History of Ethanol Fuel in Brazil - Early Experiences

Early Experiences

Sugarcane has been cultivated in Brazil since 1532, introduced in Pernambuco that year, sugar was one of the first commodities exported to Europe by the Portuguese settlers. Ethyl alcohol or ethanol is obtained as a by-product of sugar mills producing sugar, and can be processed to produce alcoholic beverages, ethanol fuel or alcohol for industrial or antiseptic uses. The first use of sugarcane ethanol as fuel in Brazil dates back to the late twenties and early thirties of the 20th century, with the introduction of the automobile in the country. After World War I some experimenting took place in Brazil's Northeast Region, and as early as 1919, the Governor of Pernambuco mandated all official vehicles to run on ethanol. The first ethanol fuel production plant went on line in 1927, the Usina Serra Grande Alagoas (USGA), located in the Northeastern state of Alagoas, producing fuel with 75% ethanol and 25% ethyl ether. As other plants began producing ethanol fuel, two years later there were 500 cars running on this fuel in the country's Northeast Region.

A decree was issued on February 20, 1931, mandating the blend of 5% hydrated ethanol to all imports of gasoline by volume. The number of distilleries producing ethanol fuel went from 1 in 1933 to 54 by 1945. Fuel-grade ethanol production increased from 100,000 liters in 1933 to 51.5 million liters in 1937, representing 7 percent of the country's fuel consumption. Production peaked to 77 million liters during World War II, representing 9.4% of all ethanol production in the country. Due to German submarine attacks threatening oil supplies, the mandatory blend was as high as 50 percent in 1943. After the end of the war cheap oil caused gasoline to prevail, and ethanol blends were only used sporadically, mostly to take advantage of sugar surpluses, until the seventies, when the first oil crisis resulted in gasoline shortages and awareness on the dangers of oil dependence.