At the moment, Brazil's IT experts don't get overly excited about wind,solaror the smart grid.
"Seventy-five percent of the electric power comes from hydroelectric," Sergio Rezende, Brazil's Minister of Science and Technology, told us. "It's very ecological."
Nonetheless, the country's emerging electronics sector will still have a green tech angle. One of the first products out of Ceitec, a government-owned chip foundry and semiconductor designer, will be an RFID tag for cattle.
Agricultural exports make up 10 percent of Brazil's GDP and the country has a cattle population of 200 million. (The human population comes to just under 200 million.) In response to health concerns, the European Union has passed regulations requiring meat packers to be able to trace the source and genetic history of their cows. Many U.S. consumers, meanwhile, are paying premium prices for traceable food. Welcome to the ag/tech nexus.
The Chip de Boy, which goes on the ear of cattle, came into being to prevent any sort of dip in exports, said Eduard Weichselbaumer, Ceitec's president.
Brazil occupies an unusual spot in the pecking order of companies tying a significant part of its future to technology. Compared to the U.S., Europe or Japan, it's an emerging nation. Ceitec is the first production semiconductor fabrication facility in all of South America, noted Weichselbaumer and Rezende, who are part of a trade mission in California this week. The firm is government-owned because the country had difficulty attracting private investors.
"Costa Rica has more incentives," said Rezende, which partly explains why Intel put a testing and packaging facility in the relatively small nation.
On the other hand, its infrastructure, business culture and legal system are more closely aligned with Western standards than some growing Asian nations. The country has also been a force in banking software for years. The raging inflation of the 1980s forced local financial institutions to develop software to manage transactions more effectively. Over the last twenty years, the number of master's degrees granted in IT sciences has risen from 5,000 annually to 40,000, while IT PhDs have risen from 1,000 a year to 12,000.
The plan right now is to figure out ways to cement the country's role as the economic hub of South America, as well as carve out a few niches for global export. How will that manifest itself in green tech?
Biofuels and automotive tech could become more prominent. Ninety percent of the cars sold in the country are flex fuel vehicles, said Rezende. Flex fuel cars only started selling in 2003. The total amount of ethanol now sold in the country roughly equals the amount of gas sold there. The proportion of biodiesel in the national diesel diet is expected to rise from two percent today to five percent in seven years.
By 2025, Brazil wants to produce enough ethanol to replace ten percent of the world's transportation petroleum consumption, he added. Amyris, out of Emeryville, California, has created joint ventures in Brazil that will let it skirt the U.S. tariffs on ethanol.
Communications technologies -- even with the somewhat-less-than-feverish attitude toward the smart grid that is prevalent today -- could be another growth market for Brazil. The government now gives tax exemptions to technology manufacturers that invest four percent or more of their annual revenue into R&D, said Augusto Vieira, who heads up the IT division within the ministry. Virtually 100 percent of domestic PC makers already take advantage of this incentive. (The country also suffered a major blackout last year, which will likely serve as a reminder of why grids need to be improved.)
Rezende further added that the country is aware of its ecological situation. The government recently issued a proposal for another hydroelectric dam in the Amazon. The dam, however, will be built around more efficient turbines that in turn will allow the country to shrink the size of the reservoir supporting it.