Biofuels: the Good, the Bad and the Unusual

by Ralph Sims, International Energy Agency

Within recent months biofuels have gone from making headline news as being the world's salvation for when the oil runs out to becoming a "crime against humanity." Almost every day the world's media run a story on the topic, often blaming biofuels for all the world's pending disasters. Even a recent spike in the price of rice was blamed on producing more biofuels whereas, in fact, rice is not used as a feedstock at all!

There are legitimate concerns about the sustainability of some biofuel sources and they have taken a lot of criticism. But it is important to put this in perspective, since, as is often the case, the truth probably lies somewhere in between the extreme viewpoints. If only the oil market was scrutinized to the same degree!

There is no doubt there are "bad" biofuels that result in the world being worse off as a result of their production. But there are also "good" biofuels that can be produced in a sustainable manner, support local development without exploitation, and result in a reduction of overall environmental impacts including greenhouse gas emission reductions.

Concerns at the amount of misinformation appearing in the media being picked up by policy-makers, coupled with a vision that biofuels produced in developing countries (the South) could in fact provide considerable local benefits relating to sustainable development, as well possibly providing export potential to developed countries (the North), led Professor John Mathews of Macquarie University, Sydney, Australia to take action.

He solicited 17 people with key interests in biofuels from a wide range of international, national, industrial and academic organizations to meet together to discuss the topic in depth and to agree, by consensus, on a brief document. This document could then be used internationally by policy makers, environmental groups, project developers, energy companies and investors to obtain a balanced view of the issues, the relevant problems and the potential benefits from using both first and second generation biofuels.

He persuaded the Rockefeller Foundation to support the activity by sponsoring the meeting, which was then held over a 5-day period in their Conference Centre in Bellagio, Italy.

His next step was somewhat less impressive in that, on the way to Bellagio, he very unfortunately became indisposed and was unable to attend the meeting at all. But thankfully he has now bounced back to full health and is actively pursuing the cause once again - backed up by the Sustainable Biofuels Consensus document completed in his absence.

The Issues

It is true that the increased production of biofuels has distorted some commodity prices and therefore contributed to recent price increases in grains and vegetable oils. However other factors, such as recent droughts, low food stocks and surging demand for meat and milk products in Asia, have probably played a far greater role. The higher world energy prices have also pushed up the costs of food-crop production (including fertilizers), processing and distribution. But in the media, biofuels tend to take the full brunt of the criticism for all of these woes.

Biofuels presently account for less than 2% of liquid transport fuels and take up well below 1% of world agricultural land. This may seem like a small share, but at over 1 million barrels of oil per day equivalent, they have contributed to meet around 30% of the growth in global demand in liquid transport fuels over the past three years and thus made a significant contribution to the balance of the oil market.

It is easy for politicians to over-promote biofuels, given that their constituencies like the concept of simply substituting petroleum products with another type of liquid fuel without having to buy a smaller car or change their driving habits. However the high national costs of various agricultural subsidies necessary to support biofuels in the North, have largely been ignored in the debate. Also for some biofuels, greenhouse gas emission reduction is not always as good as was commonly thought, when demonstrated using complete life cycle analyses. Land use change and deforestation, additional water use, genetic modification, increased fertiliser and chemical inputs, all raise questions as to the longer term sustainability of energy crop production. Interestingly, the same arguments are rarely equally used for increased food production, as exemplified by only around 10% of palm oil being used for biodiesel and the rest for cooking oil.

Potential Solutions

In some tropical/sub-tropical regions of the South where arable land for sugarcane production is available (from improved land management rather than from deforestation), local development opportunities should not be discounted. If biofuels can be produced in a sustainable way, and be certified as such according to an agreed international standard currently being debated, then they can offer valuable economic opportunities, particularly to developing countries. Trade, equity, sustainable development and energy security are all related issues.

In the longer term second generation biofuels from ligno-cellulosic, non-food feedstocks (straw, woody biomass residues, vegetative grasses) hold promise and should address most of the current concerns but they remain relatively costly options, even after 35+ years of RD&D. Several demonstration projects are under way and major deployment of commercially viable second generation biofuels may be just a few years off.

The aim should be to progressively phase out subsidy systems for the less sustainable biofuels and focus on incentives to bring forward second generation production of both ethanol and synthetic diesel as well perhaps a "third generation" from algae and using advanced bio-technoloiges. Recent increases in public and private research investment, including by the biotechnology industry may help to reduce the production costs.

Development of flex-fuel vehicle engines that run on low- or high-level blends of ethanol or gasoline, has been a major step forward to support the increased uptake of biofuels. With over 6 million such vehicles already running on the roads of Brazil, the U.S., Sweden and elsewhere, and more auto manufacturers showing interest, demand is likely to continue. Plug-in hybrid, flex-fuel engine vehicles may be the way of the future.

However one key point to note is that energy-efficiency measures to reduce road transport demand must still be encouraged.

Summary

Overall the Sustainable Biofuels Consensus highlights the opportunities that sustainably produced biofuels could bring if managed carefully. South to South collaborations (as for example Brazil recently announcing a major investment in sugarcane production and ethanol processing in Ghana) can provide positive benefits to all parties. Coupled with the current push to provide improved crop species, better knowledge of fertiliser use and water management for food crop production, it could be that well managed and sustainably produced biofuels, although certainly not a panacea for rising oil demand, could make some contribution towards sustainable development, energy security, equity and greenhouse gas abatement.

Click here to download the 8-page Sustainable Biofuels Consensus.

Ralph Sims is Professor of Sustainable Energy at Massey University, New Zealand where he began his research career producing biodiesel from animal fats in the early 1970s. He is currently based at the Renewable Energy Unit of the International Energy Agency, Paris. He was the Coordinating Lead Author of the "Energy Supply" chapter of the IPCC 4th Assessment Report and is a Companion of the Royal Society. His many publications on energy and climate change mitigation include the book "The Brilliance of Bioenergy - in Business and in Practice."



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