and Brazil
For our present analysis, the cogeneration configuration shown
in Table 4 is used in evaluating the surplus electricity potential. As
discussed above, the technology is readily available in some formin
most of the sugarcane producing countries (e.g. Brazil, India, and
Mauritius). The range of the surplus electricity (e.g. 100e150 kWh
per tonne cane for the Brazilian case) is taken in order to incor-
porate the corresponding values of pressure/temperature, heat and
steam consumption in the sugarcane mills. Since the bagasse
availability is high (36.2%) in Nepal, values for surplus electricity
potential are adjusted accordingly, considering the actual amount
bagasse and trash generation (also see Table 2) for the cases of
Nepal and Brazil. The cogeneration potential is based on the
condensing-extraction steam turbine systems.
4.5.1. Bioelectricity potential in Nepal
Nine sugar mills are currently in operation in Nepal, all owned
by private companies. The average crushing period comprises
approximately 150 days (from DecembereMay, dry season in
Nepal). Sugar industries in Nepal are self-sufficient in their energy
requirements. At present, bagasse cogeneration is using low pres-
sure boilers and backpressure turbines at 19e21 bar and
300e340

C. A case study in one of the sugar mills in Nepal show
that 17% excess bagasse can be generated from the present set-up,
after meeting internal energy requirements [46]. But, there is no
provision to store bagasse (due to space limitation) and/or sale
surplus electricity into the national grid. The excess bagasse is
simply burnt or incinerated in the boilers as a waste.
Adoption of the high pressure boilers and the-state-of-the-art
turbines can drastically increase electricity generation capacity.
Assuming the best available technology - whose special features are
presented in Table 4 - total electricity generation would be
313 GWh with the installed capacity of 87 MW (or 36 MW
average
).
Table 5 shows the energy parameters in both lower and higher
ranges. MW
crushing
is the installed capacity of turbines when the
cogeneration only runs during the crushing period, while MW
aver-
age
provides the energy capacity if the plant can run throughout the
year. Further, sugar mills in Nepal have capacities ranging from 800
to 3000 metric tons (tonnes) per day. Therefore, the size of
cogeneration plants for surplus electricity varies from 5 to 19 MW.
4.5.2. Bioelectricity potential in Brazil
Brazil conventionally uses backpressure turbines and bagasse-
fired boilers to raise steam at 300

C and 21 bars. In this case,
electrical and mechanical energy obtained in the cogeneration is for
internal use only and backpressure steam at 2e2.5 bar used to fulfil
the process heat requirements. However, some mills have already
started using steamwith medium to higher parameters (42e67 bar
and 440e480

C), delivering surplus electricity into the grid [40].
As shown in Table 6, surplus electric power generation potential
was in the range of 62.3e93.4 TWh (i.e. 7107e10,661 MW
average
) in
2009, considering the surplus electricity at 100e150 kWh/tc.
4.6. Pricing bioelectricity from cogeneration of sugarcane biomass
Investment per kW and power generation cost (i.e. cost per
kWh) can play critical roles in the selection of power generating
plants, i.e. hydro, thermal, nuclear or renewables. These costs
should be at a minimum competitive level for sustaining the
project in the long-run. Costs of bioelectricity from cogeneration
plants vary widely and depend upon types of feedstocks, sizes of
the plant, availability of feedstock (including transportation), and
conversion technologies. Further, the techno-economic consider-
ations for choosing conversion technologies are determined by
cost, load factor, efficiency, feedstock, scale and robustness [43].
While producers are more concerned with unit energy cost (per
kWh) linked with economies of scale, users showhigh willingness-
to-pay if the technology performs with high integrity, reliability,
convenience, safety, and availability [43].
Evans et al. [47] indicate price as one of the key indicators for the
sustainability of electricity generation from biomass. The cost of
Table 4
Parameters for surplus electricity in Brazil and Nepal.
Surplus exportable electricity (kWh/tc) 100e150 (Brazil)
115e175 (Nepal)
a
Operating configuration (pressure and temperature) 65e120 bar
480e525

C
Power consumption in sugar mills (kWh/tc) 28e30
Steam consumption in sugar mills (kg/tc) 350e500
These values are based on the utilization of bagasse and 50% of the trash that is
available in the field.
Cogeneration is based on CEST systems.
a
Since bagasse availability is high in Nepal, these figures were adjusted accord-
ingly. It should be also noted that kWh per tonne cane can still be higher in Nepal
since a fraction of surplus biomass (per tonne cane) can solely be used for producing
power. On the other hand, sugarcane yields (tonne/ha) are very lowin Nepal, almost
the half compared with Brazil. Increased sugarcane yields will generate more
biomass that can be used for bioelectricity. However, this potential is not considered
in this analysis.
Table 5
Surplus electricity potential in Nepal.
Parameters Lower range Higher range
GWh 209 313
MW
average
24 36
MW
crushing
58 87
The total installed capacity (MW
crushing
or simply MW) is estimated based on an
average sugarcane crushing period of 150 days in Nepal, while the average capacity
(MW
average
) is the yearly average MW, estimated at 365 days, dividing total energy
generation (i.e. MWh) by the numbers of hours (¼24*365 ¼ 8760) in a year.
4
Average capacity (MW
average
) is estimated by dividing total annual energy
generation (in MWh) by the numbers of hours (¼24*365 ¼ 8760) in a year.
D. Khatiwada et al. / Energy 48 (2012) 241e254 249
electricity generation is the lowest for waste materials with little or
no cost and minimal transportation requirements. Cogeneration at
sugar mills uses bagasse e a residue or waste (also, a by-product) -
to generate heat and power. The prices for power production from
the combustion of sugarcane bagasse ranged between 4.5 and
7.1 US ¢ per kWh (with large size plant in 1999), 4.9 US ¢ per kWh
(with 23.4 MWplant in 2000), 6 US ¢ per kWh (with 600 MWplant
in 2008) [47]. Costs (per kWh) for other sources are 24 US ¢
(photovoltaics), 6.6 US ¢ (wind), and 5.1 US ¢ (hydro). Electricity
generation from biomass and hence bagasse cogeneration can be
considered as the second most profitable renewable energy source
after hydropower in terms of total energy and carbon reduction
costs [47]. It is worthwhile to note here that in Brazil, as mentioned
earlier in Section 3.3, the price of electricity generation from
sugarcane biomass (i.e. one of the renewables) is fixed through the
auctioning process. For example, an auction (held on August 2010)
to procure electricity from biomass power plants set an average
price of 8.2 US ¢ per kWh (i.e. R$ 145.37 per MWh).
5
In Mauritius
and Reunion, the investment cost for a bagasse cogeneration plant
was US$ 1000 per kW[48]. In India, the capital cost of installation of
bagasse-based cogeneration plants ranges from US$ 1020 to US$
1134 per kW, depending upon technical (e.g. boiler pressure),
financial and operating parameters [28].
6
The installation cost for
a turbine to generate a 15 MWsurplus was US$ 800 per kWin Brazil
[42]. Thus, we see that the price of electricity generation from
bagasse cogeneration is very cost competitive, albeit showing large
variability depending on regional location, pricing policy, size of the
plant and processing technologies. Owing to its short development
period with proven and well established technologies, capital costs
can be recovered by selling electricity to the national grid with
payback periods of three to five years [42].
5. Complementing hydroelectricity with bioelectricity
Investments in large dams/hydropower projects, fossil based
thermal plants, and nuclear power have become debatable globally
mainly due to environmental and safety reasons. In face of these
concerns, initiatives towards renewable and cleaner energy
systems have intensified to meet ever increasing demand for
electricity. Biomass cogeneration (bioelectricity) in sugarcane-
based systems can provide multi-benefits not least as a comple-
ment to conventional electricity generation. We discuss here the
opportunities and barriers for the exploration of this bioelectricity
in Brazil and Nepal.
5.1. Opportunities and barriers in Brazil
Over reliance in only one source of energy (i.e. hydropower)
with high dependency on hydrological/water cycles (e.g. rain falls,
drought) increases uncertainty and vulnerability of the electricity
supply. Seasonal variations in electricity generation from hydro-
power can be strengthened by extreme weather conditions,
compromising the delivery of electricity when water levels are low
in dams and reservoirs. Thus, diversification of the energy sources
is necessary, not only to secure energy supply but also to guarantee
availability and optimization of natural resources. After the energy
crisis of 2001, new investments on fossil (i.e. natural gas, oil and
coal) based thermal plants have been made, leading to a continuous
increase in their role in the Brazilian energy matrix (see Fig. 10,
Section 3). Fossil based thermoelectric generation is being consid-
ered as the complementary option for hydropower.
Bioelectricity can play a significant role in complementing the
electricity from hydro and reducing the use of fossil based power
generation. In the dry season, the production of hydroelectricity
goes down in Brazil. At the same time, this is sugarcane harvesting
time and electricity can be generated from bagasse and trash with
great reliability. Bagasse cogeneration for bioelectricity production
takes place near the load centres, implying reduction of trans-
mission losses. Sugarcane agro-industries have increasingly been
contributing to the national macro economy, providing food (i.e.
sugar), energy (i.e. ethanol and biomass for energy/bioelectricity)
and employment. Scaramucci et al. [49] have shown that electricity
from sugarcane biomass could alleviate the economic impacts of an
electric energy shortage crisis on the GDP (gross domestic product).
Cogeneration systems from sugarcane biomass are already in place
in many sugarcane industries to produce surplus bioelectricity but
some need upgrading of the equipment (i.e. high pressure boilers
and turbines). The construction period is relatively short and costs
are quite competitive as previously discussed. Electricity from
biomass cogeneration is also more attractive than fossil based
thermal power plants when it comes to reduce GHG emissions [47].
In addition, cogeneration systems based on sugarcane biomass run
at the lowest range of unit variable cost compared to other thermal
systems (e.g. fossil based) as bagasse fuel is low-priced. While
considering optimized merit order dispatch of electricity in the grid
in terms of the overall costs and environmental performance
(i.e. kgCO
2eq
/kWh), bioelectricity from the cogeneration systems
could represent a portion of the base-load at least during the dry
season. Thus, there is plenty opportunity to harness untapped
bioelectricity from sugarcane biomass. Bioelectricity not only
comes fromrenewable sources, but also contributes to diversify the
electricity matrix.
Fig. 12 shows the trend of electricity generation by fuel types,
including the potential of bioelectricity. In 2009, sugarcane mills
produced 14.1 TWh (i.e. 3% of the total production) of bioelectricity
from cane-bagasse, mostly used to meet internal power require-
ments at mills. However, Brazil has not made significant progress in
the generation of bioelectricity despite a successful ethanol
program and abundant sugarcane biomass. With the use of high
pressure CEST systems and cane trash, surplus bioelectricity could
increase up to a level of 93.4 TWh which is 20% of the total
generation (i.e. 466.2 TWh). Meanwhile, sugarcane production has
been growing at an average rate of 10.5% rate per year since 2000,
implying an equal continuous increase in the potential for
bioelectricity generation (see Fig. 12).
One of the targets of the government program(i.e. PROINFA) was
to increase shares of electricity from renewable energy sources.
However, the programhas not been effective to meet the PROINFA’s
target in the first phase [45]. The selection criteria have not
considered complementarities, industrial and technological devel-
opment, the generation cost and efficiency of the projects, among
others [18,50]. Further, the three renewables have competed with
each other, in spite of having equal and huge technical potential.
In the past, thermal power plants based on fuel-oil have become
successful in the auctioning process since the investment cost of
Table 6
Surplus electricity potential in Brazil.
Parameters Lower range Higher range
GWh 62,260 93,390
MW
avarage
7107 10,661
MW
crushing
a
12,971 19,456
a
MW
crushing
is estimated based on an average sugarcane crushing period of 200
days in Brazil.
5
See at the link: http://www.ambienteenergia.com.br/index.php/2010/08/leilao-
de-energia-usinas-a-biomassa-fecham-negocios/5535. The exchange rate for Bra-
zilian currency is: US$ 1 ¼ Brazilian R$ 1.77 [as on 25 August 2010].
6
The exchange rate for Indian currency is: US$ 1 ¼ ICR 44.1.
D. Khatiwada et al. / Energy 48 (2012) 241e254 250
those power plants are much lower compared to natural, coal and
biomass and wind [17]. Wind and biomass-based power plants
have been marginally benefited by the introduction of new rules in
2008, which aimed to reduce the advantage of fuel-oil power
plants. However, the main problem related to the selection criteria
based on Cost-Benefit Index (ICB) has not yet been solved, and this
needs to be corrected to promote a fair cost comparison between
thermal power projects [17]. Further, cogeneration in sugar mills
cannot deliver firm power throughout the year based on sugarcane
bagasse and trash only, as needed by power sectors. Sugarcane
production is seasonal but both storage and complementary
biomass sources and synergies with other industries ought to be
considered to extend the electricity generation season. Another
option is differentiation of electricity production during the wet
and dry seasons which is not made in the current regulation for
thermal power production, but could be further elaborated.
The trash collection and transportation of the sugarcane trash/
residues is one of the unresolved bottlenecks at the moment. There
is not an established technology yet for collecting the trash effi-
ciently, and there is uncertainty regarding costs to accomplish that.
However, optimized collection would greatly reduce costs and
emissions [34]. Storage of excess biomass can be logistically
expensive [39] but biomass storage and transport is under devel-
opment, and also new concepts are being tested opening oppor-
tunities for synergies with other biomass inputs for cogeneration in
the future. Better cogeneration efficiency will be achieved if the
plant can run the whole year.
Another bottleneck in the Brazilian system is the connection of
the cogenerated surplus bioelectricity into the energy distribution
network. Although the regulation requires open access, there are
still issues with the electricity distributors including costs for the
connection and transmission, and electricity prices.
5.2. Opportunities and barriers in Nepal
In Nepal, most hydropower plants are of the run-of-the-river
type. This means that they are subject to seasonal river flows, and
cannot provide electricity in their full capacity in the dry season.
Total installed capacity is also very small. Nepal can hardly afford to
run thermal plants with imported fossil fuels. Lack of infrastructure
for better use of the country’s hydroelectric and biomass potential,
coupled with limited financial resources is causing a colossal load-
shedding situation. Installation of high pressure boilers and
turbines in sugar mills, replacing existing low pressure back-
pressure turbines could provide a windowof opportunity to supply
significant amounts of electricity to the grid. Since the dry season
and the period of operation of the sugar mills coincide, the
complementarity of the two sources is straight forward, facilitating
the exploration of this untapped opportunity. For instance,
313 GWh of surplus electricity could have been sold to the grid in
2006/07.
7
Taking yearly average values during the crushing period
(in 150 days), electricity consumption in the residential and
industrial sectors (which represent about 83% of the total
consumption in 2006/07) were 367 GWh and 390 GWh, respec-
tively. Thus, bioelectricity could cover about 41% of this electricity
consumption during the crushing period, see Fig. 13. It should be
noted that the total generation of electricity in the year 2006/07
was 2051.8 GWh including 10.8% (i.e. 329 GWh) electricity imports
from India (see Fig. 14). The demand is drastically increasing but
there is a limited source of electricity generation which can only be
changed through new investments in generation capacity. Nepal
has imported 613 GWh (16.6% of the total production, i.e.
3689 GWh) of electricity at a price of Rs 10.72 (i.e. 14.9 US ¢)
8
per
kWh in 2010.
As presented in Figs. 13 and 14, total electricity consumption in
the twomajor sectors (i.e. residential andindustrial) has abnormally
Fig. 12. Electricity generation in Brazil, by source 2000e2009 (secondary axis shows the total hydropower generation) Source: Ministry of Mines and Energy, (MME) [3]; Surplus
bioelectricity projection by authors.
7
To calculate the surplus bioelectricity potential from sugarcane biomass,
production data for 2006/07 is used because during the last two years the
production has almost stagnated due to political turmoil in the sugarcane growing
areas of Nepal.
8
The prices of electricity at delivery and consumer points were Rs 10.72 (15 US ¢)
and Rs. 13.40 (18.6 US ¢) per kWh, respectively. It should also be noted that average
sales tariff after rebate is Rs 6.57 (9.12 US ¢) per kWh.
D. Khatiwada et al. / Energy 48 (2012) 241e254 251
decreased from the year 2007e2009 due to non-availability of
electricity in the grid e both from internal production and imports.
This has led to a negative impact on socio-economic and industrial
development in the country. In 2010, electricity import was
increased by 72% compared to the previous year. Nevertheless, the
ever increasing demand for electricity has not been fulfilled. If
surplus bioelectricity from domestic renewable sugarcane biomass
is connected to the grid, Nepal can save US$ 47.1 million (i.e. Rs 3.4
billion) by substituting a similar amount of imported electricity (see
Fig. 14). The potential monetary saving is enormous.
The total available hydropower capacity is only 272 MW during
the dry season [9]. Bioelectricity could provide about 32% of this
capacity (i.e. 87 MW) at the peak in this season. Further, electricity
consumption remarkably varies during the day. Bioelectricity could
serve peak hours of the day, provided that there is enough storage
facility to store excess bagasse. The production potential (i.e. kWh/
tc) might also increase if cogeneration is run without extracting
steam for process heat.
Cogeneration plants are located close to industrial corridors and
densely inhabited rural areas in the plain land of Nepal. Therefore,
transmissionanddistribution(T&D) losses wouldbe lower whenthe
electricity is dedicatedtoindustrial andresidential needs of the local
areas. Note that the system losses in T&D were 28.6% in 2009. The
size of cogeneration plants varies from 5 to 19 MW, making them
suitable for distributed energy systems aimed at local electricity
demand. The scale and distributed character of the resources
contribute to reduce investment needs particularly with long-
distance transmission grid systems. Thus, bioelectricity contributes
to increase reliability and stability of electricity systems in Nepal.
On the other hand, the initial investment on high pressure
boilers and turbines to generate surplus electricity is high for sugar
industries if no incentives are provided. The market conditions for
bioelectricity is also not clear in Nepal since there are no provisions
regulating grid conditions to receive surplus bioelectricity from
cogeneration systems. Though the energy emergency plan of 2008
mentions that excess captive power from industries can be sold to
the grid, this has not been materialized yet and interconnection
arrangements are not clear. Basic infrastructure (such as substation
and associated electromechanical equipment) is required to
transfer bioelectricity into the grid. One of the major hurdles of
sugarcane production and operation of sugar industries in Nepal is
lack of political stability and weak institutional performance. Due to
disturbance in sugarcane cultivated areas, the yield (tonne/ha)
which is already low, has not improved in the last three years.
Overall, lack of government policies, political instability/distur-
bances, and week institutional set-up are the major obstacles to
Fig. 13. Electricity consumption (residential & industrial) and potential surplus
bioelectricity during the sugarcane crushing period in Nepal (2000e2010) Source:
Nepal Electricity Authority (NEA) [8]; Estimation of surplus bioelectricity by authors.
Fig. 14. Electricity consumption (residential & industrial), imports of electricity and potential surplus bioelectricity in Nepal (2000e2010) Source: Nepal Electricity Authority (NEA)
[8]; Estimation of surplus bioelectricity by authors.
D. Khatiwada et al. / Energy 48 (2012) 241e254 252
investments in cogeneration for realizing the potential of surplus
bioelectricity in Nepal.
5.3. Discussions on realizing the bioelectricity potential in Nepal
and Brazil
The new context of energy markets seems conducive to the
development of bioelectricity. On the one hand, global energy and
climate policies favour the search for renewable options and, on the
other hand, there is increasing understanding about the bioenergy
potential in many countries and regions of the world. Nevertheless,
the use of biomass for electricity generation has evolved slowly
even in countries where the potential is large and the gains
identifiable.
Sugarcane biomass for electricity generation can potentially
complement hydroelectric power in Brazil and Nepal. This would
help diversify the electricity systems and enhance security of
supply, while also reducing system vulnerability and the risks
imposed by droughts. Availability of resources and efficient proven
technologies provide the basis for exploring sugarcane-based
bioelectricity in the two cases. Short project development and
implementation time, and the opportunity to explore various plant
scales, add to the attractiveness of bioelectricity as a renewable
option to be explored. In Nepal, the grid connected bioelectricity
from sugarcane biomass can provide power to guarantee well-
functioning industries, and help local development through rural
electrification. Also in Brazil, bioelectricity can balance hydropower
availability. Bioelectricity has a great potential to grow in line with
the continuous development of the ethanol industry, not only
through a more efficient use of huge amounts of bagasse, but also
through enhancement of the biomass potential with better utili-
zation of trash from sugarcane fields.
Nevertheless, while resources abound and efficient cogenera-
tion technologies based on sugarcane biomass are mature and
commercially available, the realization of the bioelectricity poten-
tial is only slowly evolving. Even in a country such as Brazil, where
the sugar-ethanol industry has experienced continuous develop-
ment from agriculture to fuel production, and become bench-
marking as a fuel alternative to transport, potential synergies for
bioelectricity production are only slowly being explored. This
implies lost opportunities for further increasing resource and
economic efficiency in the sugar-ethanol industry, and in the Bra-
zilian energy system as a whole. In Nepal, improved resource effi-
ciency in the sugarcane-based industry can significantly improve
security of electricity supply, reduce public financial costs with
fossil fuel imports, and also foster efficiency improvements in
agriculture and rural development.
Regulatory and institutional issues have been partly addressed
in Brazil and, to a less extent, also in Nepal. The expansion of power
production in the Brazilian electric system has been stimulated
through auctions promoted annually, while Nepal intends to
purchase hydroelectricity from IPP. But these policies do not seem
enough to boost the large potential available. The dynamics of
multiple market actors, including the increasing participation of IPP
and their position in relation to grid access, for example, are not
completely solved. Also the logistics of power complementarity
need better understanding, planning and monitoring so that the
synergies between hydropower and bioelectricity can be fully
explored.
Policies need to appreciate the different character of various
technologies. These differences are not only of technological nature
but refer also to whole supply-chains and the possibilities to
develop attractive business models for the potential actors that can
be involved in the energy sector. In the case of Brazil, auctions have
served well as a mechanism to foster wind power, but not as much
bioelectricity. Biomass-based generation involves multiple actors
which in turn lead to more complex project finance. This could be
one of the obstacles reducing the attractiveness of bioelectricity
projects. To address these obstacles, the specific characteristics of
the bioelectricity segment, the actors involved and their various
possible constellations at different scales need to be addressed, and
reflected in policy mechanisms. If the policy framework and
incentives are there to help, markets can be better used to promote
innovative energy systems. This approach is also valid for poor
countries such as Nepal, where market forces could be triggered in
efforts towards decentralized rural electrification. Joining the two
parallel lines of energy system planning and development,
centralized and decentralized approaches, will be important to
coordinate efforts and improve total system efficiency.
Last but not least, as international cooperation in the energy and
climate agenda continues to evolve increasingly contemplating
energy security and climate gains, new opportunities arise for
Brazil and Nepal to further explore electricity from biomass and
hydropower. Recently established diplomatic relations between the
two countries serve to enhance technical cooperation in the fields
of agriculture, energy, and industry, with great advantages to both
sides.
6. Conclusions
Part of the shortcomings observed in Brazil and Nepal, two
countries with large potential for renewable electricity from both
hydro and biomass sources can be explained by the traditional
planning approach to electricity. In both countries, energy planning
has for many years focused on large-scale hydropower solutions for
grid connection. Decentralized electricity generation, at various
scales, and as a combination of multiple resource alternatives is still
a relatively new concept that is not completely integrated into the
planning practices of these countries.
Certainly, energy research and planning are taking new direc-
tions due to the recognized need to adopt an energy systems
perspective. However, conceptual changes are not enough. Tradi-
tional thinking can lead towards further development of conven-
tional technologies based on an energy supply oriented approach.
This could help explain increasing use of fossil based thermal
options in Brazil despite the large biomass potential for sustainable
bioelectricity production. In fact, comprehensive energy planning
requires more than the identification of resources and technology
choices. It is necessary to broaden considerations on resource
availability, technology choices and reliability, and also ask ques-
tions about acceptability, cost returns and profitability. More
attention to both potential investors and users is necessary in
a competitive market for a better orchestration of actions towards
more efficient energy service provision.
Withinwell-functioning markets, incentives for innovation have
to be created, for example to promote better resource management
and increase energy efficiency such as in the case of the sugarcane-
based industry. There are potential synergies which may not easily
occur because they require efforts that are marginal to the core
activities of the industries affected. For example, most greenhouse
gas emissions come from energy harnessing and use, and signifi-
cant changes will have to take place in the way we organize energy
infrastructure as a whole and in each unit. However, synergy effects
exist with other sectors which affect energy demand and use. The
scale of emissions reduction needed will require a broader view of
possibilities for systems integration, for example, including agri-
culture and the multiple uses of sugarcane, including bioelectricity
generation. To explore potential synergies either sectoral or system
wise, innovative policies as much as technological innovation is
needed.
D. Khatiwada et al. / Energy 48 (2012) 241e254 253
Acknowledgements
This study is developed as part of partnership established
between the Brazilian Bioethanol Science and Technology Labora-
tory (CTBE), Brazil and KTH e Royal Institute of Technology,
Sweden. The study has been mainly funded by a scholarship from
the Brazilian National Council for Scientific and Technological
Development (CNPq), and a grant fromthe Swedish Energy Agency
through the program Global Energy and Climate Studies.
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