Overview

On April 12, 2006 Governor Bush addressed the growing recognition of the need to diversify fuel supplies due to soaring oil prices and vulnerability to supply disruptions, submitting a detailed nine-page position paper drawn up by Gateway Florida to President Bush, recommending “a comprehensive ethanol strategy for the U.S. and our hemisphere.” The policy advises that the United States will be consuming 15 billion gallons of ethanol annually by the year 2015 (“15 by ’15 Initiative”).

In August 2006, on behalf of Governor Bush, Florida FTAA Executive Director Brian C. Dean led a delegation to Brazil with the objective of strengthening partnerships to advance the Governor’s “15 by ’15” Ethanol Initiative. During this mission it was agreed that Florida and Brazil would work together to create a commission for regional ethanol cooperation. It was decided that Roberto Rodrigues would represent the commission for Brazil, serving as Governor Bush’s counterpart. Bush and Rodrigues then asked for the support of the Inter-American Bank, and Ambassador Moreno agreed to join the commission as the third co-chair.

History of the Formation of the International Biofuels Commission

Background
In 1973 the Organization of Arab Petroleum Exporting Countries (OAPEC) announced that they would no longer ship petroleum to nations that had supported Israel in its conflict with Syria and Egypt. During the same period, OPEC members agreed to use their leverage over the world price-setting mechanism for oil in order to quadruple world oil prices. Taken together, these measures deeply and adversely impacted the United States and many nations around the world, resulting in these countries realizing that they must drastically diminish their dependency on foreign sources of energy. As a result, many of these countries began to turn to agriculture-based renewable energy sources.

United States
In 2005 and 2006, record high gas prices made the United States’ extreme dependency on foreign oil and susceptibility to any disruption in supply truly touch home, and the U.S. became even more aggressive in enacting legislation that mandates renewable fuels sources and in providing incentives for production of these fuels, especially ethanol.

In his 2006 State of the Union Address, President George W. Bush outlined his Advanced Energy Initiative (AEI) to help break America's dependence on foreign sources of energy. He pointed out the necessity of affordable energy to keep America competitive and then stated that we have a problem: “America is addicted to oil, which is often imported from unstable parts of the world.” The President has set a national goal of replacing more than 75% of our oil imports from the Middle East by 2025, and has championed ethanol as one of the principle sources to achieve this goal. He has even been dubbed as ethanol’s “Promoter-in-Chief.”

Brazil
Brazil is one of the world’s largest and most efficient ethanol producer and has managed in the past three decades to create an ethanol market that is competitive with gasoline, leading the country on the path to energy independence. The origin of Brazil’s ethanol history is similar to that of the United States. Like the U.S., Brazil was historically a heavy oil importer, and the oil crises of the 1970s, a time in which Brazil imported about 80% of the oil it consumed, led Brazil to create PROALCOOL, a program to increased ethanol production.

Today, ethanol accounts for more than 40 percent of the gasoline-ethanol market in Brazil, compared to only about 3 percent in the U.S., even though the ethanol programs in the two countries are of similar magnitude. Sugarcane is the dominant feedstock of the Brazilian ethanol industry, and the country has become the lowest-cost sugar producer in the world.

Florida
In April 2006 Governor Jeb Bush of Florida submitted a letter and position paper, which was drawn up by Gateway Florida, Inc., to President Bush, outlining his “15 by ’15” ethanol initiative: A Hemispheric Wide Approach to Ethanol. In the proposal Governor Bush recommends an ambitious energy policy in which the United States will consume 15 billion gallons of ethanol annually by the year 2015. The policy suggests that the U.S. should cooperate with Brazil, the world’s leader in ethanol production and technology, and also reconsider the U.S. policy that taxes ethanol imports.

Governor Bush points out that rarely are policy makers with “win-win” situations on complex issues such as these, but increased ethanol production and diversification presents that sort of situation. “Increasing ethanol use can benefit our environment, strengthen national security and fuel the economic engine of free trade, creating a win-win-win for the United States and Florida,” said Governor Jeb Bush.

Brazil and Florida Partnership Forms
On June 5, 2006, Governor Bush met with Roberto Rodrigues, the former Brazilian Minister of Agriculture. The two discussed the possibilities of a partnership between the State of Florida and the State of Sao Paulo, emphasizing Brazil’s role as a global leader in ethanol technology, production and distribution. “I look forward to seeing what Brazil and Florida can accomplish together by adopting an integrated approach to fuel diversity,” said Minister Rodrigues.

In August of 2006, on behalf of Governor Bush, Gateway Florida Executive Director Brian C. Dean led a delegation to Brazil with the objective of strengthening partnerships to advance the Governor’s “15 by ’15” ethanol initiative. Among the delegation’s priorities were to gain additional knowledge of the Brazilian ethanol industry, its relationship to state and national governments, and its potential to serve, in partnership with the Untied States, as a leader in a policy initiative aimed toward increasing production and consumption of ethanol in the Americas.

During the mission to Brazil, the idea arose of forming a Brazil-Florida commission to promote the expansion of ethanol markets in the Americas. The commission was initially suggested by the Executive Director of the Federation of Industries of the State of Sao Paulo (FIESP) and later by the sugarcane industry association (UNICA) president, Mr. Eduardo Pereira de Carvalho. The idea of a commission became a recurring theme throughout the mission. It was agreed that the commission would form according to the terms of a memorandum of understanding between the various parties, including Florida FTAA, Governor Jeb Bush, pertinent State of Florida institutions, FIESP, UNICA, EMBRAPA (Brazilian agricultural research service), and the University of Sao Paulo (USP-Esalq).