This chapter investigates the role of ethanol as an alternative for the sustainable expansion of electricity supply in Brazil. The research contextualizes the growing demand for renewable energy sources and the challenges of greenhouse gas emissions. The objectives include analysing the viability of ethanol as a replacement for fossil fuels and assessing its environmental and economic impact. The methodology involves a literature review and analysis of production and consumption data. The main results indicate that ethanol is an alternative and still contributes to the reduction of emissions from the energy matrix, and its large-scale implementation will not face technical and economic barriers, with new generation technologies that have already overcome the challenges. The study concludes with recommendations for public policies that encourage the use of ethanol as a fuel in the electricity sector.