Despite the global economy reeling this year from the devastating fallout on the energy sector and aftermath of the Covind-19 pandemic, the world is looking forward to transit to an ambitious biofuel program after witnessing the success story of Brazilian ethanol. However, countries aiming to produce biofuel are yet trying to solve the equation led by the required policy making stakeholders and the contributors of manufacturers.
In a conversation with ChiniMandi News, Mr. Amaury Pekelman – CEO, União Nacional da Bioenergia (UDOP) – [National Union of Bioenergy, Brazil] shared his views on the Global Outlook of Ethanol.
He said, the global ethanol market is a booming market, mainly in Asia. However, it should also be encouraged by more countries due to its positive environmental externalities, as well as its excellent CO2 reduction, which allows, for example, a significant decrease in the emission of particulate matter, for instance, in a metropolis such as Sao Paulo where, according to data from IBGE (Brazilian Institute of Geography and Statistics), the vehicle fleet reaches almost 20 million vehicles, or, 7.4 vehicles for every 10 inhabitants.
Data obtained from sector entities show that between March 2003 (launch date of the flex fuel technology) and May 2020, the consumption of ethanol (anhydrous and hydrated) prevented the emission of over 515 million tons of CO2eq in Brazil. The volume is equivalent to the combined annual emissions of Argentina, Venezuela, Chile, Colombia, Uruguay and Paraguay.
“Not even the new worldwide trend for electric vehicles represents a threat to our ethanol since it is a clean and safe source for a technology which is still expanding, the so-called hybrid electrical vehicles, where energy is generated through ethanol, without greenhouse gas emissions.
That’s why we believe that there should be higher investments in the development of new technologies based on ethanol, thus improving the quality of life in large cities, in addition to the secondary and not less important benefits such as generation of jobs and income in rural areas, which in Brazil is where the plants / distilleries are allocated.”
Sharing about a pertinent item that could be highlighted referring to the National Biofuels Policy (RenovaBio), he shared “(RenovaBio) implemented in Brazil in 2019, which allowed us to create a new market that prices the carbon footprint, the so called CBIOS (Decarbonization Credits), which take into account how environmentally responsible each plant is, which can even improve its energy performance and its emission of CBIOs.
The CBIOs market is currently traded in the stock exchange, with agents obliged to purchase (fuel distributors, through goals established by competent bodies) and not obliged (any private individual who is interested in these stocks).
This evolution is very important for the growth and development of the industry, which is recognized for its environmental externality, being remunerated for that through an effective decarbonization program of the Brazilian transport matrix.”
Ethanol is an accessible fuel with environmental and economic benefits. The Indian sugar industry can play an important role in the production of ethanol. On being asked his opinion as to how India can replicate Brazil’s success history in ethanol, Pekelman answered “We strongly believe in the Indian potential for large-scale production of ethanol, which would greatly promote the inclusion of this biofuel as a global commodity. India has already understood those benefits and has been increasing its ethanol production year after year.
Data from the Consulting company Datagro, one of the most important consulting companies on this subject in the world, and whose UDOP is honored to be a partner, show that the production of ethanol in India jumped from 2.06 billion liters in the 16/17 harvest to over 3 billion in the current season. These numbers represent almost 9% of the domestic gasoline market.
But we believe that public policies, such as the existing policies in Brazil, of mandatory mixture of ethanol in gasoline consumed in India, could further favor the sector in this country. Brazil is today one of the largest consumers of ethanol in the world precisely because it has 27% of ethanol mixed in the composition of its gasoline, in addition to the growing market of vehicles with flex fuel technology that allows consumers to choose which fuel they want to use when refueling.
This requires extensive investments in logistics, mixture and distribution at the gas stations, but it would be very beneficial to the entire Indian sugarcane-energy chain.”
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