Brazil cites flex-fuel vehicle for ethanol growth

02 March 2007 20:44  [Source: ICIS news]

ARLINGTON, Virginia (ICIS news)--A top Brazilian biofuels official said on Friday that the government’s introduction of flexible-fuel vehicles (FFVs) helped drive consumption of domestic ethanol and helped reduce oil dependency.

 

Flex-fuel vehicles can run on gasoline or ethanol or combinations of both.

 

Elisio Contini, head of the strategic management office for the Brazilian Ministry of Agriculture, told the annual US Department of Agriculture outlook forum that Brazil’s 2003 decision to invite Japanese automobile manufacturers to set up flex-fuel auto production was a driving force in building ethanol demand.

 

Contini said that in 2003, when the Brazilian government decided to stimulate flex-fuel auto sales, there were only 48,000 flex-fuel autos sold in the country. By 2004, that figure had climbed to 330,000 and reached 865,000 flex-fuel vehicles sold in 2005.

 

Last year flex-fuel vehicles reached sales of 1.45m units, Contini said, nearly 80% of all auto sales in the country.

 

“The driving force in the Brazilian ethanol market is the flexible-fuel vehicle,” Contini said.

 

Contini said that Brazil’s domestic ethanol production, which reached an estimated 18bn litres in 2006, now accounts for 29% of the country’s total energy mix. Brazil’s reliance on petroleum as an energy source has declined to 39%, he said.

 

Brazil began a major drive to develop its ethanol production in the late 1970s, he said, because it could no longer afford to continue importing petroleum, its principal auto fuels source at the time. Global oil prices increased dramatically in 1973 in the wake of the Arab-Israeli war that year and a related Arab oil embargo against the US.

 

Some 51% of Brazil’s 400m tonne/year sugar cane crop harvest goes to ethanol production, and the country plans to boost ethanol output to 37bn litres by 2015, Contini said.

By: Joe Kamalick
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