1998 Research Clinic

Research Paper Summaries 

by Jennifer Renshaw

Burning fossil fuels for energy results in the release of 'greenhouse gasses' (GHG's) which are detrimental to the atmosphere. Predictions of global warming have prompted international interest in environmentally sustainable fuels. As a result, biomass energy produced from organic matter is receiving increasing attention. In developing countries, biomass energy is often the primary energy source, supplying over 90% of total energy requirements. The global demand for biomass is expected to rise in the future, due to population growth, increased use of biomass fuels in industrialized countries, and the development of improved technologies for creation, conversion, and use of biomass fuels (Hall 1991).

Brazil was 80% dependent on foreign oil when the price skyrocketed in 1973. In 1975 the Brazilian government initiated an aggressive, nation-wide renewable energy program called Pro-alcool. It was created with the intention of reducing Brazilian dependence on foreign oil. Its objectives included reducing regional income differences; increasing job opportunities for skilled and unskilled laborers; and increasing industrial production (as a result of increased demand for Brazilian-made manufacturing equipment). However, it is not clear that these goals have been attained.

The Brazilian sugar industry currently employs 1.2 million people directly and three million indirectly (Alternative Fuels Network Online 1996). Of these, approximately 500,000 are under the age of 17. A 1994 study found that 58% of these children had suffered accidents at work, mostly from machetes and sickles (Osava 1996). In addition, crop burning as part of the cane harvesting process causes serious air pollution which can lead to respiratory problems and cancer. Ethanol production also creates large quantities of liquid waste, which has contaminated rivers.

In 1987 the Pro-alcool program began to falter. Manufacturers felt that they were not being fairly compensated. Petrobras, the primary ethanol distributor, started losing an estimated $1.8 million per day. The downward decline continued into 1996, by which time 70 of the 346 distilleries had closed and 80 more were close to bankruptcy. Through the 1990's leaders of Brazil let Pro-alcool's subsidies dwindle. In 1997, however, President Cardoso announced the reincarnation of Pro-alcool in a plan calling for tax exemptions for the purchase of vehicles run on ethanol. In addition, rather than continuing subsidies, taxes would be levied against higher polluting fuels.

Continuation of Pro-alcool is important to Brazilian leaders for several reasons. Concerns about GHG's, global warming, and air pollution in congested cities have peaked interest in alternative fuels. At a time when developed countries are looking for alternative energy sources, it would be unwise not to cultivate Brazilian expertise. Also, new technology may increase the competitiveness of ethanol fuel.

However, while the Pro-alcool program has been successful in reducing urban greenhouse gas emissions, it is unclear that the benefits of the program outweigh its costs. Socially, the overall welfare of rural workers does not appear to have improved. Environmentally, in addition to air pollution and river contamination, plantation production may result in the loss of topsoil, loss of wilderness, and the increased use of chemical fertilizers which use fossil fuels, and cause local soil and ground water pollution (National Research Council 1983). The additional pollution in rural areas may outweigh the abatement in urban centers.

Many people also believe Pro-alcool has been an economic failure. It has not been sustainable without large subsidies. The ideal biomass fuel program is environmentally sustainable, replicable, flexible, and economically efficient when all the externalities are considered (Hall 1991). These externalities must include the costs of environmental degradation to media other than the atmosphere.

However, even if the environmental criteria are met, the program should be considered a failure if it becomes a "vehicle for human rights abuses" (UNDP 1998). While some benefits such as better health care and education may have resulted from Pro-alcool, the overall welfare of rural workers does not appear to have changed much as a result of the ethanol program. The movement to renew Pro-alcool may be positive, if it is accompanied by both social and environmental measures.