When business leaders and government officials gathered at Budapest’s Kempinski Hotel for Africa Business Day early December, the Energy Source was on hand to sniff out potential energy deals between Hungary and the nations of Africa.
One promising lead came from keynote speaker Dr Kandeh K. Yumkella, Dlrector-General of the UN Industrial Development Organisation (UNIDO) and former minister of industry for Sierra Leone, when he mentioned recent interest on the part of Brazil in development projects in Africa that has involved three visits to Africa by Brazilian President Lula da Silva.
Awareness of Brazil’s prowess in sugarcane-based ethanol begged the question: is Brazil investing in African ethanol production and could there be a place for currently disgruntled Hungarian ethanol producers?
Energy Source readers will recall a column on September 14 that reported the crisis facing corn-based ethanol. Disappearing subsidies and removal of EU-mandated market guarantees – prompted by claims that corn-based ethanol pushed up food prices – had jeopardized the corn ethanol business model, hence stopping progress on a number of ethanol production initiatives in Hungary.
This climate had Hungarian Bioethanol Association (MBS) president László Zsemberi shifting his gaze south, to Africa where he had worked years earlier as a civil engineer. “I do see potential for growing sugarcane and other crops including corn in Africa,” Zsemberi then told the BBJ, “and processing it into ethanol and exporting it to Europe.”
Zsemberi could have been heartened to hear his words echoed by Dr Yumkella.
“We can help the EU meet its bioenergy targets,” said Dr Yumkella. “In Africa we can produce biofuels in a sustainable, cost-effective way that will enable a win-win situation for both continents.”
On this he based a call for the nations of the EU to provide subsidies to European firms that develop ethanol production in Africa for export back to Europe.
Yumkella explained that Sudan has the most fertile soil in Africa and is the continent’s largest producer of sugar, the implication being that where there is sugar there can also be ethanol, as the two products share the same feedstock of sugarcane.
Water management, he added, was the biggest challenge facing an uptick in production, but that competition with food for arable land need not be a problem.
He emphasized, however, that close attention should be paid to such large developments as involve ethanol production in Africa because the rush for profits could plough over efforts at sustainability. A failed project, too hastily organized and too quickly abandoned, could leave vast swaths of once arable land parched and robbed of their nutrients.
When the conference broke for coffee, the Energy Source was approached by H.E. Sayed Galal E. Elamin, Ambassador of Sudan to the UN in Vienna. Brazil has already formed a joint venture with Sudan to produce large quantities of ethanol there, he informed.
Elamin’s statement corresponds to a recent report from UK energy watch group New Energy Matters of forthcoming production of ethanol in Sudan “using equipment provided by Brazilian firm Dedini.”
Falling oil prices and the prospect of imported fuel could appear to make imports of African ethanol less attractive to Europe. The advantages of ethanol over oil, however, are well known.
Far less particulate pollution and a renewable feedstock that could offset the supply and price volatility of oil are powerful selling points. The prospect of clean, sustainable production in a continent in need of development is another.
That Hungary could play a role in all of this may not be such a far-fetched idea. The Energy source informed Yumkella that Hungary had its share of ethanol experts, some of whom may be looking for work.
“If Hungary has experts in the field of biofuels,” said Yumkella, “they are most welcome in Africa.”