5 Jan 22

Electric is good, but ethanol seen better in Brazil

While some say that the transition to electric vehicles (EV) is a path toward a more sustainable future as less CO2 emissions are released into the atmosphere, fleet managers and business owners just may want to look toward the option of ethanol when it comes to fleet operations in Brazil.

For more on the fleet and electrification strategies of car manufacturers accross the globe, download the latest Global Fleet e-book on the matter.

According to Wilson Ferreira Junior (pictured above) who is President of Rio de Janeiro based energy company Vibra Energia, 70% of electric energy production is to blame for global emissions worldwide as much of it is produced through the use of coal and fuels such as diesel and gasoline.

This number is only 6% in Brazil as the country focuses more on using natural gas and hydro-powered energy. In fact, 85% of the energy produced in Brazil is renewable, Mr. Ferreira said on local program Roda Viva.

Wilson Ferreira Jr. on Roda Viva (source: TV Cultura)

Although the country’s electricity production is clean, there are still large barriers for the fleet manager. EVs are expensive today, at least double the price of a combustion engine vehicle, and their battery packs are quite heavy (some 500 kilos), thus impacting efficiency. “I feel that we will be using ethanol for quite a long time,” said Mr Ferreira referring to the next 10 years.

The productivity of an ethanol vehicle is quite high, and the executive sees passenger cars and light commercial vehicles (LCV) running on flex power, using both standard gasoline and the sugar-cane based ethanol in Brazil, at least until the end of this decade. For long-haul trucks, he sees bio-methane.

Approximately 20% of Brazil’s fuel is bio-fuel (ethanol or bio-diesel) but it is on the way to reaching 30%, the executive said, adding that an environmentally friendly clean Diesel alternative known as Diesel Verde (HVO) should be on the market by 2026. The process will be started in 2022. 

One drawback today regarding fuel is that the fiscal system on fuel is very complex. Simplification on taxation is needed. 

Hybrid, a likely alternative

One good alternative today could be a hybrid vehicle which is ethanol capable. The first-ever vehicle of this kind worldwide was launched in Brazil (2020 Toyota Corolla hybrid flex).  

By 2030, Mr. Ferreira sees electric vehicle production representing no more than 15% of the market in Brazil with some 3% of vehicle stock being EVs. Most of them (two thirds) should be hybrids. "In the coming years, electric vehicle sales will be incrementally more than today, but I don’t really see any significant change coming to the country, at least in this decade.” said the executive.

However, within the next five years, Mr. Ferreira certainly feels that a more expansive electric recharging network will be available throughout the country. 

Finally, the executive stated that he also expects to see energy stations replacing petrol stations, meaning that they refill vehicles with gasoline and ethanol, but also provide electric and hydrogen recharging. This will not only be available for cars but for other vehicles such as e-bikes and e-scooters, he said.

Top photo: Wilson Ferreira Jr, courtesy of Vibra Energia

Authored by: Daniel Bland