Fuel Ethanol in Brazil: Its Use and Prospects

Abstract

Ethanol derived from sugar cane has become an important vehicle fuel in Brazil since the creation in 1975 of the Programa Nacional do Álcool (PROÁLCOOL). Fuel ethanol production costs are generally higher than those of gasoline, but, with government subsidies, the use of anhydrous ethanol mixed with gasoline and of hydrous ethanol in lieu of gasoline has become widespread. The use of ethanol has offered economic and strategic benefits, as it has reduced Brazil's traditional dependence on imported petroleum. However, domestic petroleum production is now rising steadily, and the prospects for fuel ethanol will depend more on its inherent competitiveness and, to some extent, environmental merit than on its strategic importance. It is suggested that significant advances can be made in the efficiency of ethanol production and that for the present it is desirable to persist with sugar cane as the main chemical feedstock. However, crops like manioc and sweet sorghum and also woody biomass offer supplementary or alternative feedstocks, which, in the long term, may be preferable on economic or other grounds and which thus deserve continuing investigation. In general, it is appropriate for Brazil to persist with fuel ethanol as a renewable energy source, while seeking to improve production efficiency.