Abstract

MOSQUERA-ARTAMONOV, José Daniel; MOSQUERA, Julio Cesar  and  ARTAMONOVA, Irina. Financial analysis of ethanol as primary fuel in two sugar mills in Colombia. Rev. P+L [online]. 2016, vol.11, n.1, pp.32-41. ISSN 1909-0455.

Introduction. On this paper, the results of studying the economic benefit obtained by using vehicles -fueled with different ethanol concentrations- for the transportation of the operative, technical, and administrative personnel in two sugar mills, are presented. Data from the production costs of two sugar mills in Colombia were used in the study. Objective. To determine the economic benefit of using a gasoline-methanol mixture in the vehicles used in two sugar mills for the transportation of operational, technical, and administrative personnel. Materials and methods. By the use of a mathematical equation, the variation in the price of the fuel in each mixture of ethanol and gasoline was determined in order to analyze the best price scenario to make the conversion of the cars to the flex fuel system feasible. Such a scenario will have to be tested in the years to come, using the results presented on this paper as a base. Results. The research work demonstrated that the use of ethanol in lower concentrations up to 40 % in the mixture (E40) in modified vehicles with the fuel flex kit installed is financially feasible in Colombia. However, such a conversion can be less or more feasible depending on the ethanol concentration in the mixture. Conclusions. Fuel prices for the producers (sugar mills) are different from those for the final consumers. Therefore, it can be said that the conversion to the flex-fuel is very profitable for the industry, but it is not for transporters and for the people in general. Such a finding means that, under the current production system, the use of mixtures above E40 are not feasible in the Colombian market.

Keywords : internal rate of return; sugar mill; ethanol; gasoline; Colombia.

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