Brazil’s ethanol industry and its unique journey to large-scale biofuel production

RIO DE JANEIRO, BRAZIL – Brazil has spearheaded some of the paradigm shifts in biofuels, especially bioethanol, long before they became an urgent necessity due to climate change. Biofuels have been part of Brazil’s national energy policies for almost half a century. As a result, the country’s experience in creating an ethanol economy has the potential to help others develop their strategies and select the best paths to adopt to integrate ethanol into the fuel economy successfully.

Large-scale biofuel production in Brazil began in 1975 in response to the first oil crisis when the Brazilian government decided to launch the “Pro alcohol” program to encourage the development of an indigenous ethanol-based transportation industry that would mitigate the country’s dependence on fossil fuels, generate jobs and foster technological development. In 1975, Brazil was still importing 70% of its oil consumption.

Incremental regulation for ethanol blending in gasoline, now mandated at 27%, paved the way for greater consumer acceptance and inclination for the fuel. Since 1975, ethanol production in Brazil has grown 45-fold thanks to extensive research by the Brazilian Agricultural Research Corporation (EMBRAPA) to improve sugarcane productivity, while the price has been reduced by 70%.

Brazil also has the world’s largest transportation matrix decarbonization program, RenovaBio, in place since 2019 and is expected to further increase ethanol supply by 45 % by 2030, reaching a production of 50 billion liters. Today, as ethanol is transforming the future of fuel, Brazil’s Raízen is already supplying second-generation ethanol to the Ferrari Formula 1 team starting this year (10% blend), and Embraer is developing an ethanol blend to provide a sustainable aviation fuel.

The ethanol economy received renewed impetus from the affordable and simple technological novelty of the “flex engine” introduced in Brazil after 2003, which allows the same vehicle to be powered by 100% ethanol, gasoline, or any intermediate blend of the two. Brazil is one of the largest producers of automobiles, with more than 3.1 million cars per year. With almost two decades of experience in flex-fuel vehicles, 93% of cars in Brazil today come with a flex-fuel engine. Imported cars are adapted to run on an E27 blend with minor engine modifications at prices as low as US$50.

Along with foreign exchange savings to the tune of US$261 billion, Brazil’s ethanol program has also avoided more than 1.34 billion tons of CO2 equivalent emissions, leading to a 50% reduction in air pollution and improved public health in major cities such as São Paulo.

While the benefits of using ethanol in the transportation fuel matrix are multiple, ethanol production also provides a low-cost, low-tech pathway to sustainable development for developing countries through the simultaneous production of bioelectricity, biogas, biomethane, and biofertilizers from what is essentially considered agricultural “waste” to produce ethanol.

Sugarcane bioelectricity supplied to Brazil’s national electricity grid in 2020 accounted for more than 5% of the country’s energy consumption, enough to supply more than 10 million homes per year. Similarly, bioethanol can also provide a cleaner cooking fuel alternative in rural areas.

In an effort to green the transportation sector, there is a growing trend towards vehicle electrification, which is often mistakenly referred to as synonymous with one of its options: battery electric vehicles (BEVs). However, ethanol is also an effective solution for electric vehicles. Solid oxide fuel cell technology, which converts ethanol into electricity to power vehicles, has proven to be much more energy-efficient and environmentally friendly than battery electric vehicles.

Sugarcane ethanol has a higher energy density than batteries, and greenhouse gas (GHG) emissions are significantly lower considering the entire energy cycle. For example, in Brazil, current flexible internal combustion engines using ethanol emit 58 grams of CO2 per kilometer. BEVs using electricity, which is 83% renewable in Brazil, emit 65 grams. In comparison, hybrid electric vehicles using ethanol, which is already on the Brazilian market, emit 29 grams of CO2 per kilometer.

We know that the energy transition through biofuels is an excellent opportunity to create and modernize industries, drive technological innovation, attract investment and generate high-quality jobs while contributing to sustainable development and the quality of life of future generations worldwide.