Global ethanol player

26 bioenergy parks4


Approximately 1 GW of bioenergy generation capacity4

4 The figures do not consider Biosev's nine units, which will be integrated during the 2021/20222 harvest. These assets are also not included in the indicators of this report.

We are present in people's lives, providing the energy they need—today and tomorrow. By investing in clean and renewable energy, we have become the largest producer of sugarcane ethanol in Brazil, selling different types (such as hydrous in different standards, anhydrous, and neutral) to various markets, both nationally and globally.

Selling the product as a raw material for small and large industries is yet another of our demands. Our customers include the largest companies in Brazil and in the world in the fuel, pharmaceutical, chemical, cosmetics, and beverage segments, among others.

We have achieved excellent results in ethanol production, guaranteeing the quality of products from end to end. For neutral ethanol, for example, we developed a project at the Bonfim Unit to leverage the sensorial quality of this product, which resulted in the approval of more than ten new customers in the beverage and cosmetics industries in both domestic and foreign markets.

With an inquisitive approach, we began to view sugarcane straw and bagasse, previously considered waste, as raw material for our second-generation ethanol (E2G), an advanced biofuel with the same chemical composition as regular ethanol; however, it reuses this waste through processes such as pre-treatment and hydrolysis, making it possible to access the sugars that are still contained in the fibers and increasing our production capacity by up to 50% using the same planted area.

Since 2019, we have been supplying our E2G for the formulation of perfumery products in the Nativa SPA line by O Boticário, the first cosmetics in Brazil to include a more sustainable type of ethanol in their composition. In 2021, this partnership was extended to Grupo Boticário's complete line of perfumery.

We are the only company in the world that produces E2G on a commercial scale in a continuous and uninterrupted manner, having already exported more than 80 million liters to the United States and Europe, and with solid plans for new plants in the short and long term.

One of our strategies to continue investing in renewable products includes exploring all the possibilities of sugarcane. We operate in a circular economy system, reusing all the by-products and inputs used in our processes to generate new forms of energy. By doing this, we are directly contributing to the environment, generating less industrial waste and creating sustainable products that will help clean up the Brazilian energy mix.

We are one of the world's largest producers of electric energy from sugarcane bagasse and straw, and all of our 23 bioenergy parks in operation for the 2020/2021 harvest are self-sufficient in energy consumption, while 13 of them sell their surplus to the National Interconnected System (SIN).

In October 2020, we began activities at our biogas plant in Guariba (SP). This is one of the largest biogas plants in the world. Using the by-products from filter cake and vinasse, it produces biogas that can be converted into electricity or biomethane gas—a substitute for natural gas and diesel in heavy vehicles.

This plant, which currently generates electricity and has an installed capacity of 21 MW in 153,100 sqm of built area, is adjacent to the Bonfim mill, where more than 5 million tons of sugarcane are crushed per year, generating a high volume of vinasse and filter cake to meet the needs of a commercial-scale biogas project. The vinasse will be uses during the harvest period, and the filter cake will be used throughout the year. This combination should produce around 138,000 MWh, of which 96,000 MWh will be sold through a contract agreed upon at an auction held in 2016. The surplus volume of energy can be negotiated in the free market or through other contracts. Raízen Geo Biogás, a joint venture with Geo Energética, will be responsible for operation and sales. With our biogas plant, we have assumed a strategic position in the renewable energy market. The project, which has an ambitious expansion plan for the next 10 years, marks a revolution in the treatment of agro-industrial by-products, consolidating the circular economy practice adopted in our production processes. We have a commitment to reach a daily production of more than 2 million Nm3/day of biomethane, which is also considered an advanced biofuel.

We also obtain biomass energy, which accounts for 8.3% of the Brazilian energy mix, by burning organic materials. Compared to fossil fuels, these by-products generate less greenhouse gas emissions. Our units have an installed capacity of about 1 GW for power generation, and our annual production of electricity from biomass amounts to 2.4 TWh. Together with energy trader WX Energy, besides selling energy in the free energy market, we have provided integrated and tailored solutions to different customer profiles, which generates a flow of contracts as we diversify the supply of products and services in our portfolio.

Through a joint venture with Sumitomo, in which we have an 81.5% stake, we have acquired a strategic position in the market for the production and sale of biomass pellets (sugarcane bagasse and straw). Our solution—instrumental in replacing coal in thermoelectric power plants for energy generation—has a capacity of 100,000 tons/year at the Diamante Unit. Our product has unique sustainability attributes when compared to wood pellets, and in the last harvest it was exported to large generators in the Netherlands and the United Kingdom. Given the international economic scenario, we have decided to hibernate the plant while monitoring the recovery of the market.

Another step into the future is our photovoltaic plant in a 40,000-sqm area next to the Costa Pinto unit, called mini-GD, with an installed power of 1.3 MWp, sufficient to supply a neighborhood in the city Piracicaba (SP) for a year. Since the opening of this plant in 2019, we have expanded our business in this segment and increased our generation capacity by 30 times, reaching a total volume of 51,567 MWh/year, capable of supplying a city of 50,000 inhabitants for a year. This expansion includes increasing the operation of the photovoltaic plant, in addition to six new plants already operating and connected to the grid: Capitão Enéas and Salinas (MG), Guararapes (SP), Amontada (CE), Petrolina (PE), and Tangará da Serra (MT). With this expansion, we have become the largest distributed generation company in multiple states, operating simultaneously in five states in Brazil.

Energy transition |GRI 103-2, 103-3 Climate change and energy transition|

Society's demand for clean energy is becoming increasingly stronger, driven by global trends that place sustainability at the heart of business. In Brazil, more than half of the energy mix is ​​based on renewable sources such as water, wind, and biomass. However, the situation in most other countries is very different, with a predominance of fossil sources. According to the Energy Research Company (EPE), the share of oil in global energy consumption is more than 30%, and it will remain the main energy source in the world for the next 15 years. In addition, fossil fuels, such as oil and natural gas, still represent greater security for the energy mix because they are dispatchable, i.e., they can be powered whenever needed, unlike intermittent alternatives such as wind and sun. But this is changing, and our commitment is to lead the transformation of the energy mix, looking to the future while continuing to meet the demands of today. The truth is that regardless of the source that will prevail, we will provide the energy needed to move people and power businesses.

In this way, while we expand our portfolio of renewable energy products and services, we also operate in fuel distribution with an infrastructure that provides efficiency and reach in logistics, as well as partnerships with resellers in more than 7,000 service stations strategically located in Brazil and Argentina.

Our leading role in the energy transition agenda is also made evident by the quality of Brazilian ethanol, a reference as a source of lower environmental impact. The ethanol blend of up to 27% in gasoline (E27) provides a 15% reduction in CO2eq emissions per kilometer compared to pure gasoline and up to 35% in hybrid vehicles.

As the largest global producer of first- and second-generation ethanol, promoting large-scale decarbonization for our customers and helping position them at the forefront of a low-carbon economy, we measured the greenhouse gas emissions that were avoided due to the consumption of our products—5.2 million tons per year, which represents approximately 2.5 million fewer cars on the streets.

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