Benefits of the long view

…I was recently in Brazil and my business discussions reminded me of how important it is that countries and their leaders (political, business, religious and others in civil society) take the long view. Today, Brazil is the leading exporter of ethanol and is leading the drive to make this renewable source of energy an easily tradable commodity around the world. By taking the long view on energy independence, Brazil has arrived at this leading and enviable position (today ethanol is being discussed with the same excitement with which the software companies of Silicon Valley were being discussed in the early to mid 1990s). As happens most times with human beings, it was a crisis that forced the long view on Brazil. In 1975, in the middle of the first oil crisis, Brazil was broke and could not afford to import crude oil for its energy needs. Indeed, in the mid-80s I arranged a very large loan facility from the bank with which I worked in Kuwait to the major importer of petroleum products in Brazil for that entity to buy Kuwaiti petroleum products. It was the crisis in the mid-70s that forced Brazil to find a renewable source of energy, which it did in ethanol.

A three-decade-long alternative energy campaign has outfitted Brazilian filling stations with fuel pumps that offer pure ethanol, a blend of gasolene and 10 per cent ethanol called gasohol, or even natural gas. This year, Brazil will achieve energy independence – a goal the United States has been chasing without success since the energy crisis of the 1970s.

A three-decade-long alternative energy campaign has outfitted Brazilian filling stations with fuel pumps that offer pure ethanol, a blend of gasolene and 10 per cent ethanol called gasohol, or even natural gas. This year, Brazil will achieve energy independence – a goal the United States has been chasing without success since the energy crisis of the 1970s.

LONG-TERM POLICY FILLIP

The new excitement surrounding ethanol as a renewable fuel was also precipitated by a major crisis that happened on September 11, 2001. The Renewable Fuels bill that was talked about by President George W. Bush in his State of the Union address earlier this year encapsulates America’s long view on weaning itself from foreign oil – primarily Middle Eastern oil – by turning to a renewable fuel that can be produced in the United States. The current annual demand for ethanol in the United States is about 7.5 billion gallons while about four billion is being produced in America today. It is expected that America will arrive at self sufficiency in ethanol only by about 2012, however, between now and then there will be strong demand in the U.S., Europe and Asia for ethanol. For the first time in a long time the United States has decided to adopt a renewable energy policy that will reduce significantly its need for imported oil. This provides the rest of the world with a great opportunity.

Jamaica Gleaner