Brazilian ethanol promotional event cancelled

By Holly Jessen | May 21, 2010
Posted May 25, 2010

It isn't clear exactly who or how, but a promotional event to promote Brazilian ethanol and call attention to the 54 cent tariff was abruptly canceled a week before it was scheduled to occur.

UNICA, the Brazilian Sugarcane Industry Association, had planned to give Washington-area residents a discount of 54 cents per gallon on Memorial Day at two Exxon stations on Capitol Hill. The event was cancelled one week after it was approved by Capitol Petroleum Group and less than 24 hours after the company approved the hanging of promotional banners on its property. A Capitol Petroleum Group representative told UNICA the plug was pulled due to "unspecified political reasons," UNICA said.

"Open market competition and free speech are two fundamental principles that have made the United States a global leader," said Joel Velasco, UNICA's chief representative in North America. "It's a shame that those values don't seem to apply in this situation."

While U.S. ethanol industry groups like the Renewable Fuels Association and Growth Energy haven't exactly come out and said they're relieved the event was cancelled, they certainly didn't support it. Growth Energy CEO Tom Buis pointed out that homegrown ethanol creates jobs in the U.S., bolsters the economy and helps reduce the nation's dependence on foreign energy. "The truth is that we have to end our reliance on foreign energy—period," he said.

The same day that UNICA announced the event had been cancelled, the RFA posted a press release at its website, calling the UNICA event a publicity stunt. "Brazil is spending millions of dollars to mislead Americans that its ethanol is superior to the ethanol produced here at home in the United States," the news release said, adding that the information is untrue and deceptive.

In fact, RFA said, at current prices, gas mixed with 10 percent U.S. ethanol would be 11 cents cheaper than a gallon of gas mixed with sugarcane ethanol from Brazil. Even if the 54 cent tariff were removed, E10 with sugarcane ethanol from Brazil would still be 6 cents per gallon more expensive than E10 with ethanol made domestically.

"The facts are clear: using domestically-produced ethanol saves drivers money while supporting jobs and local economies here in the U.S.," said Renewable Fuels Association President Bob Dinneen. "Rather than seeking to cannibalize this market, Brazil should be working with the U.S. to expand the use of ethanol globally to displace reliance on petroleum. Unfortunately, Brazil's singular focus on tapping into American taxpayer wallets impedes such efforts."

Disappointed that the event was cancelled, UNICA is now offering $5 gas cards—double to members of the military—to people that live and work within 25 miles of the Capitol Hill district. The organization is asking people to sign up at http://sweeteralternative.com, the website promoting Brazilian ethanol as part of the solution to make the U.S. less dependent on oil from the Middle East.