The Raizen Group is a $12 billion joint venture between Royal Dutch Shell and Cosan, and produces 2.2 billion liters of ethanol and 4 million tons of sugar annually, and has installed power generating capacity of 900 MW of electric energy derived from sugar cane bagasse. After conducting a thorough investigation of cellulosic technologies, Raizen concluded that Iogen has the most advanced technology suitable for the commercialization of cellulosic ethanol. Raizen will cover development and engineering costs associated with the creation of a biomass-to-ethanol facility to be located in Piracicaba, Sao Paulo, Brazil which will use Iogen’s cellulosic technology to create ethanol. After years of production of first generation ethanol in Brazil, focus is shifting to cellulosic biofuels because of high sugar prices. The Brazilian government has acquired substantial regulatory control over biofuels and wants to ensure that ethanol markets do not fall under the control of food markets.