Reuters reports that BP’s chief executive for biofuels, Mario Lindenhayn has said that the latest biofuels policy in Brazil has improved the outlook for ethanol production.
Brazil expects that by 2020 its policy, RenovaBio will be enacted. The policy should face no obstacles and won’ be stopped by the government of President-elect Jair Bolsonaro, Lindenhayn predicts. BP’s Lindenhayn told Reuters, “We are very positive. This is a very important signal the country is giving, creating a stable regulatory environment that will allow companies to invest.”
The RenovaBio policy will instruct distributors to steadily increase the amount of biofuels that they sell. As a result, by 2030 the use of ethanol should be doubled from around 26 million litres to 52 million. Targets to increase the use of other renewables, such as biodiesel are also included in the policy.
According to Reuters, last year BP joined Brazil’s leading global ethanol seller, Copersucar to operate a large fuel terminal located in Paulínia in Sao Paulo state. BP own three ethanol mills in Brazil and between them they crush ten million tonnes of sugar cane a year.
Lindenhayn informed Reuters that the policy focuses on providing opportunity for Brazilian Mills that have experienced stagnation due to years of low sugar prices as well as long periods of subsidised gasoline prices. Both factors led to the closure of firms and mills. He said, “If the programme advances as planned, it will be a large opportunity. There are no greenfield projects around, and the country is a net fuel importer.”