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Case Study Detail Record
     


Organization type:  Major Groups
   
Submitting organization: 
   
Affiliation: - Farmers

   
Initiative Title: Bioethanol in Brazil
   
Internet links:
   
Scope: National:
- Brazil
   
Status: Ongoing
   
Timeframe:
Start:     End:
   
Stakeholders/Partners:  Brazilian government, Brazilian people, consumers, sugar farmers, ethanol producers, flexi-fuel/bioethanol fuelled car manufacturers and retailers
   
Relevent issues: - Control measures derived from the Montreal Protocol

- Phasing out leaded gasoline

- R and D in cleaner fuels and air pollution abatement technologies

- Reducing health risks from air pollutants

- Advanced energy technologies

- Consumer education and awareness-raising

- Fuel efficiency and cleaner fuel for transportation

- Renewable energy including hydro power

Objectives/Challenges:
In Brazil, bioethanol has been used as a commercial liquid fuel for many years, with the Government being the first to initiate the promotion of bioethanol through the PROALCOHOL Programme in the 70s. The federal government, through subsidies to farmers and maintenance of low prices aimed to absorb the constant surplus in energy production and prevent dependence on foreign oil imports. In the last two years, with rising oil prices and search for cleaner and renewable energies, the government has re-focused on bioethanol and flexi-fuel cars, which can be powered by both conventional fuel and ethanol or a blend in any combination. Consumers can power their cars at regular stations from ethanol, blended fuel and ethanol or regular fuel, but with the rise of oil prices conventional fuel is losing market share. In May-June 2005, flexi-fuel vehicle sales in Brazil overtook sales of gasoline cars for the first time.
 
Lessons Learned:
• Consumers will choose bioethanol and flexifuel cars at competitive prices if they are readily available. The government should hence ensure through subsidies competitive prices for biofuels and bioethanol and ensure its availability through the normal distribution chain.

 
Policy Options:
• Promote the use of bioethanol and flex-fuel cars
• Ensure that flexi-fuel cars are affordable
• Ensure that bioethanol and biofuels are available at regular petrol stations
• Subsidize the price of bioethanol to make it attractive to consumers
• Promote the production of sugar through subsidies
• Promote the production of bioethanol through industry subsidies or incentives
 
Summary:
In Brazil, bioethanol has been used as a commercial liquid fuel for many years, with the Government being the first to initiate the promotion of bioethanol through the PROALCOHOL Programme in the 70s. The federal government, through subsidies to farmers and maintenance of low prices aimed to absorb the constant surplus in energy production and prevent dependence on foreign oil imports. In the last two years, with rising oil prices and search for cleaner and renewable energies, the government has re-focused on bioethanol and flexi-fuel cars, which can be powered by both conventional fuel and ethanol or a blend in any combination. Consumers can power their cars at regular stations from ethanol, blended fuel and ethanol or regular fuel, but with the rise of oil prices conventional fuel is losing market share. In May-June 2005, flexi-fuel vehicle sales in Brazil overtook sales of gasoline cars for the first time.
     

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