Sustainable Freedom? E-Book

Edùardo A Platon

• Herausgeber: Viseu
• Kategorie: Fachliteratur
• Sprache: Englisch

Veröffentlichungsjahr: 2023

Beschreibung

This book, conceived in the 2010s, demonstrates that the thesis of renewable energy prevailed. Despite still having a long way to go, after the epic battle between the forces of maintaining fossil fuels in the energy market in Brazil and in the U.S. and the favorable winds of energy and renewable energy infrastructure projects, renewables advanced quickly and are here to stay, whether we like it or not. Renewable energy developments that have taken place in the past decade (from 2010 when this book was conceived to 2020) shaped the way we humans function in society. In this book, the author highlights the beginning of the history of the oil industry in Brazil and oil in the US and the bold and baby steps towards renewables. The rest is history validating itself in the daily life of the third decade of the 21st century until we reach the massive scale of the electric vehicle industry already represented by Tesla, Li Auto, NIO, Lucid Motors, Rivian, among others. Indeed, we see a great change and orientation towards sustainability. In this case, the direction became more important than the speed of implementation of the green, global, diversified future. The question in the current chapter of humanity is whether the concept of sustainability will be expanded to reach the political dimension through the current weakening of Western democracies in the modern world facing massive challenges such as global pandemics, the emergence and rapid expansion in all economic sectors and industries of artificial intelligence, robotics, not to mention the threats of nuclear wars and cyber-attacks between nations and global environmental devastation.

Leseprobe

Conteúdo © Edùardo A Platon

Edição © Viseu

Todos os direitos reservados.

Proibida a reprodução total ou parcial desta obra, de qualquer forma ou por qualquer meio eletrônico, mecânico, inclusive por meio de processos xerográficos, incluindo ainda o uso da internet, sem a permissão expressa da Editora Viseu, na pessoa de seu editor (Lei nº 9.610, de 19.2.98).

Editor: Thiago Domingues Regina

Projeto gráfico: BookPro

e-ISBN 978-65-254-5873-1

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Editora Viseu Ltda.

www.editoraviseu.com

Acknowledgments

I would like to thank Debora, Raphael, and Athena for their love, my parents Newton and Sonia, my sister Paula and nephew Angelo, my Brazilian-American family, and my global friends for all of their support over the years. Due to you, I am turning this project into reality to keep a record of a time that was the basis of the present and the future, a promising energy future, we hope.

Written in memory of Paula, an illuminated human being filled with grace, kindness, and loving energy.

Introduction

This book shall focus on the energy market dynamics of Brazil and the United States with a primary focus on joint international development and sustainability in order to lay down the base of future possibilities for, and the limits of, cooperation between Brazil and the United States. To cope with the future of energy in the Americas (attempting to close a historical gap between developing and developed countries) while facing the challenges of the new millennium (e.g., population growth, energy consumption, climate change, destruction of forests, deterioration of arable land, water availability), a new energy strategy is critical for success.

A more balanced energy portfolio that emerges from a smooth transition away from fossil fuel and towards renewable shall enable countries to avoid global conflict, environmental degradation, social exclusion, and wealth disparity. An all-inclusive partnership and institutional alliance designed to do well for Brazil and the United States, shall not only lead, but also overcome current limitations (e.g., political, technological, economic) to secure the way energy is perceived, produced, transformed, consumed, and recycled.

I offer two fundamental points to support my argument in favor of a massive bi-national green wave consortium in the Americas led by Brazil and the United States. Both are aimed at adding interest and value to the global energy future where the notions of freedom and sustainability come together to draft a new world order. In this partnership, international development and sustainability become two important pillars of human development.

The global community seeks new ways to activate the Universal Declaration of Human Rights in practice while looking for alternative ideas to reach peace and prosperity. Currently, the ideas of energy shortage, unaccomplished social development, isolationism based on exclusive domestic development, scientific progress for scientific progress’ sake (the negative side), energy cooperation in green technologies, healthy economic partnership worldwide, sustainability, and moral conduct (the positive side) can be developed to accommodate the needs, wants, and desires of the global community.

I support a strategy of global green diversification over domestic gray isolationism due to the former’s ability to promote wider and deeper benefits in terms of international development. I support global green diversification over domestic gray isolationism due to the former’s ethical propensity to respect local communities and honor the environment while diversifying the risk of exclusive reliance on limited sources. Essentially, both points - responsibly developing the planet and sustainably honoring the planet’s resources favor the notions of global collaboration over competition, “green” over “gray” energy products, diversification over isolationism, innovation over conservatism, ethical over unethical behavior, and last but not least, diplomacy over international conflict and war.

The bi-national green wave consortium led by Brazil and the U.S. shall encompass all sources of energy (renewable and non-renewable) and most stages of development (from R&D to market supply) that, once put together, can unleash a powerful energy portfolio worldwide. The challenge is to find balance in the tides of moral and material prosperity raging in the ocean of human understanding, scientific knowledge, and political will. There is a natural mass of immeasurable potential accessible to all willing to surf the green wave of new opportunities. The new scenario shall encompass multiple forms of material progress and moral advancement that can benefit both countries heading towards international development and sustainability.

With the use of clean coal and natural gas, while progressively adding a bulky energy share of solar, wind, biofuels, micro and small hydropower (to cite a few), the bi-national collaboration in the Americas is capable of making a realistic and smooth transition from fossil fuels to renewables. The U.S. brings a wealth of freedom and evidence of a robust economy, and Brazil brings a successful model of a more diversified and sustainable energy portfolio. Together, both countries are capable of developing and perfecting the idea of sustainable freedom.

The attempt to develop a new energy mix and policy in Brazil and in the United States shall focus on nothing less than a strategy of global green diversification over domestic gray isolationism. The motivation for choosing one over the other is based on an integrated energy future that can improve relations between the two countries and bring people and resources together.

Historically, the way fossil fuels and renewables developed in each country has much to do with land propensities for particular energy developments, economic conditions, societal support, and political determination. Nonetheless, the search for better energy sources continues to drive Brazilians and Americans alike, by and large, energy enthusiasts, towards modernity. The challenges brought on by their respective energy evolutions have given both societies a head start with certain technologies. Moving forward, a massive bi-national partnership between Brazil and the United States can take these technologies to the next level.

Finally, a brief comparative analysis of Brazil and the United States will prove important for the purpose of discerning energy investigation to create a new energy portfolio. To better understand the history of energy developments in each country, the reader might skip to appendices A and B that offer country profiles on Brazil and the U.S. Overall, the two countries share important similarities, such as a history of slavery and class segregation, cultural diversity, unequal economic development, and damage to the environment. In other areas such as education, geography and climate, and foreign policy, each demonstrates major differences, making the discussion on energy even more interesting.

To understand the energy future of Brazil and the U.S., identify areas for mutual collaboration, and create a joint vision for sustainable freedom, a historical view of energy developments (from oil to renewables) shall prove edifying.

Studying history (philosophy and philosophers included) is a great way to identify mistakes and possible solutions to keep international development projects evolving. It also allows us to analyze the mindset of public and private entities concerned about a multi-disciplinary context of social, environmental, and economic development on the issue of energy. The transition from fossil fuels to renewables is certainly challenging, but the critical question is: If celebrated economists, thinkers, and philosophers such as David Ricardo, Karl Polanyi, and Jean-Jacque Rousseau were able to see into the future, identify the intellectual gaps, and have a grasp of possibility thinking, what are we waiting for?

Brazilian oil

The history of oil in Brazil started as a symbolic quest to advance national honor and later became a source of national pride. In his celebrated book Oil and Politics in Modern Brazil,Peter Searborn Smith, PhD, a Canadian professor at the University of Arizona and an expert on Brazilian oil politics, wrote that the search for oil in Brazil started a few times (1976). Professor Smith proposed that the Brazilian quest for oil began several times with British, American, and then Brazilian oil pioneers willing to search for evidence of oil.

The two British men, after extensively searching for oil in Brazil and finding no indication of the valuable commodity, issued a statement affirming that the country had no relevant oil reserves for exploration. Then, one American oil expert was hired by the Brazilian government to report on oil availability. The oil venture failed, and the foreign expert ended up rejecting Brazil’s relevance in oil.

Finally, as an act of faith due to the size and perceived richness of the Brazilian soil, national enthusiasts and oil pioneers started their own search for the precious resource. The story goes that Brazilians in the first half of the 20th century were skeptical about the fact that the country’s vast landscape lacked significant reserves of the black gold. The common notion held by Brazilians was that the country was bigger than all other countries in South America that had found oil. Thus, oil in Brazil should not only be accessible but also exist in abundance.

To the surprise of many, the discovery of oil in Brazilian territory became a reality. The act of faith paid off for the most part and Brazil eventually became self-sufficient in regard to oil. Nonetheless, the act of faith would not prove itself entirely until the country reached oil self-sufficiency in 2006, publicly announced by President Luis Inácio Lula da Silva and celebrated by the Brazilian people.

It was such a long road towards self-sufficiency (more than 50 years), that the history of oil in Brazil created an alliance of believers and non-believers regarding the existence of oil in the country. In addition, it created political friction and disputes between extreme nationalists and xenophobes. Over the years, each group developed a position regarding the existence of oil in the country and the desired role of the government in all sorts of oil developments. The intervention of the Brazilian government in the exploration and production of oil via Petrobras, the state-run enterprise, has remained a controversial historical fact in Brazil.

Until the age of corruption, Petrobras remained the largest company in Latin America by market capitalization and revenue, and the largest company headquartered in the Southern Hemisphere. Petrobras also remained a world leader in the development of advanced technology from deep-water and ultra-deep water oil production (WIKIPEDIA, [2022], online).

Those who criticized the long pathway to oil sufficiency remained against the involvement of Petrobras in Brazilian energy developments. They maintained that the country should engage in partnerships with foreign companies to speed up the process of oil discovery. For them, Brazil could have done much better without Petrobras or any intervention coming from the central government. Critics of Petrobras advocated support for free and equal participation of Brazilian and foreign investors alike who should have access to the development of oil fields. They proposed a strategy concerned with accelerating oil discoveries and advocated joint ventures with no government intrusion.

Those who favored the state-monopoly enterprise for oil continued to defend the fact that it only took fifty-plus years to discover oil after the national oil company Petrobras started operations in 1954. Back in those days, they reinforced the idea that through a collective act of faith, fueled by feelings of national honor and skepticism towards the foreign element, Brazil would be a leader in the search for and processing of oil. The popular rhetoric of “the oil is ours” that emerged in the following decades foresaw a generation of Brazilians enjoying the benefits of petroleum ownership under the axis of Brazil. Those in favor of the state monopoly or Petrobras claimed that the amount of time dedicated to finding oil, an exclusive Petrobras venture, was a reasonable price the country should pay to keep full ownership of Brazil’s oil.

The leadership of President Getúlio Vargas (patriotic, partisan, and loyalist to populism) from 1930 to 1945 and then from 1951 to 1954 (WIKIPEDIA, [2022], online) sealed the fact that oil ownership remained exclusive to Brazil’s central government. For instance, not even influential state administrations such as Sao Paulo and Rio de Janeiro had the power and authority to drill oil in their own territories. All minerals, fluids, and solids encountered in the Brazilian soil (under a certain depth) were essentially part of the federal government’s list of indisputable assets. President Vargas enforced the idea of controlling the country’s natural resources via a central structure to avoid corruption and mismanagement.

The Brazilian oil market would remain closed to foreign groups and private interests until 1997. Then, another president, Fernando Henrique Cardoso, decided that it was time to open the market to private, domestic, and international investors willing to drill and produce oil in Brazil. By signing the Oil Law 9.478, President Cardoso initiated a new chapter in the history of petroleum politics in Brazil. The Oil Law basically created two regulatory bodies that aimed to regulate and supervise the oil market. ANP (The National Petroleum Agency) and CNPE (Brazil’s National Energy Policy Council) acted almost simultaneously to apply granting systems designed to encourage the best offers from private parties. Under the new law, ANP and CNPE started offering oil and gas concessions for drilling and exploration. They offered concessions to all companies national, bi-national, multinational, or foreign willing to drill and produce. In terms of responsibilities, CNPE concerned itself with the development and enforcement of energy policies in the country, while ANP focused its time, talent, and money on energy regulation, contracting, and monitoring.

As a unique case in the Western world, the development of the oil industry in Brazil broke loose from the customary. Generally, the birth of oil markets in developing countries had been created and ruled by large foreign enterprises eager to exploit the commodity, set the pace for development, and pre-arrange the conditions. Curiously, Brazil created Petrobras before it found any oil in the country, challenging the status quo of the oil cartel and affluent petroleum elite in the world. To the surprise of many, the unlikely outcome worked reasonably well and nationalist oil politics prevailed. Under the leadership of President Getúlio Vargas (the most popular and nationalist politician in the history of the country) Brazil and Petrobras became the exceptions to the rule.

On January 1, 1954, the national oil company Petrobras officially initiated operations. With vast support from the President, the company that would become a state monopoly, changed the history of Brazil by influencing the future energy profile of the country. Petrobras proved that it was possible to rely on Brazilian energy policy and decision-making to create successful partnerships and alliances within the country. Petrobras came to life as a small-scale state-monopoly company searching for oil. As time passed and oil discoveries became the norm instead of the exception, Petrobras received more attention, technical support, and investment and became a giant energy enterprise.

As of 2010, Petrobras was one of the largest companies in the world ranking 34th in the Fortune Global 500 rank (2009 edition). With revenues of more than 118 billion dollars and growing, Petrobras incorporated different fuels and business units to power the energy needs of Brazil. With celebrated expertise in offshore deep drilling, qualified management, and state-of-the-art technical controls, which has led the company to enjoy participation in the Dow Jones Sustainability Index (DJSI), Petrobras ranked 12th in the global oil Industry. (FORTUNE, [2022], online). Based on 2010 data, these were the companies that are ranked 1st–11th: Royal Dutch Shell with annual revenues of 458 billion dollars, Exxon-Mobil (442 billion), BP (367 billion), Chevron (263 billion), Total (234 billion), Conoco-Phillips (230 billion), Sinopec (207 billion), China National Petroleum (181 billion), ENI (159 billion), PDVSA (126 billion), and Valero Energy (118 billion).

A curious fact is that Petrobras never went through a painful process of nationalization, similar to what occurred in Venezuela (PDVSA), or needed to report oil findings to stakeholders seated in boardrooms overseas. The Brazilian state monopoly has remained mostly under the tight grasp of the Brazilian federal government since the day of its constitution. It is the largest publicly-funded oil enterprise in the free Western world.

Although receiving private investment these days, Petrobras has never applied the fundamentals of America’s powerful joint venture between private commercial interest and the military (see appendix B for more information) to expand operations and win market share. Petrobras never had a chance to benefit from the perks of an alliance between Brazilian commercial interests and armed forces. For instance, Brazil’s growth and development have not been based on superior military power or even commercial might.

Nevertheless, Brazil’s reputation has grown over time, powered by Petrobras’ commitment to innovation and expansion. The growth of the company has been rooted in servicing the needs of the domestic market, satisfying partners, investing in research and development, promoting technical expertise, and rewarding higher education, not to mention working with both fossil fuel and renewable energy to generate profits. Petrobras might represent what U.S. President Barack Obama projected for the energy future of the United States.

President Obama and his administration, aware of successful energy stories across the globe, were seeking a strategy that could lead the country away from reliance on fossil fuels and towards a growing participation with renewables.

As of 2010, Petrobras was producing more than 2 million barrels of oil per day (ANP, [2022], online). These numbers indicate that the company was capable of meeting domestic market demand. Although a highly controversial issue in Brazil, Petrobras’ role and leadership in the development of Brazil’s Pro-Álcool (ethanol) program after the Oil Embargo of 1973 has been decisive and even positive to the success of the enterprise. Due to its participation in ethanol developments to push ethanol forward as an alternative fuel, currently available in most if not all gas stations in Brazil, the company is currently perceived as energy-oriented. Some go as far as to suggest that without Petrobras’ strategic intervention and invisible hand in some critical moments, ethanol would not be expertly positioned in the energy industry in Brazil, enjoying all the market visibility and accessibility of Petrobras’ distribution network. In spite of the great difficulties to secure a reliable supply chain of ethanol as a fuel that would not rely necessarily on the oscillations of the sugar industry worldwide, ethanol prevailed. Focusing on competitive structures of power worldwide, it seems reasonable to argue that ethanol developments in Brazil benefited more from Petrobras than most Brazilians want to believe.

Petrobras engaged in a long journey, initially producing petroleum derivatives only in Brazil, to reach its current global rank and presence in more than 27 countries also producing biofuels. The original idea of oil existence and abundance in Brazil, an act of collective faith, went from plain speculative thought and wishful thinking to actualization and large profitability via Petrobras. Indeed, faith in the abilities of the government to determine and discover resources did work for the oil industry in Brazil for a period. With faith came oil reserves that improved its prospects over time and generated multiple benefits for the faithful and unfaithful alike.

In the hands of Petrobras, Brazil gained international recognition in technical projects, obtained political relevance, promoted social unity, enjoyed economic prosperity, obtained self-sufficiency in oil, and improved its balance of trade. For critics and enthusiasts alike, Petrobras remained one of the icons of Brazil. A quest for national honor and prosperity, it remains active and growing. In 2009, Petrobras, loaded with revenues and positive oil prospects, continued to unleash the Brazilian potential in fossil fuel and biofuel energy.