On the June 11, 2006 airing of the Sunday news show "Meet The Press", host Tim Russert was so smitten by the ethanol solution, he simply would not let it go.  It became rapidly apparent that he judged the success of American "energy independence" and "energy security" by the big oil companies willingness to go after the ethanol dream with all they had.  He repeated the "Brazil example" again and again, despite the 5 Oil compnies CEO's whom he was in the process of questioning expressing serious doubts and concerns about whether the "ehtanol solution" really was all it was cracked up to be.  

The portion relavent to our discussion involves the amont of ethanol that is produced in Brazil.  I bring it up here to refute what seems to be a popular assertion and belief:  That if all else fails, we can throw off the tariffs, and import billions of gallons of ethanol from Brazil, since their conditions seem to favor it.  The volumes of ethanol production in Brazil, however, are so small as to make this scenario highly unlikely if not completely impossible:

ConocoPhillips CEO James Mulva
MR. MULVA: "Brazil is a unique situation. Reason Brazil is self-sufficient in energy is not so much because of ethanol. It's because they have a very strong, growing, thriving oil production, both onshore and offshore Brazil. It's been for several decades that Brazil uses sugar cane to make ethanol. It does have an impact in terms of the price of ethanol and also on the price of sugar. Just recently, Brazil reduced the amount of ethanol that they applied towards--for fuels for automobiles from 25 to 20 percent. The reason Brazil is self-sufficient--they make great strides in terms of ethanol--but it's primarily be--due to the success of their oil production business onshore and offshore. It's been like a ninefold increase in their oil production in Brazil. It far outstrips the increase of ethanol production."

ChevronTexaco CEO David O'Reilly
MR. O'REILLY:"The problem with some of these alternatives is the scale is so small yet. You know, Brazil's gasoline market is 3 percent of the size of the U.S. market. One ethanol plant makes in a year what a typical refinery will produce in gasoline in two days."
http://www.msnbc.msn.com/id/13296235/page/5/

The tariffs, which are now becoming blamed for all sorts of horrors, really have only one effect, and that is to protect the U.S. "homegrown" ethanol industry.  There is virtually no danger that any real quantity of ethanol will come to us from South America because (a) they need it to bad for their own market (after all, they are not really making that much of it, despite the perception created by the popular media's glowing reports) and (b) even the amount they are using is already putting upward price pressure on sugar cane and thus food prices.

So for those who dream of tanker after tanker of ethanol pouring in from South America to top up the SUV with E85, first, don't hold your breath, second, it's more expensive than the gasoline you already buy, and third, you give up a quarter of your fuel mileage right off the top  (and on a truck that gets 12 or 14 MPH, that can't be good!)

Roger Conner  known to you as ThatsItImout

Your points are useful and accurate. It is not realistic to think that ethanol could contribute a large portion of global vehicle fuel - probably even in the very long term.

However, I think the focus on what Tim Russert said or the flaws in the U.S. approach obscures a topic that is far more relevant to this website: Could ethanol play a useful role in helping to transition to a future with less oil supply?

So let's leave the hype behind and instead consider a more modest proposal. Could ethanol provide 10% of global vehicle fuel within the next ten years? If so, I would say it could be one of a handful of solutions that could fill in the gap between oil produced and the amount of oil required to fuel modern lifestyles for the world.

In previous discussions here, we have established that Brazil supplied a little more than 11% of the energy input for its transportation sector from ethanol last year. Since 14% of ethanol produced is exported, this means that the country produces enough ethanol to provide 13% of its energy inputs to transportation. Previous years show even higher figures. Worldwatch Institute and the German government cite figures of 21.6% of transportation fuel from biofuels and 48.24% of non-diesel transportation use (they use 2002 consumption and 2004 production for about 40 countries). Even after adjusting these figures down by 25% for lower BTU content, they are not meaningless.

Yes, Brazil has been extremely successful in exploring for oil. But how does this hurt the ethanol case? Are you suggesting that it would be a solution elsewhere? I suspect that if Brazil had not discovered so much oil, ethanol production would be even higher.

Ethanol in Brazil is unsubsidized and is not more expensive than gasoline on a volume or BTU basis. The price has also gone up since global sugar prices have gone up. However, adjustments can and will be made. The same WW/German study says that sugar occupied 2.4% of agricultural area, half of which can be counted towards ethanol (and half towards sugar). This represents 0.5% of land with the potential for agriculture. So the potential to ramp up production is great.

By the way, the reason the Brazil's gasoline market is only 3% of the size of the US market is that half of gasoline use (by volume) is offset by ethanol and Brazil uses about 50% diesel for transportation. So Brazil's ethanol market is already 3% of the US gasoline market (by volume or about 2.2% by energy content).

Then consider that ethanol can be produced in a wide range of tropical countries using sugar, that there may be technologies that can produce ethanol viably in the US and other non-tropical regions (as Robert's article suggests, that these solutions are EROIE positive at rates of up to 8:1 and that ethanol has immense climate benefits. Why dismiss it out of hand?

I do think that we need to look for a wide range of ways to handle reduced energy supply in the future. Efficiency will be crucial, but I think prices will gradually bring this around. I also think that we will increase the amount of transportation fueled by electricity in the next decade. There are a lot of other things we need to do as well, but don't let your frustration with big mouths and bad policy make you overlook an important part of the solution.