Wind and biofuels will boost the already sizeable renewable energy sector.

Famous for its verdant rain forest and sunsoaked beaches, Brazil is less well-known as a superpower of renewable energy. Yet, that’s what it is.

83% of Brazil’s power comes from renewable sources — one of the highest levels of any large economy.

It’s an impressive feat. Yet Brazil’s planners recognize they’ll have to repeat the success, and then some, as energy supplies are stretched. The population is expected to rise by 15 million this decade, to 205 million.

As a result, a number of important trends have emerged:

• Brazil is on track to become the world’s fourth largest economy by 2030 and aims to meet rising energy demand by expanding a long-established commitment to renewable sources.
• With new sources of hydropower constrained, wind power has become a top priority and is on track to grow sevenfold to 22GW by 2020.
• Already the world’s number two producer of ethanol, Brazil’s rising vehicle ownership will help spur ethanol output to grow by 10% per year this decade.
• Long term, Brazil’s ethanol producers may find export potential in the US, which dropped tariff barriers to ethanol imports last year.
• As Brazil’s conventional petroleum sector booms, competition is growing for many of the human resources, raw materials and capital goods that renewables developers will also need.

Wind power and biofuel are expected to lead Brazil’s renewables investment.

Wind

While large-scale hydropower development continues — the 11.2 gigawatt (GW) Belo Monte on the River Xingu in the Amazonian state of Pará is slated to come online in 2015 — planners are intent on diversifying Brazil’s generating capacity to include wind.

Brazil wind generation — cumulative capacity (MW)

Source: Brazilian Wind Energy Association

Indeed, green as Brazil’s grid may be today, there’s growing consensus that needs exceed the potential of new hydropower.

National energy plans call for additions of more than 60 GW of generating capacity through 2020. Though wind provides less than 1% of electric supply today, the plan could take its share up to 7% in short order.

Despite estimates of total wind energy potential of some 350GW, just 1.5GW was online by the start of 2012. That total is expected to more than double to 3.2GW this year. Come 2020, the total should hit 22GW, according to the Brazilian Wind Energy Association.

Biofuels

Brazil’s green transformation of its vehicle fl eet ranks as one of the most successful such efforts ever.

Three decades after calling for ethanol to substitute for a fourth or more of every gallon of gasoline sold carmakers have equipped vehicles to handle ethanol blends of up to 85%. The result is that Brazil has achieved the world’s highest penetration of biofueled vehicles.

Brazilian ethanol production (2011–2011)

Source: EIA, International Energy Statistics; USDA

Overall, ethanol accounts for about 40% of the fuel that Brazilians pump into their cars, according to the World Resources Institute. In the US, the comparable figure stands at just 3%.

Biofuel production, including a small but growing share of biodiesel, is expected to expand by 9.7% annually in the decade through 2021, according to Pike Research, with ethanol output reaching 61 billion liters per year. This volume is likely to exceed domestic demand by that time, Pike predicts.

Outlook

Given past success with hydroelectric power and biofuel, Brazil has built a precedent for success with renewable energy. Coupled with a manifest need for new energy supplies, Brazil is a good bet to achieve even greater, greener energy goals.

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