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Brazil to invest $2.85bn to fund biofuel and renewable chemical tech research

BRIC country plans to triple funds for biofuel companies developing processes to turn sugar cane into chemicals and boost ethanol output, reports claim

GranBio says Brazil has the best conditions to lead a biotechnology revolution in second-generation ethanol, Bloomberg reports

Agencia Nacional de Energia Eletrica, Brazil's power regulator, expects utilities to channel BRL 600m into projects in the Inova Energia program, Bloomberg said. The companies are required to invest 1 per cent of net operating revenue on research and development as well as energy-efficiency programs.

"Brazil has the best conditions to lead a biotechnology revolution in second-generation ethanol," according to Bernardo Gradin, chief executive officer of GranBio. The Sao Paulo-based company was approved in May for a BRL 300m BNDES loan to build Brazil's first commercial-scale cellulosic ethanol plant.

"We need companies to take a risk on innovation," said Ricardo Rivera, a manager at national development lender BNDES's department for information technology and communication, Bloomberg reports. "We had some macroeconomic problems in Brazil which sapped the spirit of innovation here."

"We're trying to boost investment in research in areas that we think Brazil can be competitive in," Comin added.

BRIC investment

Around 90 per cent of investment in Brazilian renewable energy research projects were made by governments last year, compared to 68 per cent in China. Government agencies and businesses in Brazil invested USD 112.6m last year in researching renewable-energy technologies, up 15 per cent since 2009. Meanwhile, China spent USD 2.53bn and India spent USD 145.2m million, according to data compiled by Bloomberg.