Thursday, September 29, 2005

Australia's lost ethanol opportunity

A couple of years ago, there was a plan to introduce broad scale ethanol blended fuel Australia wide. The plan hit a hiccup because there was just not enough domestic industrial production of ethanol in Aus. One avenue open was to import ethanol from Brazil as a stopgap until such time as local production could increase. However the (local) sugarcane lobby was feared by the government and the whole project got put in the back-burner. Because blended fuel then became a niche, car problems started being blamed on ethanol. This would not have happened if we had started to import heavily from Brazil. The sugar price may well have increased with the extra demand from cars, helping our farmers. We could be importing ethanol technologies while exporting sugar cane technologies.

1 comment:

Dr. Clam said...

This may be a few years out of date, but the last time I looked into biofuels seriously ethanol was only successful with heavy government subsidy (i.e., middle and upper class welfare) and that oilseed-based biodiesel was a more economic proposition. The price of petrol will need to triple to make it worthwhile- I suppose there is an argument that it is worth putting money in now to angle for market share then, but we have a very small area under sugar cane by world standards and I doubt we will have the economies of scale to be competitive there...
And, as long as the large energy input needed to extract ethanol from water is derived from fossil fuels, we would get very little environmental bang for our buck out of using ethanol.