Industrial alcohol production in Brazil is based on fermentation of sugar cane juice. After centrifugation and distillation, azeotropic alcohol is obtained along with four side streams: (1) bagasse, the solid part of the cane plant, (2) yeast, grown during the fermentation, (3) carbon dioxide released during the fermentation and (4) waste water called vinasse composed of the bottom fraction of the distillation and wash waters. The profitability of alcohol distilleries can be improved by a more rational use of the side stream products. The solid products have a diversified application potential. By applying anaerobic digestion to vinasse, methane can be produced at a proportion of 100 kgCH4 per m3 of produced alcohol. Full scale application has shown anaerobic digestion to be technically and economically feasible and the digested waste water can be used for irrigation, whereas the produced solids can be applied as soil conditioners.

An alternative for improved energy production is to abandon alcohol fermentation and apply anaerobic digestion directly to the vegetal energy source. In that case the useful energy production is much higher and can be obtained using much simpler equipment. More importantly, the source for energy production would no longer be restricted to cane: Other crops, notably those produced in the drier hinterland of North East Brazil (cassava, sweet potatoes), could also be used for this purpose.