Brazilian ethanol rivals electric cars and becomes a model for India

India wants to replicate in its territory the Brazilian revolution of ethanol as an alternative fuel to fossil fuels. The Asian country went from mixing just 1.5% ethanol to gasoline in 2014 to the current 10% and set a target of reaching 20% ​​in 2025. In Brazil, this mix is ​​currently at 27% and can be increased to 30%, according to a proposal by the Ministry of Mines and Energy that will be debated at the next meeting of the National Council for Energy Policy (CNPE).

In addition to increasing the mixture of ethanol, helping to decarbonize its energy matrix in an initiative dubbed “mini-Brazil”, India also wants to import Tupiniquim technology for flex-fuel cars, which has just completed 20 years here. Flex vehicles were the attraction at the last Indian auto show, in January, with cars, motorcycles and the famous tuk-tuk tricycle running on fuel derived from sugar cane. The Indians elected as a priority during their presidency of the G20, this year, the creation of a Global Biofuels Alliance involving India itself, Brazil, the United States and other interested countries.

“One day I will tell my children and grandchildren. The main Indian agribusiness vehicle says that the sugar industry and sugarcane farmers are developing a mini-Brazil in India, through the ethanol revolution, this makes me proud to be Brazilian”, says Evandro Gussi, president of União da Indústria of Cane Sugar and Bioenergy (Unica), former federal deputy for São Paulo and author of the RenovaBio law, which encourages the use of biofuels in the country.

Ethanol became state policy

“Ethanol policy has become more of a state policy than that of the Bolsonaro government or the Lula government. Automakers such as Toyota, Stellantis, Volkswagen and an important part of academia are focused on this topic. We started to see that Brazil has a great asset, which cannot be thrown away by a fad that someone from the outside wants to implement here”, emphasizes Gussi.

He argues that to create a supply network for electric cars in the country, investments of R$ 1 trillion to R$ 1.5 trillion would be necessary, while the ethanol network is already ready and functioning at more than 40 thousand fuel stations, delivering practically the same performance in terms of decarbonization, in addition to generating jobs and income in more than 1,200 municipalities.

Check below the main points of Gussi’s interview with People’s Gazette. The interview was granted before Petrobras’ decision to abandon the international parity of gasoline prices – which, as has happened in the past, tends to harm the competitiveness of ethanol in the domestic market.

“A study just released by Stellantis – which is a global European company, has brands such as Fiat, Jeep, Peugeot and Citroën – which shows that the vehicle powered by Brazilian ethanol has a lower level of emissions than the electric vehicle of the European average. . Because in Europe there are countries that already have very clean sources, like Norway, but there are countries like Poland and Germany, which make a lot of use of coal, while we have a source of clean electricity generation. And then I ask: what is the cost to society of one and the other?”, asks Gussi.

It is necessary to include in this account, emphasizes the executive, that the ethanol production chain, produced from sugar cane and corn, employs 2.4 million people directly and indirectly. “We have a distribution, logistics and retail system in 100% of the national territory, with an agro-industrial presence in more than 1,200 cities. So I am already delivering this decarbonization at no cost to Brazilian society, and more than that, generating employment and income in over 1,200 municipalities”.

“Only in the sugarcane chain, where there is a plant, the GDP per capita increases by US$ 1,028 per year. And in neighboring municipalities the increase is US$ 324 per year. So, this bioenergy solution delivers decarbonization and it is good for the socioeconomic aspects of Brazil. And I don’t need public resources to deliver this solution”, argues Unica’s president.

Electrification does not increase decarbonization

The ethanol sector says it is not afraid of comparison with the 100% electric car, and, in fact, encourages the comparative analysis of the two solutions. Defenders of renewable energy from sugarcane and corn criticize the tax benefits for importing electric cars, which leave a greater carbon footprint in their life cycle, while ethanol is subject to practically the same taxation as gasoline within the country.

On the other hand, Toyota, Volkswagen and Stellantis are working on the development of hybrid vehicles that combine ethanol and electrification. Volks, for example, in partnership with Unicamp, is testing a car in which ethanol passes through a fuel cell to break down its molecules and extract hydrogen which, in turn, propels the electric motor. A different technology from battery models, which prevail in the Northern Hemisphere.

“Electrification does not improve decarbonization in Brazil, it delivers what we already have, it does not significantly increase. With ethanol, today you can fill up your car at the gas station in four to five minutes. To do something similar with electrification, that is, to have all this availability in Curitiba, Paraná, or Crato, Ceará, the public company EPE calculated that the cost of this infrastructure would vary from US$ 220 billion to US$ 300 billion. That is, Brazilian society would have to be willing to spend something between R$ 1 trillion and R$ 1.5 trillion. The question is: will the Brazilian citizen take this money out of his pocket and will this improve CO2 emissions? No. It will be what we already have today with ethanol”, says Gussi.

To be viable, according to Unica, the electric car has received subsidies ranging from US$ 3,000 to US$ 9,000 in Germany, and around US$ 7,500 in the United States. “Would it be rational for the Brazilian government to now subsidize vehicles, to give between BRL 18,000 and almost BRL 60,000 for the person to buy a vehicle, given that today we already have vehicles that have the same decarbonization rate? ’ asks the executive.

“The calculation we do is in grams of equivalent CO2 per kilometer driven. When I do the life cycle assessment, when I look at how many grams of emissions I have in the Brazilian electric vehicle, and how many grams in the flex-fuel vehicle, running on ethanol, the difference is practically none. And ethanol has increasingly gained energy-environmental efficiency, that is, it is increasingly emitting less. Because we are improving processes in the field and soon I may even have zero-emission ethanol”, argues Gussi.

Betting on electric cars could cause deindustrialization, says Unica

Betting on the replacement of ethanol by the electric car could imply a rapid de-industrialization of the country, warns the president of Unica. And it wouldn’t make sense, according to him, because the solutions have similar results in terms of sustainability.

“If we remove the frisson from public relations and lobbying, and nothing against lobbying made with a high level of compliance, if we remove this foam, the question remains: why am I going to make trillionaire investments, and who The Brazilian taxpayer is going to pay for this at the end of the day, since I already have a solution that achieves the same result? And at no cost to society, on the contrary, generating jobs and income”, he says.

“Electrification in Brazil means deindustrialization in Brazil. Electric car industrial plants for economic reasons will be in the USA, Europe and China. They will not happen in Brazil on a large scale, they will not happen in Africa on a large scale, they will not happen in Asian countries, except for China. If you consult the 15 main automotive industry consultants in the world, no one will sign a document saying that Brazil will be a large industrial park for electric vehicles. Is not true. The strategy of automakers focused exclusively on electrification is different from Toyota, Stellantis and Volkswagen, who say ‘look, let’s have electrification projects where it makes sense, and let’s have bioenergy projects where it makes sense’. That strikes me as smarter,” he says.

“Out of every ten questions I receive, eleven are like this: will it be electrification or ethanol? I refuse to answer that childish question. I say that it will be what is good for certain regions, certain countries, taking into account a series of factors, which are summarized in these two things: delivery of decarbonization and better cost-benefit for society of this delivery. I am not against the electric car. There are places where electrification will deliver decarbonization at the lowest cost to society. And then great, it has to be electrification”, says the executive.

India proposes alliance around ethanol

In this year in which it occupies the presidency of the G20, India has set the goal of establishing a Global Biofuels Alliance, led by the three main players in the sector – India itself, Brazil and the United States. The idea is to create an ecosystem of technological cooperation and standards for fuels and engines, with a view to favoring the expansion of biofuels such as ethanol.

Gussi believes that this is a path of no return. “Unica contributed a lot to this project that is taking place in India, the most populous country in the world and which has more than 80% of its energy matrix based on fossils. Indians have understood that pure electrification does not solve their emissions, because more than 70% of their electrical energy comes from coal. They have ethanol production potential and are betting on it, intelligently. So much so that there is an agreement between Toyota Brazil and Toyota India, for a flex-hybrid pilot project, and the first car has already been sent there for testing”, he underlines.

“India did not mix almost any ethanol in gasoline, today it already mixes 10%, by 2025 it will mix 20%. Brazil. The Indian Prime Minister said that ethanol is one of India’s main strategies in the 21st Century. Asia”, concludes Gussi.