Editing IPCC:AR6/SR15/Chapter-4 (section)

== Box 4.7: Bioethanol in Brazil: Innovation and Lessons for Technology Transfer ==

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The use of sugarcane as a bioenergy source started in Brazil in the 1970s. Government and multinational car factories modified car engines nationwide so that vehicles running only on ethanol could be produced. As demand grew, production and distribution systems matured and costs came down (Soccol et al., 2010) <sup>[[#fn:r1283|1283]]</sup> . After a transition period in which both ethanol-only and gasoline-only cars were used, the flex-fuel era started in 2003, when all gasoline was blended with 25% ethanol (de Freitas and Kaneko, 2011) <sup>[[#fn:r1284|1284]]</sup> . By 2010, around 80% of the car fleet in Brazil had been converted to use flex-fuel (Goldemberg, 2011; Su et al., 2015) <sup>[[#fn:r1285|1285]]</sup> .

More than forty years of combining technology push and market pull measures led to the deployment of ethanol production, transportation and distribution systems across Brazil, leading to a significant decrease in CO <sub>2</sub> emissions (Macedo et al., 2008) <sup>[[#fn:r1286|1286]]</sup> . Examples of innovations include: (i) the development of environmentally well-adapted varieties of sugarcane; (ii) the development and scaling up of sugar fermentation in a non-sterile environment, and (iii) the development of adaptations of car engines to use ethanol as a fuel in isolation or in combination with gasoline (Amorim et al., 2011; de Freitas and Kaneko, 2011; De Souza et al., 2014) <sup>[[#fn:r1287|1287]]</sup> . Public procurement, public investment in R&amp;D and mandated fuel blends accompanying these innovations were also crucial (Hogarth, 2017) <sup>[[#fn:r1288|1288]]</sup> . In the future, innovation could lead to viable partial CO <sub>2</sub> removal through deployment of BECCS associated with the bioethanol refineries (Fuss et al., 2014; Rochedo et al., 2016) <sup>[[#fn:r1289|1289]]</sup> (see Section 4.3.7).

Ethanol appears to reduce urban car emission of health-affecting ultrafine particles by 30% compared to gasoline-based cars, but increases ozone (Salvo et al., 2017) <sup>[[#fn:r1290|1290]]</sup> . During the 1990s, when sugarcane burning was still prevalent, particulate pollution had negative consequences for human health and the environment (Ribeiro, 2008; Paraiso and Gouveia, 2015) <sup>[[#fn:r1291|1291]]</sup> . While Jaiswal et al. (2017) <sup>[[#fn:r1292|1292]]</sup> report bioethanol’s limited impact on food production and forests in Brazil, despite the large scale, and attribute this to specific agro-ecological zoning legislation, various studies report adverse effects of bioenergy production through forest substitution by croplands (Searchinger et al., 2008) <sup>[[#fn:r1293|1293]]</sup> , as well as impacts on biodiversity, water resources and food security (Rathore et al., 2016) <sup>[[#fn:r1294|1294]]</sup> . For new generation biofuels, feasibility and life cycle assessment studies can provide information on their impacts on environmental, economic and social factors (Rathore et al., 2016) <sup>[[#fn:r1295|1295]]</sup> .

Brazil and the European Union have tried to replicate Brazil’s bioethanol experience in climatically suitable African countries. Although such technology transfer achieved relative success in Angola and Sudan, the attempts to set up bioethanol value chains did not pass the phase of political deliberations and feasibility studies elsewhere in Africa. Lessons learned include the need for political and economic stability of the donor country (Brazil) and the necessity for market creation to attract investments in first-generation biofuels alongside a safe legal and policy environment for improved technologies (Afionis et al., 2014; Favretto et al., 2017) <sup>[[#fn:r1296|1296]]</sup> .

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Funding for R&amp;D could come from various sources, including the general budget, energy or resource taxation, or emission trading schemes (see Section 4.4.5). Investing in climate-related R&amp;D has as an additional benefit of building capabilities to implement climate mitigation and adaptation technologies (Ockwell et al., 2015) <sup>[[#fn:r1297|1297]]</sup> . Countries regard innovation in general and climate technology specifically as a national interests issue and addressing climate change primarily as being in the global interest. Reframing part of climate policy as technology or industrial policy might therefore contribute to resolving the difficulties that continue to plague emission target negotiations  (Faehn and Isaksen, 2016; Fischer et al., 2017; Lachapelle et al., 2017) <sup>[[#fn:r1298|1298]]</sup> .

Climate technology transfer to emerging economies has happened regardless of international treaties, as these countries have been keen to acquire them, and companies have an incentive to access emerging markets to remain competitive (Glachant and Dechezleprêtre, 2016) <sup>[[#fn:r1299|1299]]</sup> . However, the complexity of these transfer processes is high, and they have to be conducted carefully by governments and institutions (Favretto et al., 2017) <sup>[[#fn:r1300|1300]]</sup> . It is noticeable that the impact of the EU emission trading scheme (EU ETS) on innovation is contested; recent work (based on lower carbon prices than anticipated for 1.5°C-consistent pathways) indicates that it is limited (Calel and Dechezleprêtre, 2016) <sup>[[#fn:r1301|1301]]</sup> , but earlier assessments (Blanco et al., 2014) <sup>[[#fn:r1302|1302]]</sup> indicate otherwise.

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