IB 403, Section 003
Biofuel is one of the newest and largest trends sweeping the world. Gaining interest in countries and economies, governments have announced strong commitments to biofuel programs in order to reduce greenhouse gas emissions and diversify energy sources. Although these programs are new to many countries, Brazil has years of experience with sugarcane-based ethanol, creating a success story for others to reference. Currently, Brazil is the largest biofuel market with the United States ringing in a close second. However, Brazil’s ethanol is created from sugarcane while the U.S. uses corn to produce their ethanol. Not only is Brazil’s sugarcane-based ethanol the first renewable fuel to be cost-competitive with transportation fuel, but it is also the most economical compared to its competitors. The ethanol’s efficiency is due to the power of the sugarcane compared to corn as an ethanol feedstock, a perfect climate for sugarcane harvesting, and the large, unskilled, inexpensive labor force in Brazil. In addition, the U.S. uses almost double the amount of land to farm corn to produce ethanol as Brazil uses to harvest sugarcane to produce almost the same volume as ethanol.
What is Ethanol?
Ethanol is an alcohol fuel distilled from plant materials, such as corn and sugar. Ethanol is the main biofuel for transportation and Brazil is the greatest exporter globally of bioethanol. The sugar and ethanol industry in Brazil make up 2.3% of the Domestic Gross Product, generating 4.5 million jobs for Brazilian citizens. Not only is ethanol responsible for 50% of fuel volume consumed by cars and light vehicles, but it also represents 90% of gasohol, a blend combined with gasoline, used by many oil companies. Brazil consumes 31% of global ethanol consumption, of which 96% is used for fuel and the other 4% for industrial use.
History of Brazil’s Ethanol Program:
Beginning in the 20th century, Brazil started using ethanol for energy purposes. 1905 gathered government attention as the first tests were conducted to use ethanol as fuel for vehicle engines. Shortly thereafter, a law was inducted in 1931 requiring ethanol to be mixed with gasoline at a rate of 5%. Almost 100 years ago we can look at one of the first blends of gasoline and ethanol that is still in use today! The 1970’s represented a decade of struggle and obstacles for Brazil, only to be triumphed with new technology, programs, and investments. Due to the Arab oil embargo in 1973, oil import costs tripled for Brazil. 1974 provided a drastic change when world sugar prices finally decreased following a 10-year steady rise in price. These two extreme changes in the global market paved the way for a new program to take the lead in ethanol fuel production and reduce their dependency on oil imports. The Brazilian National Alcohol Program (PROALCOOL) was launched in 1975 to create a large-scale ethanol generation for distilleries and engines to adapt and consume pure ethanol or the E20 Blend (20% ethanol and 80% gasoline). PROALCOOL has provided Brazil with an agricultural price support program and an energy security program. The agricultural price support program wanted to give Brazil a guarantee that profits from sugarcane and the sugar industry would not fall as they did in 1974. The energy security program directed their attention to increasing the production of sugarcane alcohol to be used as a substitution for gasoline. The excess production of sugar would be taken to special distilleries close to the sugar mill to be converted into ethanol, which would then be blended with gasoline. PROALCOOL’s first phase was to increase the number of distilleries within the existing sugar mills in Brazil. Their plan was for the federal government to aid them in the construction of new refineries by offering low-interest