Gasoline pricing systems and the attractiveness of high-ethanol blends : The cases of Brazil and Sweden

Bioethanol fuel is considered by a number of countries as a tool to reduce the carbon intensity of the transport sector, improve energy security and promote rural development. (Macedo et al., 2008; Hoekman, 2009; Goldemberg, 2007). This has been reflected by the broader move towards biofuels taken by leading economic blocks. The European Union and United States have both manifested their intention to increase the share of biofuels in their final energy consumption (European Commission 2009; US Congress 2007). Most fuel-grade ethanol in the world is used as an oxygenate into gasoline (low blend) which allows the utilization of conventional fuel infrastructure. On the other hand, some countries opted for high-blend ethanol (E100 and E85) in their fuel pools as a way to offer a "green" alternative to gasoline. However, biofuels can only deliver an effective contribution to climate change mitigation if, at the end, they prove to be an attractive choice for consumers. This summary is based on work presented at the 3 rdInternational Scientific Conference on Energy Systems with IT, part of Energitinget 2010. It consists of a summary of an initial investigation from Pacini and Silveira (upcoming), with a deepened focus on a further examination on how gasoline pricing systems can be important in determining the attractiveness of high ethanol blends for the consumer (Pacini and Silveira, 2010).QC 2012021