Energy Independence, the Brazilian Example

By Jeff Bennett

Ethanol is transforming Brazil from an iconic nation with alluring beaches and a glamorous nightlife to a trend setting pioneer in its pursuit for energy independence. Currently various nations hungry for their own sovereign energy sources, like the United States, look toward Brazil in hopes of replicating its success in creation of a future less-reliant on oil-based energies.

It helps Brazil is the world’s top-grower of sugar cane, a crop grown naturally in coastal wet-dry climates and used to produce ethanol from its sucrose. Because of this, the industry liberates drivers from only relying on gasoline at the pumps, displacing nearly half of its national gas consumption.

More than 33,000 filling stations offer drivers the option of filling up on ethanol, a fuel source cheaper than gasoline, said Adehamr Altieri, communication director in Sao Paulo for UNICA, The Brazilian Sugarcane Industry Association.

“Many citizens … choose ethanol over gasoline because it saves them money,” Altieri said.

In Brazil’s southernmost state of Rio Grande do Sul, Pastor Daniel Lima drives a gasoline powered car the filling station and is sometimes envious of the price disparity between ethanol and gas. “Ethanol prices are roughly 60 percent of gas prices,” Lima said. Or, according to the National Petroleum Agency, a liter of ethanol costs about 63 cents, in U.S. dollars, while a liter of gasoline is around 1.07 USD.

Lima is unable to capitalize on ethanol’s price break. He does not drive one of the innovative cars made by the Brazilian automobile industry, which is tailored to the driver’s preference between the two fuel sources.

“Here, we had the car that ran completely from ethanol and the one … that drives on gasoline,” said Ramon Antunes, a student at Uni business college in Belo Horizonte within the state of Minas Gerais – one of the nation’s top-three ethanol producing states.

Interestingly, Antunes said the ethanol car is no longer in production and was replaced by the flex-fuel car, a vehicle that can run on either ethanol, gasoline or a mixture of both, but typically ethanol since it is always cheaper.

“Flex-fuel cars are O.K.,” he said. “My friends like them because if they don’t have much money in the pockets, they can fill up on the cheaper ethanol or a mixture. They are made by Fiat, Volkswagen, Honda, Ford and are just like any other car but a little more expensive.”

Brazilian industry experts are optimistic the reliable flex-fuel automobile will boost ethanol sales in promotion of their energy independence. To facilitate this cause, Altieri says the Brazilian motorists drove 4.5 million flex-fuel vehicles on the roadways, which was roughly 20 percent of all light automobiles in 2007. He also expects these numbers to grow to around 10 million in 2010.

The option to select between ethanol and gasoline in Brazil has stirred envy in some U.S. motorists who clamor for alternative fuels other than gasoline. However, previous Brazilian examples show that ethanol is far from a perfect solution.

“In the first few years cars that ran on ethanol became famous for some problems, especially starting in cold mornings,” Lima said. “I know that this has changed as the technology was further developed, but there is an image that still lingers that an ethanol car is not as reliable as a gas car.”

Since ethanol burns at a higher temperature than gasoline, it makes cars that run entirely on the fuel hard to start during cool weather mornings particularly in states like Rio Grande do Sol. The defect became apparent in the early 1980s when the car was quickly subsidized by the government in promotion of its sales. The subsidy helped create a high demand for the vehicle, which in turn boosted ethanol sales, said Sarah Faria, another student at Uni business college.

“There was an ethanol shortage in the 1980s” when ethanol producers could not meet domestic demand for the fuel source, said Faria. Since then “Brazilians are not as comfortable relying only on ethanol.”

The vehicle was also less fuel efficient.

“Ethanol cars tend to get roughly 10 percent less mileage than a gasoline car,” said Lima. This is a caveat to why he believes the ethanol car never reached a market share of 50 percent in Brazil and today is seldom seen on the roadways.

According to Antunes, the Brazilian automakers discontinued production of the ethanol cars and began production of the trendy and popular flex-fuel automobile around 2002.

Like Brazil, U.S. car makers are incorporating the flex-fuel vehicle into their market to utilize America’s version of ethanol, E85, a corn-based mixture composed of 85 percent ethanol and 15 percent gasoline. Similar to the Brazilian eagerness to decrease gasoline consumption, U.S. consumers are zealously purchasing flex-fuel automobiles.

According to the Center for American Progress, more than 4.4 million flex-fuel vehicles traversed U.S. roads, almost equaling Brazilian totals. Yet, still in its ethanol infancy, the U.S. has not duplicated Brazil’s achievements to make ethanol readily available for driver consumption.

According to the U.S. Department of Energy, around 1,600 out of more than 170,000 gas stations offered E85 to American drivers in 2008. Nonetheless, as Brazilian drivers save hundreds of dollars filling their tanks with ethanol, they are thankful for its abundant presence in their nation.

“I think right now in Brazil it’s a big thing to have a flex-fuel car and the choice to use ethanol with the changing oil barrel prices,” Antunes said.

###