DETROIT (Aug. 29, 2008) - Before he was an open wheel racing legend, Emerson Fittipaldi filled his go-carts with alcohol.

Brazilians are now being encouraged to call it ethanol, as alcohol doesn't mix as well with driving.

“When I started racing go carts in 1961, I used to run them with ethanol and also in my motorcycle,” Fittipaldi said during a biofuels summit, sponsored by General Motors. “I put ethanol in my motorcycle and I put in a higher compression and I won the race.”

In 1976, Fittipaldi’s Formula One team was sponsored by the largest sugar cane company in Brazil, Copersucar. Three years later, Brazil mandated that every gas station include ethanol pumps. Today, there are 33,000 stations serving up E100 and 90% of new cars are flex fuel capable.

The two-time Indy 500 winner turned refiner of ethanol. Fittipaldi was to drive the E85 Corvette in the Detroit Grand Prix over the Labor Day weekend - providing the exclamation point for the automaker, which aims to see 50 percent of its US vehicle fleet be flex fuel capable by 2012, and is pushing hard for expanded ethanol supply and infrastructure.

Part of that agenda includes opening up the ethanol market, which in the US is plainly dependent upon corn as its feedstock. JoelVelasco, a lobbyist with UNICA, a Brazilian sugar cane industry group, said there is much the US can learn from the Brazilian experience.

"In Brazil, gasoline is the alternative fuel," he said.

That's in large part because gasoline is now nearly twice as expensive as ethanol.The trade group is paying for an advertising campaign promoting the repeal of a 54-cent tariff on sugarcane ethanol as a way to alleviate demand for corn for fuel. In the United States E85 now averages $3.03 a gallon compared to gasoline's $3.62. But adjusted for mpg loss and BTU content, the price is closer to $3.99 a gallon, according to AAA.

According to Velasco, just 1 percent of Brazil's arable land is used for sugar cane-bound ethanol and the processing mills to go along with it, whereas 5.8 percent of the arable land goes to soybean production. Sugar cane, of course, doesn't require nearly the amount of water, fertilizer and soil as corn.

And while the Argonne National Labs has certified that corn ethanol is energy positive, that is, it returns more energy than it takes to make it, the studies differ as to whether corn ethanol is carbon neutral.

Brazil expects to produce 6 billion gallons of ethanol this year.

Velasco disagreed with the claims of many environmental organizations who say the rain forest is being thinned out to make way for ethanol-bound crops. Sugar forms during stress periods of no rain, making rain forest lands unsuitable. The same is true for processing facilities which need good support infrastructure, he said.

Bruce Dale, a professor of chemical engineering at Michigan State University who rejects the food vs. fuel debate, argued that the public needs to look at the facts and not the "gut reaction" to ethanol.

"As a matter of fact we’ve been taking land out of our agriculture for years," he said, noting that Michigan alone has removed 4 million acres former agricultural land from production.

Not all of this land needs to return to growing corn, but could be used to grow tall grasses as bio-material for cellulosic ethanol, which Dale prefers to call "grassoline."  Some 1.3 billion tons of cellulosic material could sustain 50-60 percent of all liquid fuels in the US. And less water is used in bio-refineries than petroleum refineries due to the lower temperatures, he said.

"All of us here were born in the age of oil but most of us will live to see the end of the age of oil," Dale said.

Another panelist, Randy Kramer, the CEO of KL Process Design Group - which runs what it calls he world's first production-scale cellulosic ethanol plant using soft wood as a feedstock, argues the economic model around ethanol needs to change.

"We want to take the economic conditions of a certain location and wrap our technology around that," Kramer said. "We’re not looking to build these 100 million gallon plants … What we’re looking at is decentralization."

Such co-located plants would harness bio-waste or even garbage as raw material. The input costs are still very low, such as $5 per ton to transport the local waste wood feedstock to processing plants.

"Zero radius design is the model," he said.

GM is working with the National Governor's Association to increase the number of ethanol pumps. Yet GM officials are continuing to push for non-food based ethanol with its recent investments in Mascoma and Coskata.

"It’s very important to have sustainable ethanol," said Beth Lowery, GM vice president-Environment, Energy and Safety Policy.