Joint venture to source and sell bioethanol from Brazilian sugarcane

According to Greenergy, which expects to supply around half of the UK’s bioethanol this year, traded volumes are likely to exceed 600,000 cubic metres in 2010 and more than double over the next three years.

Much of this increase in demand for bioethanol will be regulation-driven: the UK’s Renewable Transport Fuel Obligation Programme (RTFO) requires that, from this year, five per cent of all fuel sold on UK forecourts comes from a renewable source, while under EU’s Renewable Energy Directive (RED), 10 per cent of all energy used in transport must be renewable by 2020.

The new company, Greenergy Brazil, which is headquartered in Sao Paulo, has been established to meet this increasing demand for bioethanol, while at the same time complying with sustainability and carbon emission standards set down by the RTFO and the RED, the company said.

With the increasing global demand for oil, environmental groups have warned that pressures to increase sugarcane production in Brazil could accelerate deforestation in the Amazon.

Greenergy is keen to point out that since 2007 it has been working with suppliers in Brazil “as part of an ongoing commercial relationship to support them in the implementation of environmental and social sustainability” and has established what it describes as a “gold standard sustainability audit programme” for producers in Brazil.

Greenergy says it has also been working with Bauche Group – which has an established presence in Brazil – for a number of years to establish best practice for suppliers of sustainably sourced and traceable bioethanol for movement into the UK and Europe.

The new joint venture will formalise and expand this collaboration.

“We now have outstanding access to significant volumes of pre-certified product that meets and exceeds RTFO and RED sustainability requirements and are ideally placed to capitalise on growing demand for RED compliant product in Europe,” said Andrew Owens, Greenergy chief executive.

Board director Alexander Bauche added: “Working with Greenergy has enabled us to strengthen our network and to develop the supply infrastructure to guarantee the highest quality sustainable bioethanol from the Brazilian market. 

“Greenergy Brazil is the next step in establishing a secure export market and in expanding our trading position.”