World Bank Document

e done to increase the supplies Latin America. Despite consider- to make much of a contributionof the kinds of energy that are able geothermal potential in up to over the next 10 years; shale oilparticularly important for poor 30 developing countries-among and methanol have rather morepeople!. them Kenya, Mexico, El Salvador, potential. Alcohol produced from* Petroleum and natural gas. Nicaragua and the Philippines- biomass (cereals, sugarcane, beetsWhile the oil-importing developing geothermal capacity will produce and so on) is now used as a partialcountries have only about 2 percent relatively little electricity in the substitute for gasoline. The techofthe world's proven oil reserves, 1980s. But nuclear power could nology for producing it is welltheir share of ultimately recover- produce 11 percent of the total by established. A key question is theable oil reserves may be 15 percent. 1990 (2 percent in 1980)-mainly extent to which agricultural landOne study (undertaken for the in the major existing producers should be diverted from food toWorld Bank) estimated that 23 of (Argentina, Brazil, India, South fuel production (see box).70 countries surveyed each might Korea and Pakistan) but in other * Energy for the poor. The poor,have ultimately recoverable re- countries as well (for example, especially those in rural areas, relyserves of at least 750 million bar- Romania, Thailand, Yugoslavia and on noncommercial energy forrels. (For comparison, net imports the Philippines). cooking and heating; these formsof oil for energy use by develop- * Other sources. Any significant of energy provide more than 85ing couintries will amount to about increase in the production of oil percent of rural requirements in110 m:llion barrels in 1980.) To from tar sands in developing coun- many countries. Yet their suppliesrealize their full potential, most tries depends on a major tech- are dwindling, thus inflicting sevcountriesmust step up exploration nological breakthrough. Solar and eral sorts of hardship. Much timeactivities; the same study judged windpower are also unlikely is spent just in gathering fuel (forthat exploration was inadequatein 51 of 58 countries that werenot producers.Gas is widely spread; many Fuel from foodcountries can significantly expand Alcohol produced from sugarcane or or have the potential for large "gasohol"production-both for domestic grains is becoming competitive with programs.energy use and for petrochemicals gasoline as real petroleum prices rise. This development could indirectly-during the decade. A lot of gas Conventional automobiles and trucks affect the availability and price of foodassociated with oil production is can run on "gasohol," a mixture of alco- for developing countries that either imholand (at least 80 percent) gasoline. port grain on commercial terms or dependnow wasted by venting or flaring; With engine modifications, they could on international food aid to meet theirmuch of it could be recovered. run on pure alcohol; such engines are deficits. Current plans in Brazil and the* CoDal. For most developing already being produced in Brazil. By United States envisage that the area ofcountries, coal is still a minor fuel 1977 the estimated national ratio of alco- cultivated land would be expanded toused mainly in electricity genera- hol to gasoline use in Brazil was 4.3 per- grow fuel crops, so that food productioncent; in 1979 it had risen to 19 percent, (and therefore price) is not significantlytion and-in larger coal producers and will rise further as more cars run on affected. In practice these goals may not(such as India, Turkey, South Korea pure alcohol. be fully achievable.and Yugoslavia)-in industrial ap- Brazil's alcohol is still derived almost Whether ethanol proves economic inplications. Coal can substitute for exclusively from sugarcane, but alcohol other countries will depend on landoil in electricity generation, but can be produced from a variety of crops. availability, markets and prices for foodus s Ethanol, the cheapest alternative to gaso- exports, and the development of suchthe potential for increased use is line in the 1980s, comes from fermenting alternative sources as wood, sorghumlimited largely to new capacity- sugar crops, principally sugarcane; root and agricultural waste. In the next fivesince converting existing plants is crops, mainly cassava; and cereals, years or so, the quantity of agriculturaloften uneconomic. especially corn and potentially sorghum. production diverted into alcohol is likely* PrJ1arv electricity. Two-thirds The United States also has ambitious to be small (with the exception of BrazilP .imary e.ectncity. plans for producing alcohol fuel, pri- and the United States). But as moreof the electricity generated in devel- marily from corn. The US target of 2 countries consider ways of reducingoping countries is used in industry billion gallons of ethanol by 1985 would petroleum import costs, the "food or(compared with 40 percent in the require 20 million tons of corm or its fuel" issue may become more serious.industrialized countries). Hydro- equivalent, one fifth of the current US A satisfactory solution will require apower, currently accounting for exportable grain surplus. And other food major effort to develop alternative bioofelectricity output, can exporters (including Argentina, Austra- mass sources of energy, including crops44 percent of electricity output, ca lia, New Zealand, the Philippines and that can be grown economically onbe greatly expanded in many devel- South Africa) either have already launched marginal land.oping countries-particularly in17