Brazil Energy Star in the Southern Cross

Brazil has the world's longest river and its grandest rain forest. Its greatest distinction now, however, may be its latest: becoming energy independent, a feat it achieved in 2006. Brazil is now totally energy independent, in large part because 40 percent of its transportation energy is from ethanol grown and processed right in Brazil.29

Brazil is the world's first biofuels economy. America could be the second.

When a Brazilian driver pulls up to a local fuel station, he or she chooses what fuel to use, gas or ethanol. The flex-fuel cars operate on either one, and the drivers force the suppliers to battle for their business by keeping prices reasonable. In Brazil, the ethanol circle has been closed, the sugarcane growers growing the feed stock, the ethanol refiners brewing ethanol, the auto manufacturers building and selling flex-fuel vehicles, and the service station owners providing billions of liters of ethanol a year to pleased drivers.

Brazil is testament to the practical reality of ethanol. But it took thirty years to obtain such ethanol penetration into its market. We need to learn from Brazil if we are to move more quickly.

As Eduardo Carvalho, the president of UNICA, the Brazilian consortium of ethanol producers, tells it, Brazilian oil companies fought tooth and nail to avoid installing E85 pumps in their stations, since those companies did not control the production of ethanol. Today those same firms are erecting artificial barriers in the United States. Carvalho suggests that until the oil companies are themselves involved in producing ethanol, they will claim that installing the pumps will cause every problem from fuel leakage to gum disease. The lesson from Brazil is clear: Only a mandate of some form will get the pumps into the stations. We do not have the thirty years it took Brazil to use a host of subsidies, tax treatment, and government jawboning to get companies to install E85 pumps.

One hundred percent of Brazilian stations now feature at least one ethanol pump. In the United States, out of 170,000 stations, just 873 have one. This paucity is not surprising since no major oil company has entered the ethanol market in a serious way to date, although in May 2007 BP announced forthcoming investments in ethanol. We cannot wait for the major oil companies to surrender to ethanol, running the risk that they never will. We need to heed the lesson from Brazil and require that Americans be given the freedom of access to E85 pumps.

Brazil has another important lesson for us, about deploying the cars capable of running on E85 ethanol. Brazil increased its percentage of new cars with flex-fuel capability from 4 percent to 70 percent in only three years, simply by mandating that manufacturers make the change.30 It occurred at minimal cost and had maximum impact. We should be able to do the same.

We may have trouble beating Brazil in soccer. We should have no trouble at least tying Brazil in ethanol use.

0 0

Post a comment