Ethanol and the Quest for Energy Independence

Recently, the United States has pushed for new energy sources to fuel our transportation sector and the overall economy. Ever since the oil crisis of the 1970s, the country’s dependence on foreign petroleum has been evident. Since then, a growing portion of our energy sector has come from corn ethanol. This growth has mostly been due to policies the US government has implemented over the past 10 years in order to achieve energy independence in a way that is sustainable and environmentally friendly. While the US has only recently started implementing these policies, Brazil has already achieved energy independence through their use of sugar cane ethanol.

Ethanol%20Fuel%20Pump

With the passage of the Energy Policy Act in 2005, all gasoline retailers were mandated to blend 7.5 billion gallons of ethanol made from corn annually by 2012. This was called the Renewable Fuel Standard. Its main purpose was to reduce greenhouse gas emissions, decrease reliance on foreign oil supplies, and create jobs (mostly in the agricultural sector). Two years later, the Energy Independence and Security Act of 2007 was passed which ratcheted up the ethanol mandate to blending 13.2 billion gallons of corn-based ethanol by 2012 and rising to 36 billion gallons by the year 2022.

Corn-usda.gov

Congress sensed the challenge this mandate would pose and proposed the Domestic Alternative Fuels Act in January 2012 which had bipartisan support. This act would allow sources other than corn to be used in ethanol production. This bill received a huge amount of backlash from corn farmers, agribusiness and its stakeholders because the legislation would loosen their foothold in the biofuel industry.

Brazil has come a long way on its journey to energy independence, however it can be seen as somewhat of an anomaly. The US has had some success in using ethanol and biofuels but hasn’t achieved the level of independence Brazil has. This can be attributed to more favorable conditions in Brazil such as vast amounts of fertile land, government policies, and heavy investment in infrastructure.

Agence France-Presse - Getty Images

The main push for Brazil’s energy independence came back in the 1970s when oil prices increased at an unprecedented rate and countries realized how susceptible they were to the swings in the global oil market. Following the crisis, the Brazilian government looked towards other solutions to help the country be less susceptible to the unpredictability of the global oil market. The answer came in the form of a crop that they had already been producing and exporting for decades: sugarcane. In 1975, ProAlcool (Programa Nacional do Álcool) was created by presidential decree. The purpose of this program was to utilize Brazil’s robust sugarcane industry to produce ethanol for the purpose of fueling automobiles.

The first part of this strategy was a mandate that by the year 1980, 3.5 billion liters of ethanol be produced annually. Along with this mandate came a large amount of subsidies to aid farmers in adding ethanol distilleries. This strategy would increase the ethanol supply so it would be widely available across the country. The second piece of their strategy was to forge an agreement with automakers in 1979 to start producing more cars that ran on ethanol. The government in turn launched a robust media campaign to inform the public on the benefits of these new flex-fuel cars.

While the US set some policies in reaction to the global oil crisis, the problem seemed to fade once oil prices stabilized and the American public turned their attention elsewhere. Brazil on the other hand maintained its resolve and implemented policies long after oil prices dropped. From what critics saw as just a short-term boost to Brazil’s sugarcane industry, emerged a comprehensive plan to reach the country’s energy independence goal.

Many parallels can be drawn between the US and Brazil on their quests to achieve energy independence. Even though these two countries are different on many economic, social, and geographical levels, we might be able to gain some insight from their policies and implementation methods in order to reach our goal here in the US.

Sources:

  1. http://www.economist.com/node/21542431
  2. http://www.nytimes.com/2004/12/18/business/worldbusiness/18iht-menergy_ed3_.html?_r=0
  3. http://www.afdc.energy.gov/fuels/ethanol_fuel_basics.html
  4. http://www.theecologist.org/News/news_analysis/1077685/our_sugarcane_is_greener_than_your_corn_brazil_takes_on_us_biofuel_industry.html
  5. http://www.ibtimes.com/how-brazil-turned-ethanol-unique-success-1064308

Pictures:

  1. http://www.planetforward.ca
  2. http://www.usda.gov
  3. Agence France-Presse – Getty Images
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