According to the report World Energy Outlook 2008, elaborated by the International Energy Agency (IEA), the demand for energy can increase almost 50% by 2030, with the increase in carbon emissions; if this trend remains unaltered, it may cause the global temperature to increase by up to 6 degrees Celsius. The reversion of this scenario will only be possible if the world makes significant investments in the generation of renewable energy, produces more energy while reducing carbon emissions, and improves energy efficiency.

These three challenges will need to be faced to meet the demand for energy of a world population that currently totals 6 billion inhabitants and, in 2030, is expected to reach 9 billion. If we were to tell the history of the 20th Century, perhaps the best way to do so would be through petroleum. Petroleum as a means of energy, which sustained the second industrial revolution with the combustion engine, and the first with coal for steam engines.

However, the absolute supremacy of petroleum tends to end due to its finitude, its negative impacts on the environment, and the issue of energy safety. Proven world reserves of petroleum and natural gas currently stand at about 1.2 trillion barrels of petroleum equivalent. It took the world 140 years to consume its first trillion barrels of petroleum; the projection is that the second trillion will be consumed in 30 years.

There is a big debate in progress concerning finitude of petroleum. The term peak oil or Hubbert peak was created to explain why the production of oil is supposedly at its peak, and why in the next few years the trend is to decrease the relation reserves/production. Petroleum peak is often confounded with petroleum depletion. Petroleum peak is the maximum production point, whereas depletion refers to a period of decline of reserves and supply offer.

In 1956, M. King Hubbert created, and for the first time used, models based on the concept of peak petroleum to predict that the production of oil in the United States would reach the maximum level between 1965 and 1970. Others state that, in the course of History, this thesis on finitude of petroleum has continuously been denied, because the factor that determines the size of the reserves is the barrel price.

Thus, after World War II, the gigantic fields in the Middle East were discovered, the first and the second oil shocks made oil exploration at sea feasible, and now a barrel priced at more than 100 dollars supposedly has made possible the extraction from pre-salt layers and even from the bituminous sands of Canada. The current of opinion we agree with most is the one which states that the stone age did not end due to a lack of stones, or that the petroleum age will end due to the lack of petroleum.

In other words, it will be energy safety and global warming that will dictate the end of the absolute reign of petroleum. In the context of the current economic crisis, the debate axis is changing in the energy sector in the world and in Brazil. The debates about the lack of energy and high prices are making room for those on energy surplus and low prices.

Actually, we should not repeat the mistake made in the most recent low oil price cycle that lasted 12 years (1986-1998), when clean energy replacement programs for petroleum were abandoned. The economic crisis makes room for a debate about public policy and investments aimed at establishing a clean and diversified energy matrix.

This is also so because the current cycle of low oil prices will not last as long as the previous one, due to the fact that oil supply did not grow much during the period of high oil prices. Therefore, any sign of recovery is expected to increase the barrel price quickly to between 70 and 80 dollars. In the USA the concern about building a diversified and clean energy matrix becomes very apparent. In his interventions in the energy issue, the U.S. President shows three concerns.

The first is energy safety. The USA no longer tolerate depending on imported petroleum from countries that live in permanent political, social and quite often religious conflict. OPEC, which congregates most of these countries, holds about 70% of world petroleum reserves, and, in non-OPEC countries, Russia has 40% of the reserves.

The second is with respect to the environmental issue. There is already consensus that the world can no longer burn fossil fuels in the quantities it used to in the 20th Century. The third is to generate new jobs through the production of energy. With that, the new U.S. President is proposing an energy policy aimed at increasing energy safety, helping improve the en-vironment and generating a lot of jobs.

In Brazil, one must know how to take advantage of renewable energy, and at the same time, of the pre-salt layer discoveries. We have abundant sun, land and water, therefore we can be the most efficient and the largest producers of sugarcane and, thus, lead in the production of ethanol and generate electric energy from cane bagasse.

In addition, we may become large ethanol exporters, as well as of agricultural and industrial technology. With our extensive coastline, we can generate more energy from wind, and go back to generating more new energy from hydroelectric plants, rethinking the environmental license obtainment process. By doing that, we will generate clean energy made in Brazil.

What is lacking in Brazil, in order for us to advance in the direction of assuring substantial participation of renewable energy in the Brazilian energy matrix, is the creation of taxes on emissions, a market for trading emission rights and rewarding more efficient consumers who use renewable energy. But, in the meantime, the scenario defined by the new energy auctions realized by the current government points to an electric energy matrix increasingly dirtier.

The results of the electric energy auctions confirm the increasingly more common trend of generating energy from fossil fuels, and what is even worse, is that 45% comes from fuel oil that, apart from dirtying the electric energy matrix, submits it to the price volatility of this fuel. As a result, 75% of the energy added to the electric energy matrix through the auctions is thermal.

Based on the Cost-Benefit Index (CBI), apparently the auctions until now have negotiated the cheaper electric energy. However, it is reason for concern that the CBI bases itself on theoretical estimates of the plants’ generation. Given that these plants will, in theory, be built to operate only in hydrologically unfavorable times, one gets the impression that the objective of the government’s tariff reasonability is being achieved.

In reality, the current auction methodology sets unrealistic and misleading prices for thermal generation, given that these plants will be generating for longer periods than the one set forth in the auctions. The fact is that the methodology used in the auctions has adversely affected projects that have clean generation technologies and high investment costs.

Thus, Brazil continues in the opposite direction of the developed countries that seek to increase the share of clean sources in their energy matrixes. The pre-salt reserves cannot be the excuse for Petrobras to justify, in its ambitious investment plan for the period 2009-2013, the announcement of the construction of four refineries. This kind of investment, apart from creating huge environmental liabilities, will end up damaging or even rendering ethanol unfeasible.

There are few examples of countries with large oil surpluses that escaped the populist temptation of subsidizing the prices of oil derivate products. The exploration of the pre-salt layers can lead to retrocession in terms of the national energy matrix, intensifying the use of petroleum and invalidating all past efforts undertaken to make it one of the cleanest in the world.

We will only achieve this target if we establish an energy policy view with a long term perspective. I read an article in the New York Times in which the author writes about the climate caravan promoted in India using electric cars. In Brazil we could promote a climate caravan with ethanol vehicles. The idea is hereby launched.