Raízen formalizes investment of R$ 11,5 billion for the construction of E2G plants

A global leader in bioenergy, Raízen participated in the signing ceremony of the Fuel of the Future Law (Bill 528/202), an important step towards decarbonizing the transportation and mobility matrix, driving the country forward in the energy transition agenda. Celebrating the milestone, Ricardo Mussa, the company's CEO and leader of the B20 Brazil energy transition and climate task force, was alongside President Luiz Inácio Lula da Silva and the Minister of Mines and Energy (MME), Alexandre Silveira, to sign a letter reinforcing the company's intention and commitment to maintain investments in the country with projects for renewable energy sources.

The Fuel of the Future opens a new phase for the decarbonization of the mobility and transportation sectors, highlighting Brazil on the global stage as a hotbed of more sustainable solutions. The law will boost the research, production, commercialization and use of green diesel, sustainable aviation fuel (SAF) and biomethane. Aligned with the new regulation, Raízen seeks low-carbon solutions in bioproducts and advanced biofuels that play a leading role in the energy transition, working together to achieve the decarbonization goals set out in national policies.

“Brazil has all the tools to be a leader and an example in the energy transition for the world. With the Fuel of the Future, we gain more strength and incentive to decarbonize our fleets, positively impacting all economic and social sectors. We reinforce our commitment to invest R$11,5 billion in the construction of Second Generation Ethanol and biomethane plants to meet the increased demand,” celebrates Ricardo Mussa. “We will also see the development of new technologies for increasingly sustainable solutions, respecting the protection of the environment and food production, with fewer pollutant emissions and meeting an urgent demand for cleaner energy,” says the CEO, who also led the group formed by executives, experts and representatives of civil society to discuss paths, debate and define recommendations, practical actions and metrics that will be presented to the G20 leaders in November.

One of the main global players in the ethanol sector, Raízen believes that the new rule will play an important role in the development of the market and in the creation of new technologies, such as Second Generation Ethanol (E2G), a product that has already proven to be economically viable, with long-term marketing contracts. Produced using proprietary technology and sugarcane bagasse as an input, this advanced biofuel has the potential to increase ethanol production capacity by approximately 50%, without the need to increase the planting area. In addition, its production results in a molecule with significant reduction in CO2 emissions, being 30% more sustainable than regular ethanol. E2G can be used in several applications, in addition to mobility, as a raw material for the chemical and beverage industries, for example.

Raízen is the only company in the world with industrial-scale production of E2G, with 36 million liters produced in the 2023-2024 harvest, driving the energy transition with innovative and sustainable solutions. With two E2G plants in the interior of São Paulo, the company has seven units under construction or under design, all with production sold under long-term contracts equivalent to more than EUR 4 billion, and with an installed production capacity of 686 million liters of ethanol per year.

As with first-generation ethanol, E2G processing produces byproducts for the development of new solutions, including, for example, vinasse, used in the production of biogas, and lignin, which is fed to boilers for power generation and used in studies for its conversion into advanced biofuels for the maritime and aviation sectors, chemical products and materials. With the mission of developing decarbonization solutions from sugarcane, Raízen, in partnership with Shell and SENAI-SP, is investing approximately R$120 million in the construction of the Bioenergy Center in Piracicaba (SP), which will bring technological advances for the production of biofuels with a lower carbon footprint. The modern set of laboratories and pilot plants will focus, in the first five years, on research into efficiency and sustainability gains in the E2G production process.

The new law also stipulates emission reduction targets for airline operators starting in 2027, who must have aircraft fueled with SAF, a fuel produced from renewable raw materials. Developing effective and scalable solutions for sectors that are difficult to decarbonize, Raízen was the first ethanol player in the world to receive the ISCC Corsia Plus (Carbon Offsetting and Reduction Scheme for International Aviation) certification, which proves that the ethanol produced at the Costa Pinto bioenergy park meets international requirements for the production of sustainable aviation fuel, following the standards of the International Civil Aviation Organization (ICAO). The Gasa bioenergy park was subsequently also certified.

In addition to introducing products with high added sustainability value to the market, Raízen's investments in new E2G and biomethane plants will have a positive impact on the country by generating social and economic benefits. The company's expansions are expected to generate around 12 direct and indirect jobs, impact more than 500 suppliers and companies, and increase the representation of the municipalities in which they operate in the state participation fund, encouraging shared growth, the development of national suppliers, the production of nationally sourced equipment, and the technical training of local labor.

With positive public policies such as the Fuel of the Future, Brazil is positioning itself as a leader towards a greener and more inclusive future. With the new law, Raízen further reinforces its commitment to innovation and sustainability based on the energy potential of sugarcane, capable of generating effective solutions for the global energy transition.