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(continued)
 BRAZIL,
A GLOBAL BENCHMARK
Biodiesel makes Brazil a global benchmark in the use
of renewable fuels. It first won this position in the 1970s with the
introduction of ethanol made from sugarcane to power automotive vehicles.
The National Alcohol Program, Proálcool, was the
largest fossil fuel substitution program in the world automotive market. It is
still considered a global example of excellence, and Brazil remains the largest
producer and consumer of ethnaol fuel in the world.
The experience Brazil has accumulated through the Proálcool serves as a strong
foundation for implementing the biodiesel program and maximizing the nation’s
competitiveness in a relatively short period.
COMPETIVENESS AND SOCIAL INCLUSION
Commercial use of biodiesel in Brazil is governed by
a specific regulatory framework that makes biodiesel competitive with
petrodiesel, taking into account the wide variety of oilseeds available,
measures to guarantee supply, compliance with fuel quality standards, and the
Government’s social inclusion policy.
The regulatory framework is made up of laws and
decrees dealing with biodiesel-diesel percentage blends, forms of use and
taxation. The tax rules include differential rates depending on the oilseeds
used, where they are grown, and whether they are produced by large agribusiness
concerns or family farmers. Biodiesel feedstocks and the fuel itself are
exempted from Industrial Products Tax (IPI).The Program has also instituted a
“Social Fuel” seal.
Guidelines on production of biodiesel and percentage
blends with petrodiesel were established by the CNPE and implemented via two
specific resolutions issued by the National Petroleum Agency (ANP). They
regulate the activities of biodiesel producers, set out specifications for the
new fuel, and establish the distribution portion of the value chain. ANP has
also revised 18 resolutions on liquid fuels to adapt the rules and regulations
in force to the introduction of biodiesel.
The crop area required to produce the blend of 2% of
biodiesel and 98% petrodiesel will be 1.5 million hectares, equivalent to only
1% of the total acreage under crops or available for agriculture throughout
Brazil (150 million hectares).
Biodiesel makes Brazil a global benchmark in the use
of renewable fuels. It first won this position in the 1970s with the
introduction of ethanol made from sugarcane to power automotive vehicles. The
National Alcohol Program, Proálcool, was the largest fossil fuel substitution
program in the world automotive market. It is still considered a global example
of excellence, and Brazil remains the largest producer and consumer of fuel
alcohol in the world.
The experience Brazil has accumulated through the Proálcool serves as a strong
foundation for implementing the biodiesel program and maximizing the nation’s
competitiveness in a relatively short period.
FLEXIBILITY & QUALITY ASSURANCE
The National Biodiesel Production & Use
Program is not restrictive. It allows a wide range of oilseeds grown
in Brazil to be used as feedstocks. The vegetable oil produced by
crushing the seeds can be refined using a variety of technological
routes (including thermal cracking and ethyl or methyl
transesterification). This flexibility enables participation by
agribusiness and family agriculture units, as well as assuring
optimal use of arable land around the country.
Regardless of the oilseed used as feedstock and the technological route,
biodiesel is being introduced into the national fuel market with a single set of
specifications and international qualification. ANP, the National Petroleum
Agency, is responsible for regulatory oversight.
CONSUMER WARRANTY
The blend of 2% of biodiesel with petrodiesel dispenses with the need to
retrofit the conventional diesel engines already in use in Brazil, as is the
case in countries that already use the fuel. In an official letter to the
Government, the National Association of Motor Vehicle Manufacturers Anfavea) has
assured consumers that factory warranties for diesel engines will cover running
on B2.
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