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| Small scale biofuel (Jatropha) production in Zambia |
If the EU commission really cared about the poor and the hungry in developing countries, it should be concerned with the effects of its own agriculture and trade policies on these people, rather than engaging in fruitless discussions over biofuel competing with food.
“BRUSSELS, Oct 17 (Reuters) - New EU rules to limit how much food can be made into biofuels are "not perfect" and make it harder to achieve overall goals on switching to low carbon energy, European Commissioners said on Wednesday. But they insisted the proposals sent out the right signal to the biofuel industry, which would have to move on to new-generation fuels that do not compete with demand for food.”
If the EU commission really cared about the
low carbon economy, it should be more concerned with the 95% of the fuel that
is fossil than the 5% that is renewable. Or as a matter of fact, it should be
concerned with a transportation system built around the private car. Cars and
petrol are the culprits – not biofuel. Actions to reduce car traffic and total
fuel use is much more important that the application of sustainability criteria
on the 5% that should be biofuel.
And if the EU commission really cared about the
poor and the hungry in developing countries, it should be concerned with the
effects of its own agriculture and trade policies on these people, rather than
engaging in fruitless discussions over bio fuel competing with food. Why single
out biofuel? What about the liquor, wine and tobacco cultivation? What about cotton?
We can wear nylon instead. What about all land that is used of golf courses or
hobby horses? In Sweden
we use more than half a million hectare to feed our hobby horses. What about
feed stuff? The EU commission seems to forget that most biofuel production also
produces highly valuable animal feed stuff, so the net land use for biofuel is
not as big as it looks like.
The EU
commission seems to have no understanding of how global food and agriculture
markets work. From the perspective of farmers, the food sector has been a
buyer’s market for most of the time. Increased food prices and more alternative
uses for farmland is a boon for farmers. It is also in general positive for
rural areas, and for those living in the rural areas. Most hungry people in the
world live in rural areas and even those that are net buyers of food (e.g. agriculture
workers and small farmers) will in most cases benefit from increased incomes in
the area as it means more employment, more demand for services, better
infrastructure. Admittedly, higher prices, are a problem for the poor in the
slums of the mega cities. But there is not a very strong link between biofuel
and higher food prices. The price hikes the last five years are more strongly
linked to increased oil price than anything else. See more in Why
oil price and grain price follow each other.
If the biofuel
production of the US, the EU
and Brazil
would cease, there would be a massive fall in global agriculture prices. For a
short while, poor people in the slums would get cheaper food. But within a few
years, masses of farmers in both developed and developing countries would have
been forced off the land and in developing countries, most would become dirt
poor. They and the people working for them would be worse off than today, and
more hungry.
Having
said that, there are many issues to discuss around biofuel:
Like the rest of the agriculture sector,
biofuels too are subject to large political interventions. Globally, biofuels
received some US$ 11–12 billion in subsidies in 2006 (FAO 2008). During
2006/2007, one-fifth of the maize yield in the United States was used for
biofuels, stimulated by heavy subsidies, and still the amount only corresponded
to some 3% of petrol consumption (World Bank 2007). A report for Friends of the
Earth states:
[A] realistic
bioenergy potential on cropland and grazing land in the year 2050 may be around
70–100 EJ/yr,[1]
with the lower number being environmentally considerably more favourable than
the higher one. For comparison, we note that the global technical use of
primary energy is currently around 550 EJ/yr (fossil energy use around 450 EJ/yr).
This means that the bioenergy potential from cropland and grazing land is in
the order of magnitude of 15–22% of current fossil energy use. (Erb et al. 2009: 25)
The results of the report Agriculture as
Provider of Both Food and Fuel, Kersti Johansson, Karin Liljequist, Lars
Ohlander, Kjell Aleklett are more or less the same. This shows that
biofuels present a very limited possibility for reducing society’s dependency
on oil. This doesn’t have to be an argument against biofuels by itself, rather
an argument for the need to totally redesign transport systems. This also means
that we have to address the growth in
transportation as the main problem (for those saying that electric cars are
the solution, read
this).
One disturbing aspect is that a lot of biofuel
production has a bad energy ratio; some examples even show ratios below 1,
implying that the production of biofuel uses more energy than the energy
content of the fuel itself, something that is obviously only possible to
achieve with massive political distortion. For grain-based biofuels, the energy
ratio in a number of cases studied ranged from 0.7 to 2.8.[2]
The energy ratio of biofuels from lignocellulose is normally higher as is the
energy efficiency of sugar cane ethanol.
The biggest problem with biofuel is the potential
competition with other land use, as increased biofuel production is likely to
either take place in now-low-on-production, but highly biodiverse, rangelands
or expand into ‘virgin’[3]
lands, such as wetlands and primary and secondary forests. Biofuel is also
often grown in monoculture, uses a lot of agrochemicals and can be the reason
for ”land-grabbing”. But none
of these apply for all forms of biofuel, and can’t be used as an argument
against biofuel as such. Small scale biogas made from manure and other waste
fuels the cooking of many million of people around the globe. Several hundred
million animals provide power to pull farm implements and transport goods all
over the globe – their fuel is all from agriculture lands.
Read More:
Biofuel in many shapes, about biofuel for the local market in Zambia
BBC had a very interesting article about biofuels in Germany
Energy and agriculture about the general questions about energy in agriculture
Financial times on the EU proposal
The Guardian
[1] Here ‘EJ’ stands for Exa Joule;
1 EJ=1018 J.
[2] This also
means that if you want to replace 100 EJ of oil with biofuel, you might
need 200 EJ of biofuel, because 100 EJ will be lost in the process of
making biofuels if the ratio is 2.
[3] I put virgin in quotation marks to
indicate that there is no such thing. All landscapes today, with the exception
of land under the glaciers, are influenced by human activity.
Hi Gunnar,
ReplyDeleteI agree with most of what you write here, but you shouldn't read too much into the EU's actions to try to tighten sustainability requirements on biofuels. To use an agricultural metaphor, this is all about closing the barn door once the horse has bolted.
The EU, like most other economies that have embraced biofuels, saw what they perceived as the upside -- higher prices for crop farmers, more domestic energy production, new industries for rural areas, perceived GHG benefits -- long before they acknowledged the many downsides that you describe.
The problem is, their embrace involved first tax breaks and then regulations mandating their use, thus locking in a market for biofuels. Once the downsides started to become more evident, and environmental groups took up the cause, what we have witnessed is a gradual attempt to minimize the environmental risks through ever tighter sustainability requirements ... at least on paper.
Of course, this is equivalent to stepping on the brake (standards) while still applying the accelerator (subsidies and mandates). The first-best policy would be to take one's foot off of the accelerator. But you can imagine the legal battles that would ensue: investments have been made in biofuel-production capacity on the basis of these support measures.
Why single out biofuels and not other non-food industries that require agricultural land? Because the CONSUMPTION of biofuels is being mandated and subsidized. Tobacco and alcoholic beverages are taxed, by comparison. If biofuels had emerged through market forces alone, or in response to carbon taxes on transport fuels, I really doubt that there would have been any sustainability standards created for them.
Note also that with respect to trade effects, these standards operate in the same way as standards for organic products. That is, they do not restrict trade in the products per se; rather, they restrict which products can gain access to the segment of the market that pays higher prices -- in the case of biofuels, those that can benefit from subsidies, tax breaks, or credit towards meeting biofuel-use quotas.
One other observation: the PRIVATE standard-setters and certifiers have their own, highly ambitious agenda. Several years ago I raised the question, "why single out biofuels?", with the head of a major independent biofuel certification initiative, and also with a high-ranking official for an international NGO. Both were quick to reply, "Of course, biofuels are a narrow segment. But this is only the beginning. Our aim ultimately is to apply sustainability standards to ALL products of agriculture!" Supply-driven standards, what a surprise!
Good points Ronald!
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