Probing biology's dark matter: new device makes study of microbes more accessible

Microbiologists have coaxed less than one percent of the bacterial species that inhabit natural environments into growing in culture. The study of these tiny organisms promises to bring breakthroughs in many science and technology fields, in particular in the bioconversion of biomass to useful products (previous post, here and here). But the vast majority of microbes are notoriously resistant to growing in laboratory cultures because they are so intricately linked to their own unique ecosystems. However, a new microfluidics device created by researchers from the Howard Hughes Medical Institute (HHMI) and Stanford University may help scientists who want to identify and characterize new microbes circumvent the need to culture them at all.

HHMI investigator Stephen R. Quake and Stanford collegues report their research [*abstract] on the device in the July 17, 2007, issue of the Proceedings of the National Academy of Sciences (PNAS). The findings have far-reaching implications for the rapidly developing field of microbial ecology, as well as advancing microfluidics technologies, which could do for biology what silicon chips did for electronics. Quake and his colleagues have already used the device to analyze a rare bacteria found in the human mouth, using just a single cell.

Various methods have given scientists a glimpse of the profound diversity that characterizes different microbial worlds. One approach is to look for variations in the sequence of a specific gene found in all microorganisms; another is a complete inventory of all the pooled genes in a microbial community. These types of studies, however, yield few insights into the character of individual members of a microbial ecosystem, leaving most species almost entirely enigmatic.

Those unstudied organisms are biology's 'dark matter', Quake says. Like the dark matter that astronomers can only infer must exist in the universe, these organisms have never been studied directly. Quake and his colleagues hope their new technology will change that.

We are hoping to open a whole new chapter in how one understands the microbial universe. Microfluidic tools can give us direct access to this dark matter. - Stephen R. Quake, Howard Hughes Medical Institute

Quake's research lies at the nexus of physics, biology, and biotechnology. His microfluidics chips, which he designs to tackle problems in fields including structural genomics, systems biology, microbial ecology, and synthetic chemistry, are akin to having a fully automated laboratory on a postage stamp-sized wafer. Remember the early days of electronics with all of those big vacuum tubes and wires. Next came the transistor and finally the silicon chip, which dramatically revolutionized computers and modern electronics. Microfluidics is following the track of silicon chips and promises to revolutionize biology in the same manner:
energy :: sustainability :: biomass :: bioenergy :: biofuels :: biogas :: biohydrogen :: microbes :: enzymes :: microbiology :: genomics ::

The microfluidic chip designed by Quake and his colleagues for the current study is equipped with tiny chambers and valves that allow researchers to isolate microbes at the nanoliter scale. Because each microbe is isolated in a vanishingly small volume of liquid, the concentration of its genetic material within that solution is actually quite high - meaning Quake and his colleagues can easily amplify and analyze the genome of an individual cell, eliminating the need to persuade the organism to multiply in a laboratory culture. The chip offers the potential to discover untold new species of microbes lurking within deep sea vents, ordinary dirt, toxic sludge, or virtually any environment.

To demonstrate the power of the new device, the scientists first used it to target a possible new phylum, of which one member is a rod-shaped bacterium that live between the gums and teeth of humans. The candidate phylum, called TM7, has no cultivated or sequenced members. The scientists demonstrated that they could inject a solution containing multiple types of microbes into a chip, and manipulate tiny valves to direct individual rod-shaped bacteria into miniature chambers. Once individual microbes were isolated, the researchers could extract the DNA and amplify it using routine methods.

In this way, the researchers were able to sequence and assemble more than 1,000 genes, providing insight into the physiology of this previously unstudied group of bacteria. Most TM7 genes, they found, had remarkably little similarity to genes in known bacterial groups. But some of the genes hinted at interesting aspects of the organism's biology, such as an unusual gliding motion that groups of TM7 bacteria might use to get around, and a gene shared with bacteria known to cause chronic inflammation.

Just as importantly, the researchers say, they have demonstrated the success of their new technology in analyzing a rare component of a complex microbial community - and there is plenty more to explore. Quake's team has already begun using the chip to isolate, identify, and sequence communities of microbes that reside in termite hindguts (and that have attracted attention for their potential usefulness in breaking down cellulose), and his lab at Stanford is custom building chips for other scientists interested in pursuing any culture-resistant microbe or discovering the dark matter of a specific environment.

Picture: colonies of recombinant Streptomyces bacteria are designed to produce enzymes called cellulases. With these enzymes, the bacteria can break down cellulose on the way to producing ethanol. Courtesy of NREL/U.S. Dept. of Energy/Photo Researchers.

References:
Stephen R. Quake, et. al. "Dissecting biological "dark matter" with single-cell genetic analysis of rare and uncultivated TM7 microbes from the human mouth" -
PNAS, July 17, 2007, vol. 104, no. 29, 11889-11894, Published online before print July 9, 2007, 10.1073/pnas.0704662104

Eurekalert: Probing biology's dark matter - July 19, 2007.

Biopact: Entomologists discover cellulase genes in termite guts - February 28, 2007

Article continues

Brazilian government to outlaw sugar cane planting in Amazon and Pantanal

The Brazilian government announces [*Portuguese] a new set of measures to get rid of the many misunderstandings surrounding the country's sugar cane ethanol, once and for all. Part of the new legislation will be largely symbolic.

In some circles and amongst the public at large, there is a serious lack of knowledge about the Brazilian ethanol industry. People think the sugar cane from which the fuel is derived, is grown in the Amazon rainforest or contributes to its deforestation. Nothing is further from the truth. The vast bulk of the cane is grown 1000 miles south of the Amazon in the south-central state of São Paulo, and far away from biodiversity hotspots like the Pantanal (map, click to enlarge). There is no indication that second-order effects from the expansion of sugar cane plantations results in increased deforestation (and as such, let's not forget that, over the past few years, the current Brazilian government succeeded in reducing deforestation rates by 50% - a major effort and historic trend-reversal lauded by even the most critical environmentalist). Even U.S. energy officials - who have not the slightest interest in saying so, on the contrary - recently stressed that Brazilian biofuels have no impacts on the rainforest (earlier post).

In Brazil, there are approximately 440 million hectares of arable land. The sugar cane industry uses up only 1 per cent of this area (but yields a tremendous amount of energy that has made Brazil independent of oil imports). Still, some groups who work against Brazil's successful model - which it wants to export to poor developing countries to their great benefit - are deliberately creating a false image of this sector. These groups include some players of the oil industry, a select club of radical environmentalists, and lobbyists from the US and EU ethanol industry, who fear that the much more efficient, sustainable and competitive Brazilian fuels will replace theirs. Indeed, sugar cane ethanol has an energy balance of between 8 and 10 to 1, corn ethanol has an energy balance of 1 to 1, with some even finding a negative balance; likewise, cane ethanol reduces greenhouse gas emissions by up to 80% compared to gasoline, for corn ethanol the reduction is marginal, at around 0 to 10 per cent. In short, as independent scientists have repeatedly said: Brazilian ethanol is largely sustainable, helps tackle climate change and is highly energy efficient (see here and here); corn ethanol is neither).

The Brazilian government, and president Lula in particular, have tried their best to explain the reality of the sugar cane industry in the country, but some misunderstandings seem to persist. For this reason, Brazil will now explicitly outlaw the growing of cane in both the Amazon and the Pantanal. This step is an international marketing effort needed to convince the rich countries of the benefits of trading and importing Brazilian biofuels. Experts are already convinced of the many advantages of such a trade, but now the uninformed, the unwilling and the anti-Brazilian lobbies must be countered.

Zoning
The legislation will result in the production of an agricultural zoning-map that will clearly delineate areas where sugar cane will be allowed to grow. For the time being, measures to penalise those who do not follow the zoning order have not been outlined. The map will be ready within one year.

Speaking to an audience of international journalists at a conference on Brazilian biofuel exports to Europe, Agriculture Minister Reinhold Stephanes announced the decision, and added that areas other than the Amazon will be studied for protection:

This is a governmental decision. We are going to create a zoning system for sugar cane, with a restrictive map. This map will outlaw every possibility of establishing plantations in the biome of the Amazon and the Pantanal. - Reinhold Stephanes, Minister of Agriculture of Brazil

The law is largely symbolical, because it makes no economic nor agronomic sense to grow cane in the rainforest anyways, the climate and soils of which are not conducive to a good crop. But such a law is most certainly welcome.

A more important pillar of the zoning map will consist of a set of incentives funded by the federal government to stimulate sugar cane growers to plant the crop in degraded areas, like old pastures. There are millions of hectares of such degraded pastures laying around unproductively today. Planting sugar cane on them would partly restore their health.

Finally, and crucially, by December of this year, the government will finalise its social and environmental sustainability criteria for both ethanol and biodiesel, which will facilitate the international trade of these biofuels:
energy :: ethanol :: biodiesel :: biomass :: bioenergy :: biofuels :: sugar cane :: Amazon :: Pantanal :: environmental sustainability :: social sustainability :: pasture :: Brazil ::

"The basic certification documents will soon be finalised and distributed amongst the producers", the Agriculture Minister said.

President Lula, who, after a long campaign, finally convinced the EU of the many benefits of Brazilian ethanol as compared to EU- and US-produced biofuels, has developed a smart discourse to counter prevailing misunderstandings about the sector that has made his country the focus of international attention. This has even turned Sweden, a world leading example of a country that makes intelligent green and sustainable energy choices, into an outspoken ally of the Brazilian vision (earlier post).

Both at the landmark International Conference on Biofuels held recently in Brussels, as well as in numerous speeches, columns and televised debates, the president has routinely summarized the facts:

• that cane is not grown in the Amazon, and that it never will, simply because of agro-technical reasons;
• that labor conditions have been historically bad, but that progress towards the humanisation of the sector is being and will be made (cane cutters are now much better protected by new laws and receive far better wages than ever before - but more is needed to improve the working conditions);
• that the benefits of Brazil's model far outweigh the disadvantages (the substantial reduction of greenhouse gas emissions helps protect the environment because unmitigated climate change will be disastrous for the entire planet and all of its biodiversity, not only for the Amazon or the Pantanal);
• that the Brazilian model can be exported to poor developing countries, most notably African, who stand to benefit massively from it

A whole set of objective and scientifically sound arguments.

When it comes to food versus fuel, Lula has stressed over and over again, with clear scientific and sociological backing, that food insecurity is not a matter of a lack of food, but of a lack of income to buy food (earlier post). Sugar cane ethanol does not in any way threaten food output or prices, on the contrary, it allows farmers to boost incomes and countries to cut expensive oil imports. This may benefit the poor (the vast majority of whom rely on agriculture and who eat more than sugar alone). However, there is no denying that the utilization of food crops such as corn - which should never be used for the production of ethanol because they are inefficient, don't reduce greenhouse gas emissions, and have a very weak energy balance - can have disastrous consequences for the millions of poor who depend on it for their daily needs. Sugar cane is not corn. It cannot be repeated often enough.

One of the more often quoted points made by Lula is of a mildly ironic and historiographic nature. It goes something like this:

The Portuguese who came here first and who introduced sugar cane to Brazil, were very intelligent people. 470 years ago, they discovered the Amazon, and they have never planted a single cane stalk there. They didn't, because the climate and the soil there are simply not suitable. Instead, they started planting cane a thousand miles south, in São Paulo, where it still grows today.

Earlier, Lula often spoke in terms of 'national pride' when it comes to Brazil's successful biofuels industry. Today, he speaks in terms of 'national sovereignty' which is boosted by the fuel, but also of 'international solidarity'. It is taken this seriously. And if it is up to Lula - a pragmatic leftist, and president of the largest African community oustide the African continent - the benefits of Brazilian biofuels will soon be exported to some of the poorest countries in the world, most notably to Africa. There, they can strengthen economies and rural population's livelihoods, cut foreign energy dependence, and indeed, beef up much needed 'sovereignty'. For Lula, biofuels are a matter of international cooperation, fair play, and solidarity. The Biopact shares this vision, and hopes it can contribute to developing it further.

References:
EthanolBrasil: Governo veta plantio de cana na Amazônia - July 18, 2007.

Biopact: Brazilian ethanol is sustainable and has a very positive energy balance - IEA report - October 08, 2006

Biopact: Nature sets the record straight on Brazilian ethanol - December 09, 2006

Biopact: Two handy books answer FAQs on Brazilian ethanol - May 22, 2007

Article continues

Green Power Generators unveils dedicated biodiesel gensets for entertainment industry

Green Power Generators, a new company specializing in custom built biodiesel fueled generators, today announced it made available a new line of generators designed to dramatically reduce carbon emissions in both small and large-scale events and productions. Derived from biological sources such as vegetable oil, biodiesel fuel is safe to handle and as biodegradable as sugar.

GPG has chosen to highlight designs first for members of the entertainment industry, but the generators will be of equal interest for any business that involves high energy consumption. To make its case, GPG refers to a 1998 biodiesel lifecycle study, jointly sponsored by the U.S. Department of Energy and the U.S. Department of Agriculture, concluded biodiesel reduces net carbon dioxide emissions by 78% compared to petroleum diesel.

Quick Facts about the biodiesel generators:

• GPG generators feature Cummins Tier-3 engines that meet the most stringent emissions standards set forth by the EPA. Only 1% of generators currently used are Tier-3.
• generators are rated to operate smoothly in high and low temperatures.
• feature Movie Quiet design utilizing a three-stage insulation process for sound reduction.
• analog engine controls with individual digital meters for amps, voltage and hertz allow for reliability and ease of operation.
• GPG’s generators feature Dual-Redundant voltage regulators with a changeover switch. If one regulator fails, the user can switch over to a second regulator within seconds.
• electric priming feature that allows the engine to be primed of fuel within minutes.
• variable speed hydraulic fan drive utilizing synthetic hydraulic fluid allow for a reduction in change intervals.

In its annual report card issued in November 2006, the UCLA Institute of the Environment put the film industry number two behind the Aerospace industry on the list of industry pollution offenders in California. The potential benefits of GPG’s new generators for the industry are welcomed by environmental experts.

Generators are the biggest polluters on sets, at concerts and events, and we wanted to change that. We hope to pioneer a change in the way we do things in Hollywood, and beyond. We have already been embraced by several environmental non-profits who will help us encourage all large scale productions to use clean burning fuel. - Tomer DeVito, co-founder of GPG and a television commercial and music video producer.

According to Alton Butler, co-founder of GPG and president of Line 204 Studios, GPG’s parent, the industry standard tier-2 diesel engines are not qualified to burn biodiesel. The available industry standard diesel-engine generators can burn only up to 5% bio-diesel (B5). Burning a higher percentage risks losing operators to lose the warranty on the genset. Currently productions don’t have an option for burning cleaner fuels:
energy :: sustainability :: bioenergy :: biofuels :: biodiesel :: generator :: greenhouse gas emissions :: entertainment industry :: Hollywood ::

According to Debbie Levin, president of the Environmental Media Association, "Very few options exist for producers who want to reduce the emissions on their sets. GPG presents a formidable option that should be a no-brainer not only for Hollywood but for any industry that outsources power."

GPG has their own supply of biodiesel fuel, as well as transportation, utility and re-fueling trucks that run on fuel from the same source, ensuring that all measures are taken to prevent unnecessary carbon emissions.

Article continues

FPL Energy teams up with Citrus Energy to make cellulosic ethanol from citrus waste

FPL Energy, LLC, a subsidiary of FPL Group, today announced that it has signed a letter of intent with Citrus Energy, LLC, of Boca Raton, Florida, to develop a commercial scale biorefinery that will convert citrus waste to cellulosic ethanol.

The ethanol plant will be owned and operated by FPL Energy and is expected to produce 4 million gallons (15m liters) of ethanol per year. It will be located on the grounds of a local Florida citrus processor.

Citrus Energy’s mission is to develop fuel ethanol that minimizes environmental impact and cost by using citrus waste and other biomass. FPL Energy, as the largest renewable energy generator in the U.S., is the ideal partner. - David Stewart, president of Citrus Energy

FPL Energy says that ethanol from citrus peel could result in a new Florida industry producing over 60 million gallons of fuel per year, which could replace about one percent of Florida’s annual gasoline consumption. Florida has 100 million citrus trees on 700,000 acres yielding around 5 million tons of citrus waste per year.

Citrus Energy recently received a US$2.5 million grant to study “Fuel Ethanol Production from Citrus Waste Biomass” [*.pdf], from the Florida government under its 'Renewable Energy Technologies Grant Program' (earlier post).

The feedstock
Typically citrus processing waste is dried into citrus pulp pellets (CPP) and fed to cattle. But production of CPP requires a large capital investment by the processor with a negative return on investment. The CPP losses are borne by the main product from citrus, orange or grapefruit juice.

Citrus processing waste, a pectin, cellulose and soluble sugar rich mixture of peel, segment membranes and seeds is thus available at no cost and in large volumes with potentially no transportation costs. This waste citrus biomass stream will be used as a cellulosic ethanol feedstock. According to Cirtus Energy, citrus waste feedstock can produce ethanol at significantly lower cost than corn feedstock and is the most economically attractive and technically feasible of the potential cellulosic feedstocks.

The conversion process
The project's competitive advantage is based on technology which allows the ethanol production process to take advantage of a feedstock where the primary costs of growing, harvesting, and collection are supported by the existing product stream.

Comprehensive research, conducted largely at the USDA/ARS Citrus and Subtropical Products Laboratory (Citrus Lab) in Florida provides the technical background for the proposed bio-refinery. The key step is conversion of citrus (primarily orange and grapefruit) processing waste to a mixture of glucose, fructose, galacturonic acid, arabinose, galactose, and xylose by hydrolysis using a mixture of commercial pectinase, cellulase, and beta-glucosidase enzymes. The soluble sugar content in processed citrus waste increases from 23 to 62 percent through this enzymatic hydrolysis process. Fermentation of the sugars is done using traditional brewers yeast and the resulting "beer" has the ethanol separated and converted to fuel grade ethanol using a distillation and dehydration process:

According to Citrus Energy, the economic and environmental advantages of this process are:
energy :: sustainability :: ethanol :: biomass :: bioenergy :: biofuels :: cellulosic :: citrus :: Florida ::

1. Feedstock is available at the plant at no cost with no transportation costs.
2. The feedstock is processed immediately with no requirement for storage.
3. Unlike lignocellulosic feedstocks, this cellulosic process is commercially viable in the short term.
4. Rural economic development including local energy expenditures; cleaner fuel; and rural employment.
5. No toxins produced. The acid or high temperature pre-treatment used in conversion of other cellulosic feedstocks for ethanol production can cause toxins which raise environmental concerns.
6. Reduced foreign oil dependence and improved trade deficit.
7. Energy Security through domestic fuel source; local energy security.
8. Less combustion related emissions of global climate change (greenhouse) gases.
9. Environmental protection and improvement including less toxic emissions than fossil fuels.
10. 10. Biodegradability of ethanol leaks and spills when compared to MTBE.

Citrus Energy sees itself as strategic player in the cellulosic ethanol opportunity because of the following factors:

• A citrus waste feedstock that allows an economically attractive cellulosic ethanol revenue stream to be the basis for broadening the feedstock supply to energy crops.
• The ability to raise funds for new cellulosic ethanol opportunities based on a profitable business and proven economic and technical success in cellulosic ethanol production.
• A four month window (the citrus off-season) to use the enzymatic hydrolysis, fermentation, and distillation equipment at the production facility as a large scale experimental operation for energy crop research. This capital equipment is available at no cost as the financial burden is being carried by the citrus ethanol product.
• An opportunity to have significant state and federal funding assistance to grow the energy crops on the tens of thousands of acres of phosphate mined lands that require remediation to be returned to food production agriculture. This could allow Citrus Energy to continue in its "no cost/low cost" biomass feedstock model.

FPL Energy is an energy supplier utilizing clean fuels such as natural gas, wind, solar, hydroelectric and nuclear to generate electricity. It is the U.S. leader in wind energy with 49 wind facilities in operation in 15 states. It is a subsidiary of FPL Group, (NYSE: FPL) one of the nation's largest providers of electricity-related services with annual revenues of nearly $16 billion. FPL Group's principal subsidiary is Florida Power & Light Company, one of America's largest electric utilities, serving 4.4 million customer accounts in Florida.

Picture: citrus peel waste like this will beused for ethanol production rather than cattle feed, its current use. Credit: Bill Widmer.

References:
Cirtus Energy: “Fuel Ethanol Production from Citrus Waste Biomass” [*.pdf].

Article continues

E.ON UK submits application for 25MW biomass plant

E.ON UK, an arm of German energy giant E.ON, announces it has submitted a scoping statement to build a £60 million (€89.2 /US$123.2 m) dedicated biomass power station in Sheffield. Rated at 25MW, the new renewable energy plant would produce enough power for around 40,000 homes by burning a combination of recycled wood and specially grown energy crops such as willow or tropical elephant grass (Pennisetum purpureum).

This is the second of E.ON UK's biomass developments, with construction nearing completion at the UK's largest dedicated biomass power station at Steven's Croft near Lockerbie in Scotland. That plant is rated at 44MW, generating enough electricity to power 70,000 homes (earlier post). The company started testing the facility yesterday. Besides building dedicated biomass power plants, E.ON also co-fires biomass at two of its coal power stations.

The Sheffield plant would displace around 80,000 tonnes of carbon dioxide emissions every year - the equivalent of taking more than 20,000 cars off the UK's roads each year - and is expected to create 20 full-time jobs.

[...] biomass development is a great opportunity to make a contribution to the Yorkshire and Humber Region's target of reducing greenhouse gas emissions by at least 20% by 2010. It's through projects like this that we can change the way that we produce energy in the UK, helping keep the lights on at the same time as reducing the impact we have on our environment. And it's not just the environment that will benefit - we're expecting there to be a number of benefits to the local community in terms of new jobs and investment in the area. - Dr Nilton Chan, E.ON UK Project Developer

In addition to the displacement of carbon emissions, the company is investigating the potential for supplying renewable heat to neighbouring commercial and industrial establishments, further strengthening the project's efficiency:
energy :: sustainability :: climate change :: coal :: co-firing :: biomass :: bioenergy :: energy crops :: United Kingdom ::

The scoping statement has been submitted to statutory consultees, including Sheffield City Council and Rotherham Metropolitan Borough Council, and outlines the proposed project including the potential environmental impact of the new development.

It is hoped that a full planning application will be submitted to the council later this year, following the completion of initial design activities and environmental studies.

If the project gets the green light, construction is expected to start early in 2009, with the first power being produced in 2011.

Local people will get the opportunity to learn more about the proposed development at a public exhibition planned for later in the year.

In addition to Sheffield City Council and Rotherham Metropolitan Borough Council, statutory consultees include Darnall Ward, English Nature, English Heritage, Environment Agency, Groundwork Sheffield, Sheffield Wildlife Trust, Highways Agency, South Yorkshire Forest Partnership, Tinsley Forum and Yorkshire Forward.

E.ON is co-firing biomass alongside coal at two of its power stations, building the UK's largest dedicated biomass power station in Scotland and owns the largest traditional hydro power station in England and Wales. The retail business, branded Powergen, is a leading energy supplier in the UK, with around 8.5 million electricity and gas customer accounts, both domestic and SME.

Picture: a stand of elephant grass. Pennisetum purpureum is a species of grass native to the tropical grasslands of Africa. It is a tall perennial plant, growing to 2-4.5m tall (rarely up to 7.5 m), with razor-sharp leaves 30-120 cm long and 1-5 cm broad. It has a very high productivity and has received considerable research attention because of its potential as a dedicated biomass crop.

References:
E.ON UK: E.ON UK gets the ball rolling on biomass power station at Blackburn Meadows in Sheffield - July 18, 2007

E.ON UK: Next stages of testing to be undertaken at E.ON's Steven's Croft biomass power station - July 19, 2007

Article continues

ESV Group signs 60yr lease for major biofuel storage and logistics facilities at Terneuzen port

Now that the EU is accepting the vision that it will have to import biofuels, the need for 'bioports' is becoming more tangible. The Netherlands and Belgium, with their many sea ports, are preparing for the creation of such logistical hubs that will import, store, process and distribute solid and liquid biofuels and bioenergy feedstocks (earlier post and here).

In this context, the ESV Group plc, a logistics, trading and biofuel farming company, announces it has signed a sixty year lease agreement with the Port Authority of Zeeland Seaports and Exploitatiemaatschappij Schelde Maas Beheer BV on 98,000 square metres of land in the port area of Terneuzen.

Via ESV Bio-Africa Lda, the group has recently started establishing a 11,000 hectare jatropha plantation in Mozambique. The vegetable oil that can be used as a biodiesel feedstock is meant for exports to the EU.

These activities are yet another indication that Africa's biofuel potential is beginning to be recognized. By 2050, the continent can yield more than 400 EJ of sustainably produced biofuels, without threatening forests or the food, fuel and fiber needs of rapidly growing populations (earlier post). Consequently, a large potential for global bioenergy trade has been identified by researchers (more here).

ESV's lease in the Netherlands, at the Axel Plain, allows for:

• the Zeeland Sea Ports Authority development of a 200 metre quay for vessels of maximum length of 180 metres and maximum draft of 11.5 metres
• a separate jetty for tanker barges and coasters
• storage and logistic facilities for a minimum of 600,000 metric tons throughput of vegetable oil, ethanol and clean minerals per year with an overall storage capacity of 176,000 cubic metres for vegetable oils, ethanol and clean minerals per year

Additionally, ESV will have a first right of refusal on an initial 30,000 square metre plot of land adjacent to the Axel Plain. The Company expects the facility to be operational by mid 2009. According to Masoud Alikhani, Chairman of ESV, Terneuzen is strategically excellently positioned to provide a central hub for supplying the European biofuel market:
energy :: sustainability :: biodiesel :: biomass :: bioenergy :: biofuels :: trade :: logistics :: port :: Mozambique :: Netherlands ::

The facility will not only provide the Northern European access point for shipping in vegetable oil from ESV's own production projects but also for other biofuel suppliers both within and outside of Europe.

ESV was established as a logistics and trading company and is in the process of re-positioning itself as a major provider of raw vegetable oil for supply to the emerging European biodiesel industry, the European Union having targeted its biodiesel requirements for 2010 as 10.2 million metric tonnes. ESV currently has substantial business interests in farming and farming logistics. Its main operations are conducted through:

• A purchase agreement with Agri-Ukraine Ltd, Cyprus who operates a substantial 12,000 hectare farming operation in Poltava;
• A management agreement with Dnipro Cargo Ltd, Cyprus whereby ESV Group Plc manages a grain terminal at Kherson sea port, a strategically located facility on the Black Sea; and
• ESV Bio Africa Lda which is developing a major jatropha plantation in Mozambique for the production of raw vegetable oil.

References:
ESV Group plc: Mozambique biofuel project.

Port of Zeeland - Terneuzen and Vlissingen, website.

Article continues

UNCTAD: poorest countries need investments in science and technology

The United Nations Conference on Trade and Development (UNCTAD) today released its annual Least Developed Countries Report 2007 [*.pdf], in which it calls for a boost in investments in science, technology and innovation (STI) in the poorest countries. After years of focusing attention on market reform and economic liberalization (1990s) and then on 'good governance' (2000s), the least developed countries (LDCs) now need more knowledge-based development if they want to escape the poverty trap. LDCs are defined as the 50 poorest countries - the majority of them in Africa - whose combined population totals 767 million.

Over the past 25 years, STI projects and knowledge-based development initiatives have received marginal funds from the major international development agencies (e.g. in 2003–2005 'good governance' received $1.3 billion, agricultural extension a meagre $12 million...). Now, the UNCTAD sees investments in technology, science and learning environments as crucial for poverty reduction strategies.

Comparison of the capability of countries to innovate: a huge gap between highly developed and least developed countries (click to enlarge).

The overal argument of the UNCTAD's analysis is that:

unless the LDCs adopt policies to stimulate technological catch-up with the rest of the world, they will continue to fall behind other countries technologically and face deepening marginalization in the global economy. Moreover, the focus of those policies should be on proactive technological learning by domestic enterprises rather than on conventionally understood technological transfer, and on commercial innovation rather than on pure scientific research.

The report also stresses that sheer economic liberalization - long the mantra of development agencies - is no guarantee for successful development, on the contrary:

Since the 1990s most LDCs have undertaken rapid and deep trade and investment liberalization. Liberalization without technological learning will result, in the end, in increased marginalization.

The report contains many interesting observations that can directly be linked to the biofuels and bioenergy industry that is emerging in LDCs. Such an industry holds the potential to boost local development, but a precondition is that the sector becomes knowledge and technology-driven instead of merely relying on static comparative advantages of LDCs.

The subject of knowledge, technological learning and innovation is a large one, and the important UNCTAD report is the first to address the issue in the context of the least developed countries. It focuses on five issues:

• the extent to which the development of technological capabilities is occurring in LDCs through international market linkages, particularly through international trade, foreign direct investments and licensing
• the way in which STI issues are currently treated within LDCs and how STI policies geared towards technological catch-up could be integrated into the development strategies of LDCs
• current controversies about how stringent intellectual property rights regimes affect technological development processes in LDCs and policy options for improving their learning environment
• the extent of loss of skilled human resources through emigration and policy options for dealing with that issue
  
• how overseas development aid is supporting technological learning and innovation in the LDCs and ways to improve it

Technological change in LDCs
So what kind of strategies does the UNCTAD recommend, in order to boost STI and knowledge-based development? First of all, it is important to look at how technological change happens in LDCs, because the process differs considerably from that in highly developed countries:
sustainability :: bioeconomy :: development :: science :: technology :: innovation :: good governance :: development aid :: poverty alleviation :: Africa :: UNCTAD ::

Processes of technological change in rich countries, where firms are innovating by pushing the knowledge frontier further, are fundamentally different from such processes in developing countries. There, innovation primarily takes place through enterprises learning to master, adapt and improve technologies that already exist in more technologically advanced countries:

The central issue is not acquisition of the capability to invent products and processes. Rather, policies to promote technological change in LDCs, as in all developing countries, should be geared to achieving catch-up with more technologically advanced countries. That is, they are concerned with learning about and learning to master ways of doing things that are used in more technologically advanced countries.

It can hardly be expected that an LDC is already knocking at the frontiers of technological breakthroughs. Creative technological innovation also occurs when products and processes that are new to a country or an individual enterprise are commercially introduced, whether or not they are new to the world, the report says.

In short, innovation occurs through "creative imitation", as well as in the more conventional sense of the commercialization of inventions.

Different economic sectors are based on unique processes of technology adoption. For agriculture, the type of technological effort that is required is influenced by agriculture's high degree of sensitivity to the physical environment (circumstantial sensitivity). The strong interaction between the environment and biological material makes the productivity of agricultural techniques, which are largely embodied in reproducible material inputs, highly dependent on local soil, climatic and ecological characteristics. This means that there are considerable limits to the agricultural development which can occur simply through the importation of seeds, plants, animals and machinery (agricultural technology) that are new to the country.

What is required is experimental agricultural research stations to conduct tests and, beyond that, indigenous research and development capacity to undertake the inventive adaptation of prototype technology which exists abroad – for example, local breeding of plant and animal varieties to meet local ecological conditions. Without such inventive adaptation capabilities, knowledge and techniques from elsewhere are locally of limited use.

For industry and services, such circumstantial sensitivity is less important, but nevertheless technological effort is required because technology is not simply technological means (such as machinery and equipment) and technological information (such as instructions and blueprints), but also technological understanding (know-how). The latter is tacit and depends on learning through training, experience and watching.

The development of firm-level capabilities and support systems is vital for successful assimilation of foreign technology. There's a difference between 'core competences', 'dynamic capabilities', and 'technological capabilities':

Core competences
Core competences refer to the knowledge, skills and information to operate established facilities or use existing agricultural land, including production management, quality control, repair and maintenance of physical capital, and marketing.

Dynamic capabilities
Dynamic capabilities refer to the ability to build and reconfigure competences to increase productivity, competitiveness and profitability and to address a changing external environment in terms of supply and demand conditions.

Technological capabilities
Technological capabilities as such are particularly important for the process of innovation. The effective absorption (or assimilation) of foreign technologies depends on the development of such dynamic technological capabilities. R&D can be part of those capabilities, but only a part. Design and engineering capabilities are particularly important for establishing new facilities and upgrading them.

Beyond this, production processes involve various complex organizational processes related to the organization of work, management, control and coordination, and the valorization of output requires logistic and marketing skills. All these can be understood as part of “technological learning” in a broad sense.

Context: policy, institutional framework
The enterprise (firm or farm) is the locus of innovation and technological learning. But firms and farms are embedded within a broader set of institutions which play a major role in these processes. In advanced countries, national innovation systems have been established to promote R&D and link it more effectively to processes of innovation. In LDCs, what matters in particular are the domestic knowledge systems which enable (or constrain) the creation, accumulation, use and sharing of knowledge.

Those systems should support effective acquisition, diffusion and improvement of foreign technologies. In short, there is a need to increase the absorptive capacity (or assimilation capacity) of domestic firms and the domestic knowledge systems in which they are embedded.


1. Building technological capacilities through international market linkages
The level of development of technological capabilities in LDCs is very weak, the report notes. Indicators to show this are scarce and not wholly appropriate. But an examination of where LDCs stand on some of the key indices reveals a dismal performance from an international comparative perspective.

The domestic knowledge systems in the LDCs are very weak and the level of technological capabilities of domestic enterprises is very low. Initiating a sustainable process of knowledge accumulation that could accelerate the development of productive capacities in the LDCs will not be a simple task, because classic recipes have failed:

Technological assimilation and absorption in LDCs through market mechanisms are taking place only to a very limited degree, as reflected in the weak development of technological capabilities and productive capacities. For some channels, notably capital goods imports, the scale of interaction in relation to GDP is much too low. For other channels, notably FDI and exports, the scale of interaction is actually high, but the learning effects of those channels are low. Thus, the growing integration of LDCs into international trade and investment flows since the 1980s has not prevented their marginalization from technology flows.

But the task is not impossible either. According to the UNCTAD, a strategy for catch-up needs to focus on the following fields:

• building of an endogenous knowledge base, which takes into account informal knowledge systems as they develop in the informal economy (including such things as creative repair, reprocessing and recycling of artefacts, including in some cases complex technologies)
• traditional knowledge plays a crucial role in various sectors, including agriculture, health and creative industries.
• learning through international linkages. This latter option is seen as vital by the UNCTAD.

So how can poor countries tap these international knowledge and technology pools?

The report looks at different options, including (1) imports of capital goods, (2) learning by exporting, (3) foreign direct investment, and (4) licensing.


Imports of capital goods
By far the most important source of technological innovation in LDCs, as perceived by firms themselves, is new machinery or equipment. Most of the machinery and equipment operated in LDCs is imported, and therefore imports of capital goods, and their effective use, are overall the main source of innovation for firms in LDCs.

But capital good imports by LDCs have lost momentum over the last 25 years. They have been hampered by their premature de-industrialization process, the slow progression of the investment rate, the composition of their fixed capital formation (with a low share of machinery and equipment) and balance-of-payments restrictions. The sluggishness of those imports means that domestic firms are upgrading their processes and products only marginally. Importing relatively few capital goods implies that LDC firms are forgoing the potential technological learning and adaptive innovation associated with a greater volume of imports of technology embodied in those goods.

Different countries often limit their imports of capital goods to develop the most obvious sectors (a country with mining potential imports mining machines, oil rich countries import oil processing tools, etc...). But, interestingly, when it comes to agriculture and ICT - crucial for all countries, regardless of their other natural resources - the report notes:

As a group LDCs imported relatively little agricultural machinery and ICT capital goods. This indicates, on the one hand, the low level of technological development of those countries’ agriculture and, on the other hand, the still incipient penetration by the recent wave of ICT and ICT-based innovation.

Exports and the role of global value chains
The report suggests that LDC firms can develop their technological capabilities through the market linkages they develop with their downstream customers, including in particular the foreign ones. Integration into global value chains (GVCs) often represents one of the very few options for LDC firms and suppliers to secure access to international markets and innovative technologies, and to learn by exporting.

However, the upgrading process is fraught with difficulties and obstacles, which are particularly great for LDC firms. International value chains are increasingly driven by buyers and downstream lead firms. The latter have the power to set the standards (technical, quality, environmental) that must be met in order to participate in the chain. Chain leaders, however, rarely help producers to upgrade their technological capabilities so that they are able to fulfil those requirements. Barriers to integrate such global value chains are therefore becoming higher.

In most cases LDCs have increased their specialization in relatively basic products at a low stage of processing. Those export patterns indicate that little technological upgrading has taken place recently among LDC firms, irrespective of their participation in GVCs.

Foreign direct investment
It is generally contended that the arrival of transnational corporations leads to technological upgrading of domestic firms through technological spillovers via imitation, competition, training, labour mobility, backward and forward linkages, and exports (which entail exposure to the technology frontier). Those spillover effects have the potential to increase the productivity of other firms.

However, the materialization of the potential positive impacts of FDI on knowledge accumulation in host countries hinges on a large number of conditions, including their structural characteristics, the type of insertion of transnational corporations in host economies, their job-generating impact, and the direct consequence of their entry for domestic firms.

The report notes that foreign direct investments in the LDCs have sped up markedly over the past few years, but as such this is not sufficient to guarantee technology spill-overs to local firms:

There is little evidence of a significant contribution by FDI to technological capability accumulation in LDCs. This is not due to those countries’ insufficient 'opening' to foreign investors, given the policy changes that they have enacted since the 1980s and the substantial growth of FDI penetration since the 1990s. Rather, its limited contribution is due to the type of integration of transnational corporations into host countries’ economies, the sectoral composition of FDI, the priorities of policies enacted by LDCs and the low absorptive capacity of those countries.

Biopact notes that the biofuels and bioenergy potential in many LCDs is large and that part of it may be tapped by foreign companies, which could boost tech transfers via spill-over effects. But in this context, the report issues an interesting warning about what is needed for this to succeed. The lesson, from which parallels to a future biofuels industry can be drawn, comes from the African mining sector:

In African LDCs typically the mineral extraction activities of TNCs are capital-intensive, have little impact on employment, are highly concentrated geographically, have high import content and result in exports of their output as unprocessed raw materials. Most of those operations are wholly owned by foreign investors (rather than joint ventures) and a large share of their foreign exchange earnings is retained abroad. Those operations tend to operate as enclaves since they are weakly integrated into domestic economies, as they have few forward and backward linkages in host economies.

Currently, some of the main channels for potential knowledge circulation between TNCs and domestic firms are largely absent, namely linkages, joint ventures and labour turnover.


Licensing
The use of licensing as a channel for accessing the international knowledge pool (through imports of disembodied technology) is directly related to the income level and technological sophistication of economies. Licensing should therefore be less relevant to LDCs than to other developing countries as a channel for foreign technology diffusion


In conclusion, the report notes that learning associated with international transactions does not occur automatically. Consequently, measures to increase the volume of exports or FDI inflows do not guarantee any increase in learning.

Instead, the learning intensity of such transactions is variable, and the key policy issue is to raise that "learning intensity" – that is, to increase the magnitude of knowledge and skill acquired “per unit” of exports, imports or inward FDI. It is on the learning potential of international linkages that policy – at national, regional and international levels – should focus.

2. National policies to promote technological learning and innovation
The report notes that in current development and poverty alleviation discourses, the need for improved technology and science policies receives little attention.

Partly to blame are the so-called 'structural adjustment programmes', which have been particularly intensely implemented within the LDCs. These programmes, pushed by the World Bank and the IMF and mainly aimed at economic liberalisation, show great omissions of technology issues.

However, the UNCTAD notes that this presents a paradox, because these very institutions have always stressed that promoting technological change is as a key source of economic growth: technological progress is at the heart of efforts by the OECD to promote growth in its own member countries.

The broad revival of interest in policies to promote technological change, partly inspired by the East Asian success, is indicative of wide dissatisfaction with current policies. There is a desire to find a new, post-Washington Consensus policy model, as well as the intuition that it is in this area – promoting technological change – that it is possible to find more effective policies to promote growth and poverty reduction. If LDCs do not participate in this policy trend they will be increasingly marginalized in the global economy, where competition increasingly depends on knowledge rather than on natural-resource-based static comparative advantage.

Policy suggestions
The UNCTAD gives some suggestions as to how LDCs can embed attention for science and technology into their national development strategies. Laying the foundations of such an integrated policy would consist of the following steps.

1. Technological catch-up in LDCs will require the co-evolution of improvement in physical infrastructure, human capital and financial systems, together with improved technological capabilities within enterprises and more effective knowledge systems supporting the supply of knowledge and linkages between creators and users of knowledge.
2. It will also require a pro-growth macroeconomic framework which can ensure adequate resources for sustained technological learning and innovation, as well as a pro-investment climate which stimulates demand for investment.
3. Improving physical infrastructure, human capital and financial systems is absolutely vital because many LDCs are right at the start of the catch-up process and have major deficiencies in each of those areas. Without an improvement in these foundations for development, it is difficult to see how technological change will occur.

These are the foundations. But the report goes further and has identified six major strategic priorities for LDCs at the start and the early stages of catch-up:

1. Increasing agricultural productivity in basic staples, in particular by promoting a new Green Revolution
2. Promoting the formation and growth of domestic business firms
3. Increasing the absorptive capacity of domestic knowledge systems
4. Leveraging more learning from international trade and FDI
5. Fostering diversification through agricultural growth linkages and natural resource-based production clusters (the bioenergy sector can become such a web of diversification)
6. Upgrading export activities

The UNCTAD thinks a systems-approach is needed to get these priorities on track, not so much a simple linear model of innovation processes. This requires measures which go beyond those that are traditionally identified with S&T policies, particularly supporting scientific research, expanding universities and setting up research institutes.

Such a systematic approach should include:

• measures to stimulate the supply side of technology development, but also measures to stimulate the demand for technology development
• measures to lubricate the links between supply and demand, and measures that address framework conditions
• these measures should influence all the interrelated factors that affect the ability and propensity of enterprises (both firms and farms) to innovate.

The relevant STI policy tools thus include explicit measures which are concerned with S&T human resource development, public S&T infrastructure and policies to affect technology imports.

But beyond this they include a number of implicit measures, such as public physical infrastructure investment; financial and fiscal policies which increase the incentive for investment and innovation; trade policy and competition policy; public enterprises and public procurement; and regulation, notably in relation to intellectual property rights and other innovation incentive mechanisms.

Most importantly:

There is above all a need for improved coherence between macro- and microeconomic objectives. Excessive pursuit of macroeconomic stabilization objectives can undermine the development of conditions necessary for productive investment and innovation. In the past the instruments of STI policy were articulated through an oldstyle industrial policy which involved protection and subsidies for selected sectors. Those instruments should now be articulated within the framework of a new industrial policy which is based on a mixed, market-based model, with private entrepreneurship and government working closely together in order to create strategic complementarities between public and private sector investment.

Role of the State
Within such a new industrial policy, the State should act as a facilitator of learning and entrepreneurial experimentation. The private sector is the main agent of change. However, the relevant institutions and cost structures are not given but need to be discovered. The State should facilitate this process and play a catalytic role in stimulating market forces; and it should perform a coordinating function based on an agreed strategic vision of country-level priorities for technological development.

There are significant private sector risks in undertaking pioneer investments which involve setting up activities that are new to a country. Moreover, there are significant spillover effects which are beneficial to the country but which the private entrepreneur cannot capture. This implies the need for a partnership and synergies with the public sector to socialize risks and promote positive externalities. The State stimulates and coordinates private investment through market-based incentives aimed at reducing risks and sharing benefits.

STI governance
The major trend of the past few years in development thinking stressed 'good governance' and ways to strengthen State capacities. And indeed, it could be argued that the suggested STI policies will never work in LDCs because State capacities there are simply too weak.

UNCTAD notes however that policies and projects introduced during the 'good governance' years, were just as complex as those aimed at promoting STI:

There are major deficiencies in governmental capacity in LDCs, particularly with regard to long-neglected STI issues. However, the problem of State capacity needs to be seen in dynamic rather than static terms. Just as firms learn over time by doing, Governments also learn by doing. The key to developing State capacity in relation to STI issues is therefore to develop such capacity through policy practice.

According to the report, States need some room to experiment with these STI policies, in line with countries’ development objectives. For successful catch-up experiences it is important that the Government does not act as an omniscient central planner. Instead, success and good governance for creating technology learning environments will depend on:

• the State formulating and implementing policy through a network of institutions which link government to business.
• the establishment of intermediary government–business institutions
• policies should never favour or protect special interest groups, or support particular firms (“cronyism”)
• the State apparatus itself should undergo the necessary organizational restructuring because technological learning and innovation is naturally cross-sectoral. Merely establishing Science & Technology Ministries won't suffice and can even lead to an overemphasis on science and an underemphasis on innovation at the enterprise level. The appropriate organizational structure for integrating technological development issues into policy processes needs careful consideration.
  

3. Intellectual property rights
The UNCTAD report contains an interesting chapter on how intellectual property rights (IPRs) can contribute to technology learning. But for this lever to bear fruit, players have to go through several complex stages. For the time being, IPRs won't play that much of a role in the least developed countries:

IPRs are unlikely to play a significant role in promoting local learning and innovation in the initiation stage, the point in the catch-up process where most LDCs are now located. Moreover, technology transfer through licensing is unlikely to provide great benefits for LDCs. Even if under certain conditions IPRs were to positively encourage technology transfer through licensing, LDCs are unlikely to become significant recipients of licensed technology. The low technical capacity of local enterprises constrains their ability to license in technology, while the low GDP per capita in LDCs is not likely to stimulate potential transferors to engage in such arrangements. IPRs, particularly patents, promote innovation only where profitable markets exist and where firms possess the required capital, human resources and managerial capabilities.

4. International migration of skilled labor
For biofuels and bioenergy to benefit local communities and LDC economies, it is crucial that local expertise is used, or that it is created. If scientists, engineers and management are recruited from abroad, chances are that knowledge and technology capabilities will not spill-over to local actors. On the other hand, a brain drain of biotechnologists, agronomists and engineers from LDCs to developed countries, jeapordizes the establishment of science and technology-based bioeconomies.

The UNCTAD report sees the importance of these movements of 'brain drain' and 'brain gain', and their impacts on the knowledge stock of LDCs.

International migration of skilled persons in principle contributes to building the recipient countries’ skills endowment, while entailing a loss in the origin country’s stock of human capital. The most important issue for countries’ long-term development is the net effect of migratory flows. LDCs have a low skill endowment. Therefore, the international migration of skilled persons from and to those countries can have a strong impact on their human capital stock.

The human capital endowment of an economy is a fundamental determinant of its long-term growth performance, its absorptive capacity and its performance in technological learning. It is also a requirement for the effective working of trade, FDI, licensing and other channels as means of technology diffusion. In LDCs the major migratory flow of qualified professionals is that of skilled people settling mainly in developed countries.

The costs of emigration can in principle be (partly) offset by other developments, including higher enrolment in tertiary education, an increase in remittances and the eventual brain gain through the return of emigrants, brain circulation by means of temporary return, and creation of business and knowledge linkages between emigrants and home countries (leading to technology flows, investment, etc.). These increased flows in knowledge, investment and trade are more likely to occur in the case of industries producing tradable products than those producing non-tradables.

But the UNCTAD warns that these positive effects of 'brain circulation' are not likely to occur in LDCs, for clear reasons:

Many of those positive effects, however, occur only once countries have reached a certain level of development and income growth. That implies the existence of considerably improved economic conditions in home countries, which provide incentives for temporary or permanent return of emigrants and for the establishment of stronger knowledge and economic flows. Moreover, an improved domestic environment entails lower out-migration pressure. That situation is obviously not the one prevailing in LDCs. Those countries are therefore the most likely to suffer from brain drain, rather than benefiting from brain circulation, brain gain or the other positive effects possibly associated with emigration.

For the LCDs, three main features of skilled emigration have been observed since the 1990s:

• Emigration rates were generally high among tertiary-educated persons by international standards, with an unweighted mean for LDCs of 21 per cent in 2000 (much higher than for all all lower-middle-income and low-income countries)
• There was considerable variation in the total rates of emigration among tertiary–educated persons by and within country groups among the LDCs. They were close to 25 per cent (unweighted) in the island LDCs, West Africa and East Africa, and lowest in the generally more populated Asian LDCs (6 per cent), with Central Africa falling in between (14 per cent).
• Out-migration among tertiary-educated persons from LDCs to OECD countries has accelerated over the last 15 years. The unweighted mean emigration rate rose from 16 per cent in 1990 to 21 per cent 10 years later. That intensification of emigration among skilled persons was much stronger than among all emigrants from LDCs.

The top-educated persons (with more than basic tertiary training) emigrate in far greater numbers than for the tertiary-educated population as a whole. It is estimated that as many as 30–50 per cent of the developing world’s population trained in science and technology (including those from LDCs) live in the developed world. This has a direct impact on those countries’ skills base, their absorptive capacity and their technological catch-up possibilities.

The UNCTAD formulates policy recommendations on how best to deal with these migration flows, in such a way that they limit the impact on the knowledge-base of the LDCs.


5. 'Knowledge aid'
The classic saying goes that it's better to teach a man how to fish, than to throw him a fish whenever he's hungry. Likewise, the justification for foreign aid is often articulated only on the basis of pressing economic, social and political objectives (e.g. food aid, with less attention for teaching people how to grow more food).

So more fundamentally, aid can help to build up the knowledge resources and knowledge systems of LDCs. This is particularly important for the LDCs because their level of technological development is so low and technological learning through international market linkages is currently weak.

Aid can play an important role in developing a minimum threshold level of competences and learning capacities which will enable LDCs to rectify that situation. Indeed, the provision of more knowledge aid, if directed towards the right areas and appropriate modalities, may be the key to aid effectiveness.

The UNCTAD defines 'knowledge aid' as aid that supports knowledge accumulation within partner countries.

Knowledge aid can be provided in two ways:

• either through supplier executed services, where, for example, donors provide consultants who advise on, or design and develop, projects, programmes and strategies
• or through strengthening the knowledge resources and knowledge systems of the partners themselves, a process which may be called 'partner learning'

In either case, those activities might be designed to increase knowledge resources for institutional, regulatory and policy development, or to support the development of productive capacities through technological learning.


Aid to build STI capacities
Aid to build science, technology and innovation capacity is a particular form of knowledge aid and should support:

• the development of productive capacities through building up domestic knowledge resources and domestic knowledge systems
• the development of governmental capacities to design and implement STI policies

The report estimates that such aid to STI has been a low priority amongst donors, when it comes to funding efforts in LDCs: reported aid disbursements for research and the development of advanced and/or specific human skills (including agricultural education and extension), constituted only 3 per cent of total aid disbursements during the period 2003–2005, with 90 per cent allocated to building human skills, particularly higher education.

A brief overview of the numbers for 2003-2005 for all LDCs combined show that knowledge aid has captured a marginal share of the overall aid budgets:

• aid for agricultural research equal to only $22 million per year
• only $62 million for vocational training
• a meagre $12 million per year for agricultural education and training
• $9 million per year for agricultural extension
• development of advanced technical and managerial skills received only $18 million per year
  
• disbursements for what is described in the reporting system as “technological research anddevelopment” – which covers industrial standards, quality management, metrology, testing, accreditation and certification – received only $5 million per year during 2003–2005.

Clearly, STI has not been a priority for donors. But most startlingly, for the one STI area that is
emphasized in the routine poverty alleviation programmes, namely agricultural research and extension, aid commitments to LDCs have actually fallen rather than risen since the late 1990s. Compare this with the annual technical cooperation commitments to improve 'governance' (in the widest sense). In 2003–2005 these were $1.3 billion. Agricultural extension received $12 million...

As the UNCTAD report simply notes: it will be impossible to ensure 'good governance' if States don't have a productive and viable economy to build on and to draw incomes from.

The authors make some policy recommendations that could help deal with the problem of the lack of aid going to knowledge, technology and science. The recommendations are offered per sector:

Agricultural R&D
Although agriculture is the major livelihood in the LDCs, the current agricultural research intensity – expenditure on agricultural research as a share of agricultural GDP – is only 0.47 per cent. That compares with 1.7 per cent in other developing countries. The LDC agricultural research intensity is far below the 1.5 to 2 per cent recommended by some international agencies. Moreover, the low level reflects a serious decline in the agricultural research intensity in the LDCs since the late 1980s, when the figure stood at 1.2 per cent.

Non-agricultural technological learning and innovation
Agriculture is still the major source of employment and livelihood in the LDCs, but the employment transition which they are undergoing means that this position is not tenable if development partners wish to reduce poverty sustainably and substantially.

One important recommendation for the non-agricultural sector is that donor-supported physical infrastructure projects should all include components use the construction process to develop domestic design and engineering capabilities.

In addition, there is a need for public support for enterprise-based technological learning, which should be in the form of grants or soft loans for investment in the relevant types of knowledge assets. Such support should be undertaken as a costsharing public–private partnership for creating public goods, particularly in relation to the development of design and engineering skill through enterprise-based practice. These STI capacity-building activities could be particularly useful if they are linked to value chain development schemes, FDI linkage development and the facilitation of South–South cooperation.

“Aid for Trade”
There is widespread support for scaling up this kind of aid amongst LDCs. Experiences show that technological learning and innovation are central to successful cases of trade development. However, technological learning and innovation have been conspicuously absent from past efforts to provide Aid for Trade. They are neglected within current attempts to define the scope of the subject.

It is recommended that aid for technological learning and innovation for tradable sectors be a key component of Aid for Trade, and LDC development partners should adopt best practices which are evident from successful cases of trade development, such as palm oil in Malaysia and Nile perch in Uganda. Note that environmentalists have condemned precisely these two examples as cases of how trade development can destroy the most basic foundations of sustainability.


Conclusion
By way of conclusion, we can say that many insights and recommendations from the UNCTAD report can be readily applied to the development of strategies with which LDCs can approach the opportunities of the emerging bio-economy. Such an new, green economy holds the potential to boost local development and allows poor countries to leapfrog beyond the fossil fuel era. But in order to transit towards this sustainable, biobased economy, investments in knowledge and technology are urgently needed. The sector is highly competitive, and mere comparative advantages (agro-ecological resources) won't suffice for these countries to participate in it in a meaningful way.

Biopact readers know that we have often stressed the need for appropriate tech transfer strategies in the biofuels sector. Brazil has gone some way in this respect, and has forged South-South collaboration efforts by linking its own expert agricultural research organisations with those of poor countries. There's also France's bioenergy knowledge-exchange initiative, which couples students from the country to collegues in developing countries. But overall, these initiatives remain marginal. A much more urgent and broader effort is needed to create robust ways for the North to help the South strengthen its capacities to boost investments in STI.

For example, policies in LDCs must ensure that when foreign companies from highly developed countries enter the sector in poor countries, technology and knowledge transfers as well as opportunities for joint-ventures occur that allow local players to acquire expertise and technological capabilities. Else, biofuels may become just another 'resource grab'.

On the other hand, States need to craft policies and infrastructures that make it possible for local players to 'absorb' knowledge (it's a two-way process). Finally, as we have stressed earlier, national and international policy frameworks and investments in STI in developing countries are crucial for the bioenergy sector to flourish in a genuinely sustainable way.

Professor John Mathews, an expert on STI and knowledge-driven industrial development strategies has writen in-depth analyses on the subject as it relates to the biofuels sector in developing countries (for an example, see 'A Biofuels Manifesto').

On an ending note, consider this. Those of us who understand the complex and multi-dimensional concept of 'sustainable development' will admit that such an understanding requires study, exchanges between thinkers, scientists and policy makers. Don't we all want the people in the South - who are often merely the passive subjects of such concepts - to acquire the capacities needed to develop their own notions of sustainability and the skills to implement them?

References:
UNCTAD: The Least Developed Countries Report, 2007. Knowledge, technical learning and innovation for development [*.pdf, full report] - July 2007.

UNCTAD: The Least Developed Countries Report, 2007 [*.pdf, summary] - July 19, 2007.

UNCTAD: The Least Developed Countries Report, 2007, Highlights - July 19, 2007.

John Mathews, A Biofuels Manifesto: Why Biofuels Industry Creation Should be 'Priority Number One' for the World Bank and for Developing Countries [*.pdf] - September 2006.

Article continues

ScottishPower announces UK's largest energy crop plan

ScottishPower announced it is looking to contract Scottish farmers to produce 250,000 tonnes of energy crops to be burned at Scotland’s two coal fired power stations, Cockenzie and Longannet. The energy crop will displace coal burned in the stations.

Energy crops provide carbon neutral fuel as the CO2 that is released when the crop is burned is equal to the CO2 that is captured as the plant is grown. ScottishPower already burn carbon neutral biomass such as wood at the coal fired power stations as part of their renewable programme.

The project will use about 12% of Scotland’s total agricultural land – roughly 35,000 hectares - with 5 % of the company’s coal requirement displaced by energy crops by 2013.

The energy crops will be a mix of crop types including cereal crops and short rotation coppice (SRC) such as willow. ScottishPower, part of the Iberdrola group, plans to maximize the use of set aside land, and minimize the effect on land used for food crops.

SRC consists of densely planted, high-yielding varieties of either willow or poplar, harvested on a 2 to 5 year cycle, although commonly every 3 years. SRC is a woody, perennial crop, the rootstock or stools remaining in the ground after harvest with new shoots emerging the following spring.

A plantation could be viable for up to 30 years before re-planting becomes necessary, although this depends on the productivity of the stools. In the UK, yields achievable from willow SRC at first harvest are expected to be in the range 7 to 12 oven dry tonnes per hectare per year depending on site and efficiency of establishment. New varieties are expected to greatly increase yields:
energy :: sustainability :: climate change :: coal :: co-firing :: biomass :: bioenergy :: short rotation coppice :: energy crops :: Scotland ::

ScottishPower is already the UK’s largest generator and developer and operator of on-shore wind energy and this is the latest strategic initiative toward reduced carbon emissions.

Frank Mitchell, ScottishPower’s Generation Director, said: “This is a significant step in our renewable energy programme ultimately displacing 300,000 tonnes of carbon emissions per year. However, it is also an excellent opportunity for farmers with ScottishPower offering support for the Scottish agricultural community”.

In the UK, support for renewables is provided through the Renewables Obligation (RO) that requires suppliers to source 10% of their electricity from renewable sources by 2010, rising to 15.4% by 2015.

The UK Government announced new support for biomass in March 2006 under the revised Climate Change Programme and in May of the same year the Scottish Executive pledged funding of £20 million for biomass, marine, hydrogen and fuel cell projects and microrenewables.

More recently, the UK's Department for Environment, Food and Rural Affairs, the Department of Trade and Industry and the Department of Transport released their joint Biomass Strategy for the UK, which shows considerable potential for locally produced biofuels. However, it also considers imports (earlier post).

Picture: short rotation willow coppice. Credit: Defra Energy Crops.

References:
ScottishPower: ScottishPower Announces UK's Largest Energy Crop Plan - July 19, 2007.

U.K.'s Forestry Research service: Information about short rotatio