Sustainable Development of Biofuels Program

1. Sustainable Development of Biofuels Program Biofuels 2010 - For Sustainable Rural Livelihood & Energy security Swaroop Sarangan, Vice President November 19, 2010, New Delhi, India

2. Contents 1. Indian Biofuels context 2. Biofuels Development Challenges 3. Reliance Biofuels Initiative 4. Summary

3. India Energy Context • Energy demand 315 million MTOE • 8 times growth envisaged to 2030 • 75% import dependent • Fossil fuel based • Crude oil consumption 111 million tonnes growing 5.6% per year • Gasoline consumption 11 million tonnes, growing 5% per year • Diesel consumption 55 million tonnes, growing 5.2% per year • Administered price regime • High taxes (30% of value chain) • Limited alternate energy play (mainly wind) India’s energy demand is estimated to grow eight times to the year 2030.

4. Global Biofuels Opportunity Jatropha with Corn as intercrop Source : BP, US Energy Information Ad ministration, PFC Energy, US Chamber of Commerce, Reliance Research * Biofuels (especially biodiesel) blending limit can potentially go up to 100% which would provide upside to the above projections. Global biofuels opportunity is significant, but current market penetration of biofuels is very low. 4

5. India Biofuels Opportunity Jatropha with Groundnut as intercrop Source : Frost & Sullivan, Govt. of India Planning Commission, Ethanol India * Biofuels blending limit can go up to 100% which would provide upside to the above projections. India biofuels opportunity is also large, but current market penetration is negligible. India has 40 million ha of wasted land 5

6. Social-Economic Opportunity • Benefits • Better energy security • Higher farm incomes • Better quality of rural life • Use of marginal land • Carbon Sequestering Biofuels have significant social benefits, most important among them being higher farm incomes and better rural life.

7. Biofuels – Product/Market • Products • Bioethanol • Biobutanol • Biodiesel • Renewable diesel • BTL Diesel • DiMethyl Ether • ETBE • Markets • Gasoline • Diesel • Jet fuel • Fuel oils Biofuels primarily comprise bioethanol, biobutanol and biodiesel for blending with gasoline, diesel and fuel oils.

8. Renewable Biomaterials • Bioethanol/Biobutanol • Sugars • Sugarcane, Sugar beet • Starch • Corn, Sweet Sorghum, Wheat • Biodiesel • Vegetable Oils • Non-edible: Jatropha, Pongamia, Jojoba, Simaruba • Edible: Palm, Rape seed, Soybean, coconut, others • Animal Fats and oils • Algae • Yeast Sugar and grain crops are used to make bioethanol, while vegetable oils, animal fats are used to make biodiesel.

9. August, 2007 November, 2007 December, 2009 July, 2008 Technology • First generation • Sugars/Starch to bioethanol • Fermentation; Downstream separation and purification • Oils & Fats to biodiesel • Pre processing and trans-esterification • Second generation • Biomaterials • Hybrids; Transgenics; Algae; Yeast • Biomass to bioethanol/butanol • Hydrolysis, fermentation, separation • Gasification, fermentation, membrane separation • Chemical • Renewable diesel (refinery hydrotreater) • Pyrolysis or gasification and FT to jet fuel Jatropha yield cycle, Andhra Pradesh, India While first generation technologies are commercially used, several second generation technologies are being developed.

10. Govt. of India Biofuels Policy - Summary • Development of biofuels will be to utilise degraded forest and wastelands for cultivation of biofuel crops, using non-food feedstocks • 20% blending of biofuels by 2017. • Storage, distribution and marketing of biofuels would rest with Oil Marketing Companies (OMC). • Policy proposes Minimum Purchase Price (MPP) for biodiesel by OMC’s. • The policy proposes Minimum Support Price (MSP) for non-edible oilseeds. • R & D grants would be provided for projects involving second generation biofuels, new feedstock development, utilization of byproducts etc. • Any import or export of biofuels would be permitted only to extent necessary (exports only after meeting domestic requirements). Jatropha with Black gram as intercrop GOI biofuels policy revolves around growing non-edible crops on cultivable waste lands.

11. Biofuels – Competitiveness Challenge • Competitiveness with prices of gasoline (51 Rs/L) and administered prices of diesel (41 Rs/L) • Competitiveness drivers • Biodiesel (farm productivity, seed oil content) • Bioethanol/Biobutanol (biomass cost, enzyme cost) • Byproduct value Farm productivity, seed oil content and by-product value are critical drivers of biofuels productivity.

12. Contents 1.Indian Biofuels Context 2. Biofuels Development Challenges 3. Reliance Biofuels Initiative 4. Summary

13. Biofuel Development Issues (1) • Product Issues • Selection, blend ratios, GHG emission savings and oxygen content. • Industry Issues • Feed stock availability, site, technology and competitiveness • Supply chain Issues • Plantation material, plantation window, produce aggregation and transportation cost • Business Issues • Operability, scale, economics and sustainability. There are significant development challenges for biofuels, primarily on the linkages, logistics and competitiveness.

14. Biofuel Development Issues (2) • Farm Issues • Farm productivity, Yield and intercrop income • Technology Issues • Feed stock engineering, second generation technology, by-product value addition and IP • Socio-Economic Issues • Non-food crops, feed stock cost, subsidies, sustainability and farmers long term commitment Other significant development challenges for biofuels are on the development of sustainable feedstock and technology.

15. Product Issues Source: CERA Biodiesel goes twice as far and is better on GHG, fossil energy savings and emissions, as compared to bioethanol.

16. Land Productivity Jatropha bund plantation Source: CERA Bioethanol crops score better from a land productivity point of view.

17. Water Usage Source: Reliance Life Sciences Research Water usage varies based on nature of crop and irrigation, but Jatropha and algae (brackish) perform best.

18. Energy Ratios - Reliance Study Source: Reliance Life Sciences Research Biodiesel crops generally perform better from an energy ratio standpoint.

19. GHG Emissions Source: Union for Promoting Oilseeds and Protein Plants Both bioethanol and biodiesel crops perform better from a GHG emissions standpoint.

20. Cost Competitiveness Cost Competitiveness * Ex Factory gate price; ** Jatropha seeds - Rs.12/kg At current seed prices, biodiesel is not competitive. Bioethanol (sugarcane based) is competitive at US$ 50/bbl.

21. Biofuels – Role of Bio Technology • Agronomy • Plantation in irrigated, rain fed conditions • Cultivation with intercrops • Hybrid development • Plant Tissue Culture • Leaf disc regeneration • Immature embryo transformation • Plant Metabolic Engineering • Transgenic Jatropha • Bio-Process Technology • Fermentation • Enzyme manufacturing • By-product value addition • Yeast to oil Biofuels can bring about rural transformation through higher farm incomes and better quality of life.

22. Contents 1. Indian Biofuels Context 2. Biofuels Development Challenges 3. Reliance Biofuels Initiative 4. Summary

23. Biofuels Architecture Elite Plants Characterisation And Sourcing Tissue Cultured Plants Hybrid Plants Development Jatropha Farming Cellulosic Biomass Transgenic Plants Development Jatropha Seeds Protein Extraction Jatropha Oil Jatropha Seed Cake Glycerol Enzyme directed conversion Transesterification 3GT Biopolymer Via 1,3 Propane Diol Biodiesel Bioethanol Biobutanol The biofuels initiative of Reliance group is unique in its architecture and content.

24. Reliance Business Design Principles • Philosophy • Energy security • Rural transformation opportunity • Focus area • Biodiesel • Crops • Non-edible seeds • Non-compete with alcohol • Agronomy • Work with marginal farmers • Focus on rain-fed areas • No RIL land ownership • Technology • For higher farm yields • For higher oil content • Pursue competing technologies Hybrid variety of Jatropha with intercrop Business design is based on biodiesel non-edible crops on cultivable wasteland owned by marginal farmers.

25. Components (1) • Agronomy • R&D (Kakinada, Nagothane, Gandhar) • Plantation (Jatropha, Simarouba, Pongamia) • Jatropha cultivation with intercrops (Pulses, Millets, beans, oil seeds, vegetables) • Jatropha hybrid development • Farm Advocacy • Scale-up of biofuel crops • Five states in India (Andhra Pradesh, Maharashtra, Madhya Pradesh, Gujarat, Chhatisgarh) • NGO partners • Multiple points of engagement The agronomy and farm advocacy components focus on the farm to address productivity, incomes and scale.

26. Components (2) • Plant Metabolic Engineering • High expression of oils in Jatropha • Algal cultures • Plant Tissue Culture • Transesterification • Pilot plant at Kakinada for feed stock validation and engine performance. • Industrial Biotechnology • Glycerol to 1,3 propanediol to polymer • Oil expression in yeast • Biomass to bioethanol/biobutanol • Enzymology • Enzymes for bioethanol/biobutanol Plant and industrial biotechnology components focus on technology to address yields, costs and value addition.

27. Contents 1. Indian Biofuels context 2. Biofuels Development Challenges 3. Reliance Biofuels Initiative 4. Summary

28. Summary • India Biofuels Imperative • US$ 1 trillion + economy • 1 billion + people • Seriously energy deficient • India Biofuels Endowment • Arable land (142 mill Ha) • Cultivable waste land (40 mill Ha) • Cost advantage • Biotech talent • India Biofuels Opportunity • Higher farm incomes • Better quality of rural life • Jatropha biodiesel and Sugar cane bioethanol are sustainable • Challenges • Costs and Competitiveness Biofuels is an imperative for India for energy security and an opportunity for rural transformation.

29. Thank You