Yayyyyyy!!!!

A Guide to Ethanol Production:

Latin America as an example for change

and expectations within the US.

Daniel Judge

Senior Seminar

Dr. Derek Stanovsky

Interdisciplinary Studies Department

Appalachian State University

May 2007

“Energy services are essential for sustainable development. The way in which these services are produced, distributed and used affects the social, economic and environmental dimensions of any development achieved. Although energy itself is not a basic human need, it is critical for the fulfillment of all needs. Lack of access to diverse and affordable energy services means that the basic needs of many people are not being met.”

— A Framework for Action on Energy, World Summit on Sustainable Development, Johannesburg 2002

Table of Contents:

Introduction Pg.4

Basic Ethanol Production and History Pg.5

Ethanol Historic Timeline Pg.6

The Ethanol Conspiracy Pg.7

Brazil:

The Pioneer Pg.9

1973 Oil Crisis Pg.9

The Beginnings Pg.10

Flex Fuel Cars Pg.11

Energy Leader? Pg.12

US:

Ethanol Production Pg. 16

Flex Fuel Cars Pg.17

Ethanol Ethics:

1) Energy Return Pg.18

2) Food vs. Fuel Pg.20

3) Where is the Land? Pg.22

Brazil for Predictions Pg.24

Brazilian vs. US infrastructure Pg.25

Cellulosic Ethanol Pg.26

Conclusion Pg.28

Bibliography Pg.30

Introduction:

It is no secret that we are facing an energy crisis in the world today. The 20^th century brought us the automobile for personal transportation and this trend has spread like a wildfire across the world. Today the world contains around seven hundred million personal vehicles, with the majority of them running on gasoline. We have moved beyond the time when cars were luxuries and they are now an important part of our lives. Here in the United States we have around seven hundred vehicles for every one thousand people. In China the number is much lower; twenty vehicles for every one thousand Chinese.[1] China is the largest growing economy in the world and it is only a matter of time before they enjoy vehicle numbers like us in the US. With this in mind and other big countries in Asia such as India following the same trend, it is obvious that the relatively low oil prices we have seen in our lifetime will cease to exist. This is a major reason why biofuels have emerged on the world market as a potential commodity to either reduce or end our dependence on petroleum as a fuel source. Among the pioneers in this field, Brazil stands out as the first to put full scale biofuel infrastructures in place to help end the countries economic dependence on petroleum. The US is also a leader in ethanol production, but the fear is that our feedstock is unsustainable at the present and new technologies must emerge before our crops will have the energy return seen in Brazil’s ethanol production. This paper will show the potential of Brazil as a model for ethanol production and the future possibilities for US ethanol production.

Basic Ethanol Production and History:

Ethanol is a clear, colorless alcohol based fuel derived from the glucose molecules found in various plants. Corn, potatoes, rice, yard clippings, sugar cane, sugar beets, sorghum, wheat and sunflowers are just some of the feedstocks that ethanol can be produced from. Corn is the most popularly used feedstock here in the US. This requires the use of yeast to first break down starches into sugars through fermentation. Another fermentation process turns these sugars into alcohol, which is then used as fuel. Cellulosic ethanol is another form of ethanol derived from plant waste, such as forestry residue, corn stalks, and any other residue from plant cultivation. Residue from sugarcane can even be transformed into cellulosic ethanol.

[2]

Ethanol History Timeline

· 7000 B.C.-Ethanol has been used by humans as an intoxicating ingredient in alcoholic beverages. Dried residues pottery found in northern China imply the use of alcoholic beverages even among Neolithic peoples.

· 860 A.D.- Al-Kindī unambiguously described the distillation of wine. Distillation of ethanol from water yields a product that is at most 96% ethanol, because ethanol forms an azeotrope with water.

· 900 A.D.-Ethanol’s isolation as a relatively pure compound was first achieved by Islamic alchemists who developed the art of distillation during the Abbasid caliphate, the most notable of whom was Al-Razi.

· 1796-Absolute ethanol was first obtained in by Johann Tobias Lowitz, by filtering distilled ethanol through charcoal.

· 1808-Antoine Lavoisier described ethanol as a compound of carbon, hydrogen, and oxygen, and in, Nicolas-Théodore de Saussure determined ethanol's chemical formula.

· 1858-Archibald Scott Couper published a structural formula for ethanol: this places ethanol among the first chemical compounds to have their chemical structures determined.

• 1826-Ethanol was first prepared synthetically through the independent efforts of Henry Hennel in Britain and S.G. Sérullas in France.
• 1826-Samuel Morey developed an engine that ran on ethanol and turpentine.
• 1828-Michael Faraday prepared ethanol by the acid-catalysed hydration of ethylene in a process similar to that used for industrial ethanol synthesis today.
• 1860-German engine inventor Nicholas Otto used ethanol as the fuel in one of his engines. Otto is best known for his development of a modern internal combustion engine (the Otto Cycle) in 1876.
• 1862-The Union Congress put a $2 per gallon excise tax on ethanol to help pay for the Civil War. Prior to the Civil War, ethanol was a major illuminating oil in the United States. After the tax was imposed, ethanol cost too much to be used this way.
• 1896-Henry Ford built his first automobile, the quadricycle, to run on pure ethanol.
• 1906-Over 50 years after imposing the tax on ethanol, Congress removed it, making ethanol an alternative to gasoline as a motor fuel.
• 1908-Henry Ford produced the Model T. As a flexible fuel vehicle, it could run on ethanol, gasoline, or a combination of the two.
• 1917 – 1918-The need for fuel during World War I drove up ethanol demand to 50-60 million gallons per year.
• 1920's-Gasoline became the motor fuel of choice. Standard Oil began adding ethanol to gasoline to increase octane and reduce engine knocking.
• 1930's-Fuel ethanol gained a market in the Midwest. Over 2,000 gasoline stations in the Midwest sold gasohol, which was gasoline blended with between 6% and 12% ethanol.
• 1941-1945-Ethanol production for fuel use increased, due to a massive wartime increase in demand for fuel, but most of the increased demand for ethanol was for non-fuel wartime uses.
• 1945-1978-Once World War II ended, with reduced need for war materials and with the low price of fuel, ethanol use as a fuel was drastically reduced. From the late 1940's until the late 1970's, virtually no commercial fuel ethanol was available anywhere in the U.S.
• 1973- Brazil begins to implement plans for alternative and domestic energy sources.
• 1974-The first of many legislative actions to promote ethanol as a fuel, the Solar Energy Research, Development, and Demonstration Act led to research and development of the conversion of cellulose and other organic materials (including wastes) into useful energy or fuels.
• 1979-Marketing of commercial alcohol-blended fuels began. Amoco Oil Company began marketing commercial alcohol-blended fuels, followed by Ashland, Chevron, Beacon, and Texaco. About $1,000,000,000 ($1 billion) eventually went to biomass related projects from the Interior and Related Agencies Appropriation Act.
• 1980- First U.S. survey of ethanol production was conducted. The survey found fewer than 10 ethanol facilities existed, producing approximately 50 million gallons of ethanol per year. This was a major increase from the late 1950s until the late 1970s, when virtually no fuel ethanol was commercially available.
• 1980– 1984 Congress enacted a series of tax benefits to ethanol producers and blenders. These benefits encouraged the growth of ethanol production. The number of ethanol plants in the U.S. peaked at 163. The Tax Reform Act increased the ethanol subsidy to 60 cents per gallon. Many ethanol producers went out of business, despite the subsidies. Only 74 of the 163 commercial ethanol plants (45%) remained operating by the end of 1985, producing 595 million gallons of ethanol for the year.
• 1991- Dr. Lonnie Ingram finishes groundbreaking scientific work with bacteria, a harmless strain of the E. coli bacteria, that can convert all sugars in plant waste into ethanol is immediately licensed by a company seeking to market the technology but is ruined by a company scandal. BC International picks up the license but also struggles to launch the concept despite an $11-million grant from the Department of Energy.
• 1995-With a poor corn crop and the doubling of corn prices in the mid-1990s to $5 a bushel, some States passed subsidies to keep the ethanol industry solvent.
• 1997-Major U.S. auto manufacturers began mass production of flexible-fueled vehicle models capable of operating on E-85, gasoline, or both. Despite their ability to use E-85, most of these vehicles used gasoline as their only fuel because of the scarcity of E-85 stations.[3]

The Ethanol Conspiracy:

Looking at the timeline, it is clear that ethanol is not new to the scene of fuels. It is the oldest known manufactured fuel that exists. With this in mind, why is ethanol not the number one fuel in the world or why is it not at least being used on the small scale E10 level that is the most feasible idea for our country? Government intervention seems to be the answer most people come up with. Through the use of taxes, ethanol production has been both supported and dejected for its appropriateness in our domestic market at the time. When oil is scarce or expensive, ethanol production increases and when oil is cheap on the market, ethanol production is swept under the rug. Right now is an anomaly of sorts. With the introduction of Earth Friendly legislation, it is the people that are finally calling for more eco-friendly ways to solve our energy problems.

“Legislation, such as the Clean Air Act Amendments (CAAA) of 1990 and the Energy Policy Act of 1992, has opened markets for alternative fuels that can be produced from US domestic resources and give an environmental advantage over petroleum based fuels. In addition, many US farmers and policymakers support the development of ethanol and biodiesel, as a means of creating new markets for agricultural commodities. Recently the JOBS Act of 2004 and the Energy Policy Act of 2005 have given a real boost to biofuel production in the US.”[4]

Now ethanol is being pushed with some ferocity as government subsidies are giving rise to ethanol factories all over the mid-west. “[Ethanol] accounted for only around 3.5% of American fuel last year, but production is growing by 25% a year. That’s because the government both subsidizes domestic production and penalizes imports. As a result, refineries are popping up like mushrooms all over the Midwest, which now sees itself as the Texas of green fuel.”[5] This is setting an alarming trend that is producing a positive energy gain of 33% at the most and arguably a negative energy return. It is in the best interests of big business to push ethanol, no matter what form, here in the US because of its relatively low-cost transition capabilities from gasoline. Ethanol with a return of three to ten times more energy return is being heavily taxed and is coming from Brazil. It is an irresponsible stance to take, if emissions and eco-friendly legislation are what is behind this ethanol movement, not big business and economic interests.

Brazil the Pioneer:

The seventies turned out to be a turning point in petroleum prices all over the world. At a time when Brazil was developing economically, oil prices almost quadrupled on the world market. Brazil’s economy was already suffering and this only furthered instability, as a result they began to explore alternative solutions. They began off-shore exploration for petroleum and implemented a program to make large quantities of ethanol from sugarcane to substitute gasoline.[6]

1973 Oil Crisis:

The 1973 Oil crisis marked an increase in oil prices all over the world. Through collaboration between the Syria, Egypt and the Arab members of OPEC, they managed to increase the market value of crude oil by four times its original amount. This happened by four changes.

• Nationalization of private companies
• Price Increases
• Limitations on output
• Cutbacks on delivery

The underlying reason for this crisis was Yom Kippur War, where Egyptian and Syrian forces mounted a surprise attack on Israel on the Jewish holiday of Yom Kippur. It lasted less than a month, but the Arab alliance that backed both Syria and Egypt said it would no longer export oil to the countries that supported Israel during the conflict. This was designed to hurt the US and European countries that aided Israel. Realizing the world’s dependence on OPEC oil, they put into effect inflationary measures that quadrupled oil prices around the world. This was also aimed at the countries that supported Israel, but its affects were felt worldwide. Nations across the world reacted in various ways, with Brazil implementing its ethanol program.

The Beginning of the Brazilian Ethanol Program:

The change to ethanol production was a convenient for Brazil’s economy at the time. Since the eighteenth century sugarcane has been a substantial part of Brazil’s agriculture sector. In the mid seventies, Brazil was the third largest sugar producer around five million raw tons. At the same time sugarcane was in a price drought on the international market. So the decision was made to divert some of the sugar for ethanol production.

There were two ethanol approaches the government took at the time. The first was to make anhydrous alcohol to make E10 or ten percent ethanol, ninety percent gasoline. The upside to this was it required no engine modifications. The other approach was to modify engines to accept hydrated ethanol that consisted of ninety-five percent ethanol and five percent water. This was used in modified gasoline engines.[7]

Brazilian Flex-Fuel Cars:

The automobile industries in Brazil got on board in making modifications to cars for sale on the domestic market. With minor modifications done by the manufacturers the vehicles run on E25. This development has led to the production of flex fuel technology that is commercially available. These vehicles surprisingly sell for no additional cost. They account for twenty percent of the cars sold in Brazil now and can run on gasoline, ethanol, or natural gas.[8] Ironically, the US company GM has released a line of cars in Brazil, but Volkswagen has the biggest market share. The reason these cars are not being sold on the world market is because no other country has the infrastructure to accommodate a large amount of flex-fuel cars while Brazil offers ethanol at almost every station.

Now with their domestic infrastructure, Brazil has its eyes set on exporting these cars. Volkswagen has hosted delegations from Australia, China, England, India, Japan and South Africa.[9] It is the lack of infrastructure in other countries that will keep this from happening for at least a few more years. In Brazil ethanol is offered at almost every pump, finding stations that sell ethanol in the US or European countries presents many problems for a possible driver. “The problem with these flex-fuel vehicles is they need to meet with an established infrastructure, in the case of Brazil, the fuel was there first.”[10] Another option presented is natural gas. GM released its new flex-fuel car with natural gas as another option, the first car to do so.

Brazil, Possible Energy Leader?

Brazil’s domestic oil explorations have managed to pay off as well. Until recently, Shell Oil was the sole investor to off-shore petroleum exploration. Now European nations are looking at buying “blocks” for exploration as well as other nations within Latin America.

“Italian, Norwegian, Spanish and Argentine companies won oil exploration and production concessions at an annual government auction here Tuesday, but a federal judge in Brasilia later suspended the auction. The court objected to a rule of Brazil's National Petroleum Agency that limits the number of offers a bidder can make.” [11]

This is news as of the end of 2006, but it shows a growing interest in Brazilian oil potential and that this program is proving to pay off. Brazil has been busy in recent energy news. They are forming energy co-ops with countries all over the world. They are buying blocks for petroleum exploration in various parts of Africa where they are also exploring for coal; they have signed exploration agreements with Venezuela and are still highly involved in domestic exploration.

1) December 1^st, 2006 “Colombian state-run oil company Empresa Colombiana de Petroleos (Ecopetrol) in a partnership with Brazilian oil and gas group Petroleo Brasileiro SA (Petrobras) will develop oil prospecting in Brazil, the Colombian company reported on November 30, 2006.”[12]

2) December 11, 2006 “During Chavez's visit to Brazil Thursday, four energy cooperation agreements were signed between Venezuela 's state-owned Petroleos de Venezuela (PDV) and Brazilian state-controlled Petrobras .”[13]

3) March 10^th, 2007 “President Bush yesterday insisted the United States is not neglecting Latin America and celebrated an alternative-fuels pact with Brazil as proof.”[14]

4) April 3^rd, 2007 “Mexico and Brazil have agreed to form a joint commission to foster cooperation on issues like deepwater oil exploration and production and ethanol production.”[15] (Mexico, Brazil to Increase Energy Cooperation)

5) April 4^th, 2007 “The presidents of Brazil and Ecuador signed agreements Wednesday for the two countries to jointly produce biofuels… "We will give Ecuador's biofuel program our full support," said Brazilian President Luiz Inacio Lula da Silva.[16]

6) April 5^th, 2007 “Brazil's state-owned energy company Petrobras and its Ecuadorian counterpart Petroecuador signed an agreement on Wednesday, with the aim to exploit the Ishpingo-Tiputini-Tambococha (ITT) oil fields in the Yasuni National Park in Ecuadorian Amazon

You can see that Brazil is not only working on there own infrastructure, but they are allying themselves with countries all over the world to ensure their energy security for the future. This push for energy relations throughout Latin America can be viewed with great enthusiasm. Brazil is still very involved in making petroleum relations, but with the amount of ethanol the country produces, they are also spreading their ethanol ideas throughout the continent. Much of this has happened just this month and will only continue to grow in the coming months.

United States Ethanol Production:

Like the rest of the world, the US is no stranger to ethanol production. Ethanol was used as a light source for part of the 19^th century, until the Union congress imposed a two dollar per gallon tax to help pay for the war. This made it uneconomical to continue its use.[17] In 1896 Henry Ford invented his first vehicle to run on pure ethanol. In 1908 he invented the Model-T, hailed as the beginning of affordable cars. It was a flex-fuel car! The US was headed in a direction of ethanol use and it seemed this would happen. The drop of oil prices and prohibition ended up sending us in the other direction. Prohibition, which started in 1920, forbade the production and sale of alcohol. Since ethanol is an alcohol based fuel, this legislation led to the end of home ethanol production. The Oil Crisis of 1973 led the US to reexamine its fuel use and ethanol production reemerged. “In 1978 the US Congress approved the National Energy Act which included a federal tax exemption for gasoline containing 10% ethanol, which made the product economically viable as a gasoline blending component.”[18] Presently, there are various legislations in favor of ethanol production. One of the latest boosters to help the program is the ban placed on MTBE (Methyl Tertiary Butyl Ether) because of its contamination of groundwater. MTBE is used as an oxygenate for gasoline and is now being replaced by the E10 blend of 10 % ethanol and 90% gasoline.[19]

US Flex-Fuel Vehicles:

There are walls to be scaled still as far as flex-fuel cars here I the US is concerned. While flex-fuel cars can be used for both gasoline and ethanol, the trend is not taking hold because of the lack of ethanol pumps around the country. Consumers can not even fathom the idea of buying flex-fuel cars when there is no infrastructure for them to use. There are around five million flex fuel vehicles in the US presently, but only 700 of our 170,000 gas stations offer E85 at the pump. Thirteen states (eight on the East Coast) have no ethanol pumps at all.[20] Subsidies are promoting a boom in flex-fuel vehicles, but without ethanol being offered at the pumps, I’m afraid that these vehicles will only flex in one direction, gasoline.

Is Ethanol Ethical?

Three of the largest debates about ethanol are:

1) Energy Return for Ethanol Production

2) Food vs. Fuel

3) Where is the land to produce these crops?

1) Energy Return –

US - While a USDA study has stated that the energy return for corn based ethanol is 1.67 to 1, or about 66% positive energy gain, other research has pointed to the opposite. “A study done at Cornell University and University of California at Berkeley take into account such factors as the energy used in producing the crop (including production of pesticides and fertilizer, running farm machinery and irrigating, grinding and transporting the crop) and in fermenting/distilling the ethanol from the water mix.”[21] Their results[22] were not positive.

• corn requires 29 percent more fossil energy than the fuel produced;
• switch grass requires 45 percent more fossil energy than the fuel produced; and
• wood biomass requires 57 percent more fossil energy than the fuel produced.

These numbers are greatly disputed in the academic community, but even the best information shows only a 66% gain in energy[23], far less than will be needed to reduce our petroleum dependence.

Brazil – The numbers for sugarcane energy return are far greater. Some put it at 3 to 10 times energy return. “That is why the energy balance for sugarcane ethanol is the best in the world for biofuels with commercially available technologies: up to 10 output units for each input unit.”[24]

With energy return percentages that could reach 1000%, Brazil is using a feedstock that is appropriate for the country and for use as a fuel.

2) Food vs. Fuel –

Another topic of debate is in the “sinister idea of converting food into fuel”, Fidel Castro warned in his latest critique of President Bush.[25] This has proved to be correct with Mexican corn prices increasing by up to 60% at the tortilla stand. “An increase in the cost of tortillas, a staple of the Mexican diet since the Maya ruled 1,000 years ago, has triggered a slump in the peso.”[26] Not only as this increased the price of food, but this increase is destabilizing their economy. “That increase fanned inflation and a bond market rout that curbed demand for the currency. The peso has fallen 2.4 percent in the past month, making it the world's third-worst performer against the dollar among the 70 currencies tracked by Bloomberg.”[27] People have begun to draw connections between corn ethanol productions increased demand for corn and the rise in corn prices. “Corn has soared 15 percent in the past eight weeks and 119 percent since late 2005 as demand for the grain grows from ethanol producers.”[28] Corn is popularly used as animal feed in the hog and cattle industries. Ethanol’s ripple effect dubbed “ethanoinflation[29]” by one article, has spread into the meat sector. “The ethanol-driven demand for corn had driven up Schafer's feed costs about 35 percent since September. The price for hogs hasn't changed. Yet.”[30] Corn prices are on the rise and meat prices are sure to follow. The use of such an important crop is not the most responsible approach to our energy problems. Ethanol should be the solution to problems, not the beginning of new ones.

3) Where is the land to produce these Crops? –

Finding enough agricultural land to supply the US with crops for ethanol has posed another problem. To curb our dependency from petroleum, we consume 140 billion gallons; we would need more land than is available. Speculation says that we will outsource our energy crops to poorer countries that may end up replacing food crops with energy crops if the price is right. We do not have enough agricultural land to produce E85 for the country. At best, we can displace the 10 percent to make an E10 bland that all cars can use and this would require 14 billion gallons of ethanol. Another option for finding this agricultural land is through deforestation. This is the route Brazil has taken. This is happening at an alarming rate, and it only shows signs of continuing. “According to the Brazilian Census Bureau, or IBGE, the area planted with sugarcane went from 6.15 million hectares (15.2 million acres) in 2005 to 6.58 million hectares (16.26 million acres) in 2006.”[31] Sugarcane alone accounted for an extra million acres of agricultural land needed.

“The ethanol industry has been linked with air and water pollution on an epic scale, along with deforestation in the Amazon and Atlantic rainforests, as well as the wholesale destruction of Brazil's unique savannah land.”[32] This rise in deforestation is causing problems with the CO2 balance that biofuels hope to reduce. “Despite its leading role in bio- fuels, Brazil remains the fourth largest producer of carbon emissions in the world due to deforestation. Clouds of black smoke from the arc of destruction across the Amazon are visible from space as the most important carbon sink and climate control on the planet is cut and burned.”[33] Reducing the amount of rainforest puts an enormous amount of strain on the world to recycle CO2. Par of the biofuel vision is to reduce these CO2 gases. Since forests especially the Amazon are areas of CO2 consumption, this could actually lead to a rise in greenhouse gases in the end and reverse the carbon neutral idea that drives biofuel technology.

Using Brazil for Environmental and Economical Predictions:

Brazil can also be used as an example of what emissions to expect in large urban areas with thousands of cars are burning various grades of ethanol. The US Environmental Protection Agency along with help from the University of San Paulo, Brazil conducted various tests to check the emissions levels in large cities for a comparative analysis. These help in forming expectations from widespread ethanol usage in areas such as Los Angeles, CA.

These are their results.

Brazilian Infrastructure vs. US Infrastructure

As I said before, Brazil was fortunate to have sugarcane as a prominent crop within the country to use. In other countries they are often lacking a staple crop to use for biofuel like here in the US. Using corn for energy does not have a high enough energy return to continue its production.

In the past, the Brazilian Government subsidized this programme through a variety of mechanisms, particularly `soft' loans to the sugarcane growers, which built ethanol distilleries, and incentives to encourage people to purchase pure ethanol driven cars. Estimates of the total amount of investment in the agricultural and industrial sectors for automotive ethanol fuel between 1975 and 1989 reach a total of US$ 4.92 billion (2001 US$). Oil imports avoided meant savings amounting to US$ 52.1 billion (January 2003 US$) from 1975 to 2002. [34]

Another convenient part of their service stations were that they had pumps for both regular and “super gas” which contained lead still. Much like our octane pumps here in the US. They were simply able to replace the “super gas” with ethanol and they had a pump infrastructure set up. This leads me to believe that the US has much of the same potential for infrastructure. Tanks in the gas station need to be changed, but we have the whole pump system ready to go all over the US. If we produce an efficient ethanol crop we could drop mid grade octane fuel (88-90), then we could have an open ethanol pump at almost every gas station in the country. We are already providing around 1.4 billion dollars in subsidies to promote ethanol production. It seems that our shortcomings are in debating its viability. It has been proved that corn ethanol is not an energy solution. In Brazil sugarcane works, in the US our best chance lies in the technology for cellulosic ethanol. This is where the money for research needs to be concentrated if we plan to solve our domestic energy problem.

Cellulosic Ethanol:

Cellulose technology is the future of US ethanol. Corn ethanol has been increasingly scrutinized for it economic inefficiency and social impact of food being used for fuel. By using cellulose technology, this could all come to an end. Instead of using the actual food itself, the agricultural residues are used. “Agricultural residues are produced in large quantities throughout the world. Approximately, 1 kg of residue is produced for each kilogram of grains harvested. This ratio of grain residue translates into an excess of forty billion tons of crop residue produced each year in the USA.”[35] Using this agricultural residue will change the need to use the corn itself as a fuel product. Sugarcane seems to have similar potential. “The results indicate that ethanol can be made from the sugarcane residue. The fermentation system needs to be optimized further to scale up the process for large-scale production.”[36] Right now most of the agricultural residue is being burnt. The one bump in the road to this cellulose technology is the price on enzymes at the present. Cellulosic ethanol requires a very high input of enzymes and this is not economically feasible yet. “In 1991, the university was awarded the nation's 5-millionth patent in a special ceremony at the Commerce Department. It recognized groundbreaking scientific work by Ingram's team with a bacteria that could convert plant waste into ethanol, a cleaner-burning substitute for gasoline.”[37] This technology was developed in 1991 and it still has not hit the drawing boards. Three companies have failed to release this technology upon the biofuel world. Instead of subsidizing a program that will ultimately fail, the money needs to be poured into programs like this one at the University of Florida, so we can enjoy cleaner cheaper fuel for our vehicles without hurting the world’s food supply.

Conclusion:

Ethanol technology has come a long way since the seventies. Brazil’s economy has expanded as a result of their production facilities and they have become a very self sustainable country as far as domestic energy needs are concerned. . Both of our countries will be greatly assisted by the development of cellulosic technologies. Agricultural residues could prove to be the key to our energy crisis. Brazil is acting in part as a forerunner for other parts of Latin America to follow. By signing cooperative agreements and sharing technological ideas, Brazil is helping to form an alliance that could lead to massive sustainable ethanol production throughout Latin America one day. If problems with deforestation are controlled than I see nothing but positive implications for Latin American countries involved in this energy future. The US on the other hand seems to be headed in the wrong direction. Our present policy is using food supplies, that in turn rise both meat and agriculture prices. Corn does not have a high enough energy return, and is unsustainable. Our present allocation of funds into another unsustainable fuel infrastructure is inexcusable and irresponsible. “America should bin its silly policy. If it stopped taxing good ethanol (Brazil) and subsidizing bad ethanol (corn ethanol), the former would flourish, the latter would wither, the world would be greener and the American taxpayer would be richer.”[38]

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[1] Goldemberg, Jose. "The Ethanol Program in Brazil." Dec 2006 4-5-07 .

[2] http://www.hawkrenew.com/images/hawkeyes_images/process_big.gif

[3]Timeline compiled from http://www.eia.doe.gov/fuelrenewable.html, http://e85.whipnet.net/, http://www.eia.doe.gov

[4] Pelkmans, Luc. "BIOFUELS IN THE UNITED STATES." Premia (2005). 12 Apr. 2007.

[5]"Castro Was Right." The Economist 7 Apr. 2007: 13-14.

[6] Goldemberg, Jose. "The Ethanol Program in Brazil." Dec 2006 4-5-07 .

[7] Goldemberg, Jose. "The Ethanol Program in Brazil." Dec 2006 4-5-

07 .

[8] Goldemberg, Jose. "The Ethanol Program in Brazil." Dec 2006 4-5-07 .

[9] Associated Press. Brazil Buys Into Flex-Fuel Cars. MSNBC. NBC, 2004. .

[10] Associated Press. Brazil Buys Into Flex-Fuel Cars. MSNBC. NBC, 2004. .

[11] Associated Press, "Italian, Norweigan, Spanish and Argentine companies win oil concessions at Brazil auction." 11-28-2006 4-05-07 .

[12] Latin America News Digest, "Colombian Ecopetrol, Brazil Petrobras To Cooperate in Oil Prospecting in Brazil." 12-1-06 4-15-07 .

[13] Energy Intelligence Group, Inc., "Chavez Expands Oil Diplomacy in Tour of South America." 12-11-2006 4-15-07 .

[14] Newark Morning Ledger Co., "Bush signs ethanol pact in Brazil." 03-10-2007 04-5-07 .

[15] Energy Intelligence Group, "Mexico, Brazil to Increase Energy Cooperation." 4-3-07 4-15-07 .

[16] Xinhua News Agency, "Brazil and Ecuador Sign Energy Cooperation Agreement." 4-5-07 4-15-07 .

[17] Pelkmans, Luc. "BIOFUELS IN THE UNITED STATES." Premia (2005). 12 Apr. 2007.

[18] Pelkmans, Luc. "BIOFUELS IN THE UNITED STATES." Premia (2005). 12 Apr. 2007.

[19] Pelkmans, Luc. "BIOFUELS IN THE UNITED STATES." Premia (2005). 12 Apr. 2007.

[20] Gardner, Tomothy. "The Price Must Be Right for US Drivers to Switch Fuels." Midland Independent Newspaper 26 Dec. 2006. Lexxus Nexxus. 12 Apr. 2007.

[21] Lang, Susan. "Cornell Ecologist's Study Finds That Producing Ethanol and Biodiesel From Corn and Other Crops is Not Worth the Energy." Cornell University News Service 5 July 2005. 12 Apr. 2007 .

[22] Lang, Susan. "Cornell Ecologist's Study Finds That Producing Ethanol and Biodiesel From Corn and Other Crops is Not Worth the Energy." Cornell University News Service 5 July 2005. 12 Apr. 2007 .

[23] Shapouri, Hosein. "THE 2001 NET ENERGY BALANCE OF CORN-ETHANOL." USDA (2001). 12 Apr. 2007 .

[24] Goldemberg, Jose. "The Ethanol Program in Brazil." Dec 2006 4-5-

07 .

[25] "Castro Was Right." The Economist 7 Apr. 2007: 13-14.

[26] Rota, Valerie. "Peso Slumps with Rise of Tortilla Prices;." The Houston Chronicle 6 Mar. 2007. 12 Apr. 2007.

[27] Rota, Valerie. "Peso Slumps with Rise of Tortilla Prices;." The Houston Chronicle 6 Mar. 2007. 12 Apr. 2007.

[28] Rota, Valerie. "Peso Slumps with Rise of Tortilla Prices;." The Houston Chronicle 6 Mar. 2007. 12 Apr. 2007.

[29] Russi, Daniela. "Biofuels: An Advisable Strategy?." 23-03-07 4-2-07 .

[30] Bjorhus, Jennifer. "Ethanol: a Ripple Effect: Livestock Growers Feeling Squeezed as Corn Prices Surge on Demand for Fuel." Lexxus Nexxus (2007). 12 Apr. 2007 .

[31] Associated Press, "Brazilian farmers increase sugarcane production." 04-09-2007 04-15-07 .

[32] Independent. "ETHANOL PROVES SWEET ALTERNATIVE BUT AT a COST." Financial Times. Lexxus Nexxus. 12 Apr. 2007.

[33] Independent. "ETHANOL PROVES SWEET ALTERNATIVE BUT AT a COST." Financial Times. Lexxus Nexxus. 12 Apr. 2007.

[34] Goldemberg, Jose. "The Ethanol Program in Brazil." Dec 2006 4-5-07 .

[35] Dawson, Boopathy, Letha, Raj. "Use of post-harvest sugarcane residue for ethanol production." (2006) 4-15-07 .

[36] Dawson, Boopathy, Letha, Raj. "Use of post-harvest sugarcane residue for ethanol production." (2006) 4-15-07 .

[37] Adams, David. "Fuel Breakthrough Still Sputters." St. Petersburg Times 5 Dec. 2005. Lexxus Nexxus. 12 Apr. 2007.

[38] "Castro Was Right." The Economist 7 Apr. 2007: 13-14.