Biofuels and Sustainable Energy Development in Brazil

SummaryThrough the assessment of three decades of the Alcohol Program in Brazil, the paper shows that adequate public policies regarding biomass production can deliver direct benefits like energy security improvement, foreign exchange savings, and local employment generation, reduced urban air pollution and avoided CO2 emissions. Moreover, the paper shows that Brazilian produced ethanol has faced economies of scale, technical progress and productivity gains and is no longer dependent on subsidies to be competitive. The paper also examines the potential in Brazil for fostering other biofuels, namely biodiesel obtained from vegetable oils, as well as their implications on sustainable energy development.