United
States and Brazil Strengthen their Biofuels Partnership
By Carl Wolf, BCS, Incorporated
On March 9, 2007, Brazilian Foreign Minister Celso Amorim and U.S. Secretary of State Condeleeza Rice signed a memorandum
of understanding advancing the cooperation on biofuels between the two
countries. [i]The
agreement features the importance of biofuels as a transformative force in the Western Hemisphere to diversify energy supplies, promote economic prosperity, improve
sustainable development of biofuels, and protect the environment.
The United States and Brazil intend to work with the International Biofuels Forum to examine development of common
biofuels standards and codes to facilitate a universal understanding of the
energy source. The U.S. and Brazil are attempting to implement a biofuels
initiative that will first bring the America’s to a common understanding on
biofuels, and eventually the globe. This bilateral cooperation will reduce
dependency on fossil fuels, lower greenhouse gases, and encourages prosperity
within the region.
In addition, The National Institute for
Standards and Technology held a workshop September 14-15 2006 between the United States and Brazil titled
Measurements and Standards for Biofuels: Enabling a Transition from Petroleum as a Vehicular
Energy Source. [ii]The goal of the
workshop was to establish a collaborative program regarding the standards and
metrology of biofuels. The workshop consisted of three sessions: using the
experience and expertise from the fossil fuels and hydrogen academia and
applying it to biofuel research and development, using
molecular and structural biology for biofuel research; and creating an “ethanol
cluster” among major ethanol producers. This would integrate all aspects of
ethanol production and allow the sharing of information and development much
easier and efficient. The overlying factor is that in order to best utilize
information on the subject cooperation, especially regarding the metrology and
standards of biofuels is essential.
Brazil has been at the forefront of renewable energy production for many
years since the oil crisis of the 1970’s, which saw soaring oil prices. Brazil set goals to reduce their dependence on oil from the Middle East. In 1975 Brazil began its alternative energy campaign which focused on converting sugarcane into ethanol.
While most U.S. ethanol is corn based, Brazil favors sugarcane because of its
arable land and positive climate. [iii]This
transition initially saw Brazil struggle to develop efficient technology for
its domestic energy needs, though recently have experienced enormous success
not only on the domestic level but also internationally. They recently have
developed the technology for flex fuel cars that can run on gasoline, ethanol,
or any combination of the two. Flex fuel cars were first produced in Brazil in 2003 and already represent 70 percent of new passenger car sales. While Brazilian
drivers currently consume 83 percent of the countries total ethanol production,
the exportation of ethanol has been steadily increasing in recent years. With
the adaptation of blending mandates all over the world, the country will most
likely see an increase in foreign investment. Brazil is the world’s largest
exporter of ethanol and with the U.S. their largest market for ethanol exports,
the cooperation between the two on the issues.
On March 2nd 2007, the International Biofuels Forum was launched. The forum, which
falls under the United Nations, is a major step to encouraging cooperation,
global development and the use of biofuels. Members include the United States, Brazil, the European Union, China, India, and South Africa. Brazil’s Foreign Ministry has been organizing the creation of this forum for over a year and seems
very pleased at the way it has come together. [iv]"Today, if you talk
about biofuels, it is classified as an agricultural product, not an energy
product," said a Brazil Foreign Ministry spokesman, "But one of the
main objectives of forming this group of nations is to change this
concept." The forum was created under the notion that the rising oil prices
are causing a need for international cooperation in regards to renewable
energy. While this is likely to benefit the major exporters of ethanol, like Brazil, the forum intends to aid developing countries in utilizing biofuel technology as
well. [v]"There
will be two groups created by the forum," said the spokesman.
"The first will be a group that exchanges information and experiences
about biofuels, while the second will be a more technical work group that will
discuss the standardization of different types of biofuel to establish a common
norm.”
In Decemeber 2006, Jeb Bush, former
Governor of Florida; Roberto Rodrigues, President of the Superior Council of
Agribusiness and Former Minister of Agriculture of Brazil; and Luis Alberto
Moreno, President of the Inter-American Development Bank (IDB) joined together
to establish the Interamerican Ethanol Commission. The Commission’s goal is to
promote the usage of ethanol in the gasoline pools of the Americas. [vi]
[vii]The
organization will act as an ethanol think tank and provide valuable information
to the region regarding its research and development while also traveling abroad
giving presentations regarding ethanol in an attempt to raise public awareness
of the technology. [viii]
Japan is expected to soon pass legislation that will require its
gasoline to contain at least three percent ethanol; consequently, a much larger
supply will be needed. As a result, they are engaging in negotiations with Brazil regarding the logistics of such a trade agreement. Reports say a deal supplying
these Japanese markets could cost up to $8 billion. In addition, new EU policy
requires member countries to acquire 20 percent of its energy from renewable
energy sources could also mean an increase in Brazil’s ethanol exports. [ix]Brazil is not only the lowest-cost producer of ethanol in the world, but also one of the
few countries having significant quantities of land available for agricultural
expansion. With these emerging markets and vast resources, Brazil will have to have to raise its level of production to meet market demand. Government
officials stated that they are planning to double their export of ethanol to
about four billion liters within the next five years. Brazil’s Finance Minister, Guido
Mantega, has long been pushing for the further exportation of ethanol. In
regards to the subject, he claimed that [x]“it's
possible to give more importance to ethanol. We can develop joint projects in
such a way that we can introduce these alternative energy sources into regular
consumption.”
U.S. Department of State Fact Sheet. March 9, 2007. http://www.state.gov/r/pa/prs/ps/2007/mar/81589.htm
[ii] http://www.nist.gov/oiaa/biofuels.htm
[iii] David J.
Lynch. “Brazil Hopes to Build on its Ethanol Success”. March 28,
2006. USA Today. http://www.usatoday.com/money/world/2006-03-28-brazil-ethanol-cover_x.htm
[iv] Grace Fan. “Brazil, US, Others Launch International Biofuels Forum Friday.”
Dow Jones Newswires. March 1, 2007. http://www.cattlenetwork.com/content.asp?contentid=110157
[v] Grace Fan. “Brazil, US, Others Launch International Biofuels
Forum Friday.”
Dow Jones Newswires. March 1, 2007. http://www.cattlenetwork.com/content.asp?contentid=110157
[vi] “Florida, Brazil, And IDB To Launch Interamerican Ethanol Commission” December 18, 2006. http://helpfuelthefuture.org/mediaroom-pressrelease-dec18-english.htm
[vii] Vanessa
Bauzá. “Florida may be center of Brazil-U.S. alliance on ethanol.” South
Florida Sun-Sentine. March 9,
2007. http://www.sun-sentinel.com/business/local/sfl-aethanol09mar09,0,2928692.story?track=rss
[viii] Bill
Belew. “Japan-Brazil
Ethanol Investment Could Reach $8 billion.”March 5, 2007. http://www.risingsunofnihon.com/2007/03/japanbrazil_ethanol_investment.html
[ix] Grace Fan. “Brazil, US, Others Launch International Biofuels
Forum Friday.”
Dow Jones Newswires. March 1, 2007. http://www.cattlenetwork.com/content.asp?contentid=110157
[x] “Brazil to Double Ethanol Exports.” February 5, 2007. http://asia.news.yahoo.com/070205/3/2wx3y.html