By LARRY ROHTER, New York Times Published: April 10, 2006 PIRACICABA, Brazil — At the dawn of the automobile age, Henry Ford predicted that "ethyl alcohol is the fuel of the future." With petroleum about $65 a barrel, President Bush has now embraced that view, too. But Brazil is already there. This country expects to become energy self-sufficient this year, meeting its growing demand for fuel by increasing production from petroleum and ethanol. Already the use of ethanol, derived in Brazil from sugar cane, is so widespread that some gas stations have two sets of pumps, marked A for alcohol and G for gas. In his State of the Union address in January, Mr. Bush backed financing for "cutting-edge methods of producing ethanol, not just from corn but wood chips and stalks or switch grass" with the goal of making ethanol competitive in six years. But Brazil's path has taken 30 years of effort, required several billion dollars in incentives and involved many missteps. While not always easy, it provides clues to the real challenges facing the United States' ambitions. Brazilian officials and scientists say that, in their country at least, the main barriers to the broader use of ethanol today come from outside. Brazil's ethanol yields nearly eight times as much energy as corn-based options, according to scientific data. Yet heavy import duties on the Brazilian product have limited its entry into the United States and Europe. Brazilian officials and scientists say sugar cane yields are likely to increase because of recent research. "Renewable fuel has been a fantastic solution for us," Brazil's minister of agriculture, Roberto Rodrigues, said in a recent interview in São Paulo, the capital of São Paulo State, which accounts for 60 percent of sugar production in Brazil. "And it offers a way out of the fossil fuel trap for others as well." Here, where Brazil has cultivated sugar cane since the 16th century, green fields of cane, stalks rippling gently in the tropical breeze, stretch to the horizon, producing a crop that is destined to be consumed not just as candy and soft drinks but also in the tanks of millions of cars. The use of ethanol in Brazil was greatly accelerated in the last three years with the introduction of "flex fuel" engines, designed to run on ethanol, gasoline or any mixture of the two. (The gasoline sold in Brazil contains about 25 percent alcohol, a practice that has accelerated Brazil's shift from imported oil.) But Brazilian officials and business executives say the ethanol industry would develop even faster if the United States did not levy a tax of 54 cents a gallon on all imports of Brazilian cane-based ethanol. With demand for ethanol soaring in Brazil, sugar producers recognize that it is unrealistic to think of exports to the United States now. But Brazilian leaders complain that Washington's restrictions have inhibited foreign investment, particularly by Americans. As a result, ethanol development has been led by Brazilian companies with limited capital. But with oil prices soaring, the four international giants that control much of the world's agribusiness — Archer Daniels Midland, Bunge and Born, Cargill and Louis Dreyfuss — have recently begun showing interest. Brazil says those and other outsiders are welcome. Aware that the United States and other industrialized countries are reluctant to trade their longstanding dependence on oil for a new dependence on renewable fuels, government and industry officials say they are willing to share technology with those interested in following Brazil's example. "We are not interested in becoming the Saudi Arabia of ethanol," said Eduardo Carvalho, director of the National Sugarcane Agro-Industry Union, a producer's group. "It's not our strategy because it doesn't produce results. As a large producer and user, I need to have other big buyers and sellers in the international market if ethanol is to become a commodity, which is our real goal." The ethanol boom in Brazil, which took off at the start of the decade after a long slump, is not the first. The government introduced its original "Pro-Alcohol" program in 1975, after the first global energy crisis, and by the mid-1980's, more than three quarters of the 800,000 cars made in Brazil each year could run on cane-based ethanol. But when sugar prices rose sharply in 1989, mill owners stopped making cane available for processing into alcohol, preferring to profit from the hard currency that premium international markets were paying. Brazilian motorists were left in the lurch, as were the automakers who had retooled their production lines to make alcohol-powered cars. Ethanol fell into discredit, for economic rather than technical reasons. Consumers' suspicions remained high through the 1990's and were overcome only in 2003, when automakers, beginning with Volkswagen, introduced the "flex fuel" motor in Brazil. Those engines gave consumers the autonomy to buy the cheapest fuel, freeing them from any potential shortages in ethanol's supply. Also, ethanol-only engines can be slower to start when cold, a problem the flex fuel owners can bypass. "Motorists liked the flex-fuel system from the start because it permits them free choice and puts them in control," said Vicente Lourenço, technical director at General Motors do Brasil. Today, less than three years after the technology was introduced, more than 70 percent of the automobiles sold in Brazil, expected to reach 1.1 million this year, have flex fuel engines, which have entered the market generally without price increases. "The rate at which this technology has been adopted is remarkable, the fastest I have ever seen in the motor sector, faster even than the airbag, automatic transmission or electric windows," said Barry Engle, president of Ford do Brasil. "From the consumer standpoint, it's wonderful, because you get flexibility and you don't have to pay for it." Yet the ethanol boom has also brought the prospect of distortions that may not be as easy to resolve. The expansion of sugar production, for example, has come largely at the expense of pasture land, leading to worries that the grazing of cattle, another booming export product, could be shifted to the Amazon, encouraging greater deforestation. Industry and government officials say such concerns are unwarranted. Sugar cane's expanding frontier is, they argue, an environmental plus, because it is putting largely abandoned or degraded pasture land back into production. And of course, ethanol burns far cleaner that fossil fuels. Human rights and worker advocacy groups also complain that the boom has led to more hardships for the peasants who cut sugar cane. "You used to have to cut 4 tons a day, but now they want 8 or 10, and if you can't make the quota, you'll be fired," said Silvio Donizetti Palvequeres, president of the farmworkers union in Ribeirão Preto, an important cane area north of here. "We have to work a lot harder than we did 10 years ago, and the working conditions continue to be tough." Producers say that problem will be eliminated in the next decade by greater mechanization. A much more serious long-term worry, they say, is Brazil's lack of infrastructure, particularly its limited and poorly maintained highways. Ethanol can be made through the fermentation of many natural substances, but sugar cane offers advantages over others, like corn. For each unit of energy expended to turn cane into ethanol, 8.3 times as much energy is created, compared with a maximum of 1.3 times for corn, according to scientists at the Center for Sugarcane Technology here and other Brazilian research institutes. "There's no reason why we shouldn't be able to improve that ratio to 10 to 1," said Suani Teixeira Coelho, director of the National Center for Biomass at the University of São Paulo. "It's no miracle. Our energy balance is so favorable not just because we have high yields, but also because we don't use any fossil fuels to process the cane, which is not the case with corn." Brazilian producers estimate that they have an edge over gasoline as long as oil prices do not drop below $30 a barrel. But they have already embarked on technical improvements that promise to lift yields and cut costs even more. In the past, the residue left when cane stalks are compressed to squeeze out juice was discarded. Today, Brazilian sugar mills use that residue to generate the electricity to process cane into ethanol, and use other byproducts to fertilize the fields where cane is planted. Some mills are now producing so much electricity that they sell their excess to the national grid. In addition, Brazilian scientists, with money from São Paulo State, have mapped the sugar cane genome. That opens the prospect of planting genetically modified sugar, if the government allows, that could be made into ethanol even more efficiently. "There is so much biological potential yet to be developed, including varieties of cane that are resistant to pesticides and pests and even drought," said Tadeu Andrade, director of the Center for Sugarcane Technology. "We've already had several qualitative leaps without that, and we are convinced there is no ceiling on productivity, at least theoretically."

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FOR IMMEDIATE RELEASE APRIL 17, 2006 11:03 AM CONTACT: Environmental Working Group Bill Walker, EWG, (510) 444-0973, ext. 301 Tracy Fairchild, office of Sen. Jackie Speier, (916) 651-4008 Bush Plan To Hide Data on 1.5M Lbs. of Toxic Chemicals in California State Legislation Would Protect Californians' Right to Know About Pollution in Their Communities SACRAMENTO - April 17 - A Bush Administration proposal to roll back Americans' right to know about chemical hazards in their neighborhoods would let California industries handle almost 1.5 million pounds of toxic chemicals a year without telling the public, according to an investigation of federal data by Environmental Working Group (EWG). Currently, the U.S. Environmental Protection Agency's Toxics Release Inventory (TRI) program requires industrial facilities to report annually the release, disposal, incineration, treatment or recycling of 500 pounds or more of 650 chemicals covered by the law. But last fall the EPA proposed sharply raising the reporting threshhold so that only releases of 5,000 pounds or more would be reported, and reports would only be required every other year. "The right to know what hazardous chemicals are coming out of the smokestack across the street from your child's school is essential," said EWG Vice President Bill Walker. "The Administration's proposal makes it easier for industries to pollute our communities with hazardous chemicals—in secret." EWG's report, "Stolen Inventory," lists all facilities in California that would be allowed to stop or cut back on reporting chemical releases, broken down by county, city and chemical. It is available at www.ewg.org. EPA will announce later this year whether it plans to adopt the proposed rollback. But two California legislators, Sen. Jackie Speier of San Francisco/San Mateo and Assemblymember Ira Ruskin of Redwood City, have introduced bills to establish a state-level TRI, to ensure that complete reporting of toxic chemical releases would continue. Speier's bill (SB 1478) will be heard at 1:30 p.m. today by the Senate Environmental Quality Committee, and Ruskin's (AB 2490) will be heard at 9:30 a.m. Tuesday by the Assembly Environmental Safety and Toxic Materials Committee. "Californians' right to know about the dangerous chemicals to which they are exposed is in jeopardy," said Speier. "Since 1988, the public's access to information in the federal Toxics Release Inventory has given industry the incentive to cut emissions—by 65 percent to date—and helped local communities remove toxic manufacturing plants from their neighborhoods. We must protect Californians' access to this powerful tool." EWG's investigation found that the EPA rollback would deal a crippling blow to Californians' access to information about toxic chemicals in their communities: The rollback would allow 384 industrial facilities to stop reporting the use or release of 1,449,479 pounds of hazardous chemicals a year. In Los Angeles County alone, 629,328 pounds of chemicals a year, from 160 facilities, would no longer be subject to reporting. The proposal would allow 101 facilities to stop reporting any use or release of toxic chemicals. These facilities would be allowed to handle 249,433 pounds of toxic chemicals a year without public disclosure. In Los Angeles County alone, 44 facilities that in 2003 handled 93,975 pounds of chemicals would no longer be subject to reporting. Chemicals for which reporting would be slashed or curtailed are among the most hazardous to human health. The rollback would end annual reporting in California of more than 64,000 pounds of ethylbenzene, 62,000 pounds of styrene, almost 30,000 pounds of benzene and more than 56,000 pounds of chromium and chromium compounds—all known or suspected carcinogens. Although facilities in 37 counties would be allowed to cut back or curtail reporting, a study by Environment California and the National Environmental Trust found that the rollback would hit Los Angeles particularly hard. Communities in more than 90 zip codes in Los Angeles County would lose some or all of the publicly reported pollution information about chemical releases in their neighborhoods. The EWG report is based on TRI figures from 2003. Just last week, the EPA released the 2004 TRI, which showed an 18 percent overall decrease in toxic releases in California. The EPA said the "TRI helps all of us—regulators, emergency responders, businesses and communities—remain aware of the types and amounts of chemicals being used"—even as they are considering the proposal to roll back reporting requirements. "Requiring facilities to report their pollution through the TRI program creates an incentive for them to reduce their pollution," said Rachel Gibson, Environment California staff attorney. "Without a strong TRI program, the incentive is gone." The TRI is the nation's premiere pollution reporting and citizens' right-to-know program. The TRI is the only source of chemical-specific information on industrial pollution at the facility level. It is an essential source of information for public health officials, emergency responders, planners, and a powerful tool for grassroots community groups fighting pollution in their neighborhoods. In Los Angeles, Communities for a Better Environment (CBE) used TRI data to show that more than 80 percent of facilities that release toxic chemicals in L.A. County were located in areas where a large majority of residents were people of color. Three industrial recycling facilities relocated to appropriately zoned areas, and the South Coast air quality district guidelines to ensure that diverse community voices are heard in regulatory decisions. In Oakland, the Chester Street Block Club Association, Citizens for West Oakland Revitalization and Greenaction used TRI data in a campaign against Red Star Yeast, whose plant was emitting tens of thousands of pounds of acetaldehyde, a carcinogen, into the neighborhood's air. The community pressured authorities to fine Red Star for pollution violations and fought against renewal of the plant's operating permit, prompting the company to shut it down.