Ethanol - boon or bust?

South African farmer Hannes Haasbroek flew home from an agriculture conference in the United States six years ago, inspired by the novel and potentially lucrative idea of distilling maize into bioethanol fuel for vehicles.

Haasbroek's friends laughed at him; some called it a crazy idea. But in little more than a year, South Africa's first billion-dollar bioethanol factory will be pumping out 500,000 litres of the liquid fuel every day. Seven more of the enormous factories are planned for sites across the country.

"Sure they thought it was an idea that wouldn't work - they didn't understand it. But since the price of oil has gone up by so much, and ethanol is in higher demand, many farmers I've talked to want to do exactly what I'm doing," Haasbroek said with a smile.

The fertile fields that appear to stretch unbroken across Free State Province, South Africa's heartland and breadbasket, may well prove the epicentre of an economic revolution as significant as the discovery of gold and diamonds more than 100 years earlier.

The plan is deceptively simple: turn food into fuel.

Bioethanol is an alcohol refined from almost any starch crop humans eat - maize, sugar cane, beetroot, wheat - and is championed by supporters as both an environmental and economic panacea to the world's dependence on fast-disappearing fossil fuels.

Ethanol emits much less carbon dioxide (CO2) gas than regular gasoline, is cheaper to buy and, unlike oil or coal, is a renewable source of energy: simply plant more of it if you run out.

The reigning kings of the global biofuel industry are the United States and Brazil, where millions of tons of sugar - a staple crop in the South American country - are processed into an astonishing 16 billion litres of ethanol annually.

Brazilians are literally driving on sugar. Most of Brazil's service stations offer ethanol at a substantially lower price than traditional gasoline, and the country has replaced about 40 percent of its gasoline consumption by switching to ethanol, a sweet dividend with oil prices hovering around US$70 a barrel.

World ethanol production has rocketed from about 550 million litres a year in 1975 to more than 30 billion annually, and though Africa is a latecomer to the biofuel party, it hopes to make a big splash when it finally arrives.

"Africans have the potential to become the Arabs of the biofuel industry," said Johan Hoffman, chief executive of Ethanol Africa, the company that plans to build eight biofuel factories across South Africa.

"There is a potential to use vast areas of this massive continent for biofuel production, and all that is needed is water and an electricity supply," Hoffman said. "Africa has the potential to provide energy for the world - who is going to supply the growing economies of China and India? We already know there is a finite amount of oil left in the earth, and it is being used in enormous quantities and will soon be gone."

While bioethanol might be the tonic that quenches the world's thirst for energy, it also holds the promise of bettering the lives of thousands of poor, rural Africans by providing farm and factory jobs, and ensuring a steady market for maize, sugar and other commodities.

"The [South African] government wants to create jobs in rural areas and redistribute land from white to black farmers, and bioethanol production could be the solution to both problems," Hoffman said. "Bioethanol will create jobs, not just for the farming industry, but for whole communities, and uplift the poor."

With unemployment estimated at 40 percent and a farming industry that could theoretically triple in size from 1.5 million to 4.5 million hectares, South Africa could be the ideal environment for a vast bioethanol industry.

Ethanol Africa, which will list on a British stock exchange in November, said it hoped to source 30 percent of its maize from small-scale farmers and buy whatever they brought for sale - a tonne, a half-tonne, or even a single bag - at prices set before the planting season, ensuring a steady income for farmers.

The company, formed by a group of farmers and agronomists, is already exploring the possibility of building ethanol factories in countries like Angola and Zambia.


Those touting the benefits of bioethanol also claim the fuel is a boon to the environment.

Since the signing of the Kyoto accord on greenhouse gases and global warming, many countries have begun programmes to blend ethanol into gasoline - known as 'gasohol' - in an effort to reduce the amount of CO2 released into the atmosphere.

The mandatory ethanol content for any gasoline is 20 percent in Brazil; the European Union recently introduced a mandatory 5 percent level, and Sweden boasts the world's biggest ethanol bus fleet.

In South Africa, which imports about 60 percent of its crude oil requirements, ministers are discussing the introduction of a 10 percent mandatory ethanol blend.

"The reason for blending ethanol is not only about the high price of oil, but the world also wants environmentally friendly solutions to the problems of energy use, and ethanol releases about 60 percent less CO2 than petrol," Hoffman said.

A renewable energy that will create jobs, reduce dependence on fossil fuels, help the environment and uplift the poor - is there anything ethanol can't do?

A lot, say its detractors. "I wish they would stop building these ethanol factories," said the University of Cape Town's Dr Harro Von Blottnitz, a chemical engineer who has spent years studying biofuels in African contexts.

"It is well documented - it takes energy to make energy, and the amount of energy it takes to grow and harvest these crops barely produces a surplus return," he said. "While bioethanol production makes some sense with high oil prices, I don't think our government has wrapped its mind around all the consequences, and studies that should be done, haven't been done."

Scientific debate rages around the process and results of transforming food into fuel, with many saying the numbers simply don't add up.

Ethanol distilled from sugar gives a decent energy return, but add up all the energy it takes to grow a field of maize, and the amount you get back is barely more than you put in, critics say. Besides that, biofuel is much less efficient than regular fuel, so even if it is cheaper to buy, it will not move your vehicle nearly as far.

Von Blottnitz uses the example of solar panels to demonstrate a more efficient way of obtaining energy. "Instead of planting maize on a hectare of land and making ethanol from that maize, if you laid the field with photovoltaic panels you would obtain 200 times the amount of energy in the form of solar energy," he said.

How much maize is needed to move a car, a truck, or a fleet of buses? A hectare of land - 1 or about the size of two football fields - yields an average of 4 tonnes of maize. Each tonne of maize can be distilled into 420 litres of bioethanol, plus some ancillary products. The two football fields would thus produce about 1,680 litres of ethanol.

According to a report in the Washington Post newspaper, the entire American maize crop would provide enough ethanol fuel to replace only about 12 percent of the country's gasoline requirements.

"The grain required to fill a 25-gallon (about 114 litres) SUV [sports utility vehicle] gas tank with ethanol will feed one person for a year," said Lester Brown of the Earth Policy Institute in a statement. "The grain it takes to fill the tank every two weeks over a year will feed 26 people ... The 55 million tons (about 50 million tonnes) of US corn going into ethanol this year represent nearly one-sixth of the country's grain harvest, but will supply only 3 percent of its automotive fuel."

While some bristle at the idea of the poor and hungry competing with luxury all-terrain vehicles for the world's supply of grain, Ethanol Africa says it will use only yellow maize in its factories, and not the white maize favoured by consumers.

Environmentalists, who have resisted blindly embracing bioethanol as a viable answer to energy supplies, have raised other concerns. Biowatch South Africa, an NGO concerned with food security and promoting organic farming methods, reels at the bioethanol industry's dependence on genetically modified (GM) crops in South Africa.

"Small-scale farmers are adopting GM crops, and once they do they become dependent on the markets and forget about their own food security," said Biowatch Director Leslie Liddell. "By and large, those farmers don't understand the contracts they sign with multinationals supplying the seeds. They are not allowed to replant the seeds because of copyright laws. These companies are beginning to own our agricultural systems, and farmers are no longer storing their seeds."

In the small town of Bothaville in South Africa's Free State province, the foundations for the country's first bioethanol factory are being laid on a sprawling 30-hectare site, with the full backing of local government. Production is expected to begin in about a year.

"The whole bioethanol revolution will save maize farmers in South Africa," farmer Haasbroek said. "Because if it wasn't for this technology many thousands would go bankrupt, many would give up farming altogether."