Trinidad Guardian
Thursday 8th March, 2007
Brazil, US to discuss an ‘Opec’ for ethanolThe US, which produces mainly corn-based ethanol, just recently pulled ahead of Brazil, which uses sugarcane, as the world’s largest producer of the bio-fuel. The two countries produce 72 per cent of the world’s ethanol.
Rio de Janeiro—Brazil’s home-grown fuel independence is set to be a cornerstone of discussions starting Friday when US President George Walker Bush visits Brazil. Mr Bush and his Brazilian counterpart Luiz Inacio Lula da Silva are expected to sign off on the joint creation of an “Opec” for ethanol, the bio-fuel that has freed Brazil from dependence on imported resources.
The proposed association—to be run along the lines of the oil cartel, Organisation for Petroleum Exporting Countries—is to be the main topic of talks in Sao Paulo, where Mr Bush is beginning a six-day tour of Latin America.
For both leaders, the prospect of expanded ethanol use is politically important for Mr Lula because of the leverage it would give him over the growing hegemony of oil-rich Venezuela, and for Mr Bush as an image correction of his anti-Kyoto policies.
The strategic association would provide for co-operation in bio-fuels in the private sector and aim to exploit third markets, starting with those in Central America.
The long-term goal is to turn ethanol into a global commodity.
The US, which produces mainly corn-based ethanol, just recently pulled ahead of Brazil, which uses sugarcane, as the world’s largest producer of the bio-fuel. The two countries produce 72 per cent of the world’s ethanol.
The joint enterprise represents an unexpected “prize” for a programme that was launched in 1975 with no further ambitions than to reduce Brazilian dependence on imported oil.
At that time, when he took over Brazil’s presidency during a military dictatorship, Ernesto Geisel saw the so-called “Brazilian economic miracle” being buried by the world oil crisis. At that time, Brazil imported more than half the oil it needed.
The programme was initially a success, but then got to the verge of collapse—the engines of cars manufactured in the country showed signs of rapid corrosion due to the use of anhydrous alcohol—and the supply of the product was drastically reduced with no prior notice due to the rise in the international price of sugar.
Further, fiscal incentives granted by the government to alcohol producers favoured mainly the large estates and encouraged large landowners to abandon food crops to cultivate sugarcane.
Despite the problems and the growing distrust of consumers, the programme underwent adaptations which nowadays include the obligatory use of a proportion of ethanol mixed with the petrol that is sold in Brazil. New engines were developed to handle the fuel.
According to physicist and former minister of science and technology Jose Goldemberg, if the South American country had not adopted such measures, it would consume double the amount of gasoline it does today.
With the current production of close to 12 billion litres of ethanol a year, Brazil gives out ten million tonnes of carbon less than it could be giving out. That reduction corresponds to 15 per cent of the country’s carbon emissions,” Mr Goldemberg said.
Three decades after it was launched, the Alcohol Programme has become a star at a time when energy and environmental protection have become central worries for developed countries.
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