BRAZIL-GERMANY: Kyoto Protocol Gets a Ride in Fuel-Alcohol Car

By Mario Osava Reprint | | Print |

Mario Osava

RIO DE JANEIRO, Aug 22 2002 (IPS) - Germany and Brazil will formalise a project at the World Summit on Sustainable Development, to begin Monday in Johannesburg, that entails production of automobiles in line with the Kyoto Protocol on climate change, announced Foreign Minister Celso Lafer in the Brazilian capital Thursday.

Brazil’s President Fernando Henrique Cardoso and Germany’s Chancellor Gerhardt Schroeder are to sign an initial accord to foment the manufacture in Brazil of 100,000 new cars that run on fuel-alcohol. Ideally, manufacturing will begin before the end of next year, said Lafer.

Cardoso and Schroeder are both planning to participate in the summit, also known as Rio+10, to take place Aug 26-Sep 4 in the northern South African city of Johannesburg.

The project calls for the Brazilian government to grant a sales tax exemption of 1,000 reais (320 dollars) in order to stimulate the purchase of the new vehicles by taxi drivers, car rental agencies and government entities.

The costs of the tax incentive, totalling some 100 million reais (32 million dollars), are to be covered by the German government.

The aim is to curb emissions of carbon dioxide, which is produced in the combustion of gasoline and other fossil fuels and leads to the so-called greenhouse effect, the cause of global warming.

With this initiative, Germany and Brazil are putting into practice the Clean Development Mechanism of the Kyoto Protocol, an international treaty that sets targets for reducing emissions of gases that cause climate change.

Germany’s financial contribution will not be a donation, but rather represents the acquisition of credits to be included in future calculations to determine whether the European nation has met its greenhouse-gas-reduction targets, as stipulated by the Protocol.

The 100,000 new vehicles in Brazil will require an estimated annual supply of 430 million litres of alcohol, for 10 years, which is considered the productive life of the car.

The demand for fuel could spark a re-launch of an alcohol production programme that Brazil began in the 1970s to overcome the need for imported petroleum. But the programme has been on the decline for more than a decade due to relatively low gasoline prices and the uncertainty surrounding fuel-alcohol supplies.

Cars that run on alcohol, which at one point represented more than 90 percent of Brazil’s total car manufacturing output, today do not reach even 0.1 percent of the total number of vehicles in circulation.

Producers of sugarcane — used in the production of fuel- alcohol — have been clamouring for a reactivation of the Proalcohol initiative, even as a measure to stabilise sugar prices.

Now the sugarcane growers may see the greenhouse effect and the Kyoto Protocol as their allies. The agreement with Germany will allow them to expand production, create jobs, and tag more sugarcane for distillation, thus preventing a surplus on the sugar market.

The Kyoto Protocol was approved in 1997, but will only enter into effect when enough countries — whose greenhouse gas emissions add up to 55 percent of the total world output — have ratified it.

It has proven a difficult target, given that the United States has withdrawn from the treaty, and alone is responsible for 25 percent of emissions.

With the new Brazil-Germany project, the two nations confirm their intentions to hold world leadership positions on environmental questions.

Brazil will present other initiatives as well at the Johannesburg Summit, including one that calls on all countries to achieve renewable energy production equal to 10 percent of total national consumption by the year 2010.

The European Union, with Germany in the lead, has implemented a similar programme, so is expected to back the Brazilian proposal, already approved by the rest of Latin America and the Caribbean.

Fuel-alcohol could be an important tool for achieving the objective of 10 percent renewable energy sources. With its experience, technology and low production costs, Brazil could become a major exporter of this fuel.

China, India and Japan have already expressed interest in replacing petroleum-based fuels with alcohol, says Sergio Amaral, Brazil’s Minister of Development, Industry and Foreign Trade.

The Cardoso government enacted several environmental measures Thursday, leading observers to believe the president is trying to strengthen the country’s position going into the Johannesburg Summit.

Cardoso formalised the National Biodiversity Policy, a plan resulting from broad public debate, and decreed the creation of Tumucumaque National Park, considered the world’s largest reserve of protected tropical forest, located in the northern state of Amapá.

In Congress, meanwhile, lawmakers are considering to legislative bills that would stiffen penalties for environmental crimes, particularly bio-piracy, and improve management of Brazil’s extensive genetic wealth.

Cardoso said that he will make an appeal at the World Summit on Sustainable Development for wealthy countries to contribute more towards the protection of Brazil’s natural resources, given that this South American giant’s biodiversity and Amazon forests are vital for the health of the entire planet.

Because of its efforts and initiatives, Brazil is qualified to play a global leadership role when it comes to environmental issues, said the president.