*

Wartsila says running an engine on ethanol will provide

needed

flexibility

*

Earlier successful tests for ethanol power in Brazil

failed to

advance further

By Oliver Griffin

SAO PAULO, May 29 (Reuters) - Finland's Wartsila

is betting that a more nimble way to generate power

with ethanol will prove viable in Brazil where similar efforts

by major firms floundered a decade ago.

Wartsila announced a partnership in March with a power plant

in the northeast Brazilian city of Recife, where a four-megawatt

engine will burn ethanol for 4,000 hours during a two-year pilot

starting in April 2026.

The Finnish company billed its efforts as a world-first

trial in generating electricity with an ethanol-powered engine.

But similar experiments by Brazilian corporate heavyweights

Petrobras and Vale sputtered out amid high

costs and low uptake, according to people who worked on those

projects.

Brazil is the world's second-largest producer of ethanol,

after the United States, producing the biofuel largely from

sugarcane and increasingly from corn. Brazil has used ethanol to

power cars for decades, leading to volatile prices affected by

sugar and petroleum markets.

In 2010, Petrobras teamed up with General Electric, before

the U.S. manufacturer split into three separate public

companies, to convert a gas turbine at the state-run oil

producer's power plant in Juiz De Fora to run on ethanol.

"Ethanol was very sexy, everyone gets very hyped about it,"

a person with knowledge of the project told Reuters on condition

of anonymity. The plant returned to running on natural gas

shortly after the 1,000-hour test was completed, as higher costs

made ethanol untenable as a fuel in the long run, the person

added.

Petrobras confirmed the turbine in Juiz De Fora now runs on

natural gas.

Vale Solucoes em Energia (VSE), a startup majority-owned by

the mining giant, invested some $600 million in clean energy,

including ethanol-powered electricity, VSE's former Chief

Executive James Pessoa said in an interview.

VSE built smaller ethanol-based generators for electricity

which were used in Rio de Janeiro and Amazonas state, Pessoa

said, adding that another was built at Brazil's Antarctic

research station.

VSE was shuttered by 2013. Pessoa said he had not seen any

further development since then of ethanol-powered generators

like those produced by VSE.

"The technology exists," he said, adding that Brazil could

have millions of heavy ethanol engines powering the country.

"But in practical terms, there are zero (in operation)."

Wartsila plans to test ethanol as a fuel for one of its 32M

engines, which is larger than the VSE generators but far smaller

than the plant converted by Petrobras, seeking efficiency at a

more flexible scale.

While running a turbine on ethanol 24-7 is more costly than

natural gas, those plants cannot provide the flexibility needed

by a grid like Brazil's, which is mostly powered by renewables,

Jorge Alcaide, Wartsila's managing director in Brazil and head

of its energy business in the southern America region, said in

an interview.

The engine will "follow the wind" and start up quickly when

renewable sources like wind and solar fall off, said Alcaide.

Wartsila declined to reveal its spending on the pilot.

"Thermal power plants in Brazil should be used in the

standby model," he said. "We need thermal to be available, it's

like insurance."