Nigeria's Imo State launches large palm oil programme to shake off oil curse

Writing in This Day (Lagos), Eugene Agha describes how Nigeria's Imo State is rediscovering palm oil. The petroleum boom in the country has not benefited the people at large, which is why more and more regional governments are looking at agriculture as a way to shrug off the crude oil curse and to reinvest in land and people. Imo State has begun implementing the Imo State Oil Palm Development Programme (ISODEP) which targets to establish four million high yielding tenera palm trees by the year 2011. Distribution of the fast growing, early maturing trees amongst farmers has already begun. In Nigeria, petroleum is big business controlled by a select group of foreign companies, corrupt officials and local elites. The question is: will the new palm oil era be any different? Agha thinks it will.

Agriculture is the traditional occupation of the Nigerian people, he writes. Prior to the discovery and consequent exploration of mineral oil in the country, the economy of the nation stood on the tripod of palm oil, cocoa and groundnut production. These cash crops were produced not just for subsistence but also for export. While the south east region produced palm oil, the south west was into cocoa production and the north was well known for its groundnut pyramids. Each of the regions was doing well in its area of strength and the country was already on its way to economic independence.

Once the largest producer in the world, Nigeria's palm oil sector has declined and stagnated for decades. Large, old plantations are now ready for replanting.

The palm oil from the eastern region was described as being of the highest quality and the people took pride in the work of their hands. The people were so good at it that the Malaysians like the three wise oriental kings followed the scent of the palm oil to Imo state to learn the fine art of palm oil production. However, with the crude mineral oil boom, laziness and indolence took the place of hard work and dignity of labour. Agriculture suffered a setback as it was relegated to the back burner. In fact, agriculture became the occupation of the never-do-wells, the old and uneducated poor in the society.

The young people preferred to look for white collar jobs instead of engaging in farm work. The government on its part was more concerned with the wealth coming in from crude mineral oil to bother about providing incentives to encourage agriculture. Being ignorant of the great potentials of palm oil, the people threw away their chance of earning an enviable place in the great economies of the world. Currently, Malaysia which came here to learn about palm oil production is the world's number one producer and exporter of crude palm oil, closely followed by Indonesia. Having discovered the unparalleled productivity and huge benefits of investing in palm oil production, reports indicate that currently almost half of Malaysia's cultivated land consists of oil palm.

In 2004, according to reports, Indonesia cultivated oil palm plantations which covered 5.3 hectares of land. These plantations generated 11.4 million metric tons of palm oil with an export value of US$ 4.43 billion and brought in $42.4 million to the Indonesian treasury. Of course since then, the value of the product has continued to climb, making it almost competitive to petroleum.

Now the basic questions are; why has palm oil become the world's number one fruit crop? Why the sudden surge in the demand for palm oil? How did something Nigerians, nay Igbo threw aside become so valued in the world market? Well, apart from being a major ingredient for food, palm oil has other myriad uses. It is used in cosmetics production and more importantly one of the raw materials in biodiesel production. According to experts, biodiesels are biodegradable and, when burned, have fewer emissions than petroleum-based fuels. Thus, biodiesels are being looked upon as possible alternative energy source:
energy :: sustainability :: biomass :: bioenergy :: biofuels :: palm oil :: agriculture :: poverty alleviation :: petroleum :: South-South :: China :: Imo :: Nigeria ::

Because of this development, environmentalists have been supportive of biofuels and other world bodies have voted for the idea of reducing dependence on Middle East oil since many biodiesel crops can be grown in friendly territories. With this in mind, policymakers from Asia and Europe have shown interest and have made a major push to promote and adopt biofuels. These developments have all contributed to increased investment in palm oil production.

To cash in on this, Indonesia has reportedly announced that it intends to double its oil palm crude production by 2025. Under a 2005 investment proposal, prepared by the State Plantation Corporation PT Perkenuan Nusantara (PTPN), Indonesia would develop about 1.8 million hectares of land for palm plantation. China would be involved in the plan, reportedly investing $7.5 billion in energy and infrastructure projects, including providing capital for palm oil plantations. The project is expected to employ nearly 400,000 people and generate an annual inflow of $45 million in tax revenue to the state.

Despite these, oil palm is not native to Asia. It is native to Igboland but what have we gained from it? In one word, nothing. Not because the palm tree has refused to yield its precious oil to us but because we have neglected a veritable source of revenue in our pursuit of the easy money. Our over dependence on mineral oil has not done even half of what palm oil has done for Malaysia and Indonesia. The country has continued to tether on the brink of collapse as the Niger Deltans battle the rest of the country for the control of oil exploration rights. Today, if they sneeze the whole country catches cold.

Development programme
Knowing the dangers inherent in depending on the crude mineral oil, and having become aware of the great potentials and investment opportunities of palm oil, the knowledgeable in the land are poised to reverse the trends in agriculture. The government of Chief Ikedi Ohakim of Imo state is one of those who have decided to take a plunge in what comes natural to our land - investment in palm oil production. In the draft presentation of the Imo State Oil Palm Development Programme (ISODEP), the government declared that it is set to claim for the state the number one position in oil palm production in the country.

The vision of ISODEP is to create an alternative economic revenue base and lay a solid foundation for agric-business in Imo state as part of the millennium development goals critical objectives. The programme also seeks to reawaken the consciousness of Imo people to the nativity of palm tree and use the palm tree as a start-up tool for the clean and green initiative of the state government.

Under the programme, the state government seeks to raise and distribute four million tenera oil palm for planting through small holder's management unit in every community in the state within a four-year period. The government is also set to produce palm oil cluster centres and establish semi-automated oil mills in each nucleus in the 27 local government areas in the state. Ultimately however, Ohakim's government sees in the programme an avenue to significantly reduce poverty, enhance rural community development and create employment opportunities for the citizens. The government is also hopeful that this foundation project if handled well would attract foreign investment into the state's agriculture sector.

Announcement of the ISODEP by Longer S. Anyanwu, Imo State Ministry of Agriculture

You know that when we were small children, we were taught at school that palm tree is a native of Imo land through the visionary leadership of Dr M..I. Okpara but today after 48 years of existence of most of these trees, the yielding ability and the potentiality of these trees have now reduced to 75%. Malaysia we were told came here to collect palm fruit, today they are number one. So my policy thrust here is to ensure that at the end of 2011, this ministry would have carefully implemented a policy called ISODEP (Imo State Oil Palm Development Programme) which targets to achieve four million palm trees by the year 2011.

Commencing from 2008, I’m collaborating with the Malaysians and NIFOR [Nigerian Institute for Oil Palm Research] to get a high-breed specie of palm fruits called Tenera which is the fastest yielding, most productive palm tree in the world today of which the species from Malaysia has been proven to start yielding at the age of one year, six months. And Nigeria has produced one at NIFOR, that starts yielding in two and half years. So we are going to have the combination of the two so that by the year 2011, we can hit our chest and look back and said that we are proud to be the leader in this area.

And today, my governor told me that some experts in China and Malaysia who contacted us said that even the fallen trees that are no longer economically viable should not be thrown away, because we can recycle them to produce plywood. This is the blueprint that was presented to the governor, and it made his day.

This is the vision, the mission, the goals, I have mapped out and I have given myself target, week by week. Every day I come to this office, I ask myself what I have done on my ISODEP. We’re collaborating with the UNDP, NDDC, and other oil companies to realise this big project of ensuring the reclamation of four million palms tress. Do you know the beauty of it? I’m going to use the communities and the local government.

And by the time we charge every local governments every community to plant a minimum of fifty thousand palm seedlings, there is going to be a competition. And then this ministry is going to build semi-automated oil mills in those areas that will be managed by private entrepreneurs through special skills, low scheme arrangement. And I will tell you that by the time we finish the implementation of this programme, Imo State will be another self sustaining state in this country.

I want to also tell you that we are encouraging the youths to embrace agriculture and farming because the attitude people have toward agriculture is wrong, that it’s a job for jobless or for the aged. I’m now using young people at school. At the end of every academic session, the graduating students from secondary school, that are SSS 3 students born of Imo state, will emerge a stake holder by a token of a presentation of a palm tree by the government.

The principals of their respective schools will give them the palm tress to give to their parents and that automatically qualifies the student to be a stake holder in the state. The whole idea is that in three years the tree would have matured and began to germinate forth seeds, thereafter the student may wish to ask the government for another token. If this exercise is taken seriously by that child in future he may end up paying part of his/her school fees from the proceeds of the tree. And it’s the only way we can refocus the youth towards developing agriculture in lmo state.

Despite these laudable objectives however, the programme would not be a piece of cake to implement, especially knowing the disdain the young people in the state have for farming. Also, ignorance concerning the marketability of palm oil will have to be erased from the minds of the citizens before any major breakthrough could be made for without the full participation of the people the project will not have the effect government is projecting. Also, how prepared is government to establish the oil mills to ease the burden and hard work associated with palm oil production seeing that it was a main reason for the quick abandonment of the business at the first sign of an alternative way of making a living?

Commenting on the development, the state's commissioner for agriculture and natural resources, Chief Longers Anyanwu said government is willing to do all it takes to ensure the success of the programme. He said plans for the establishment of the mills had already reached advanced stage.

He disclosed that the state government plans to encourage youth participation by using secondary school students to distribute the palm seedlings. And to express its desire to see that the programme succeeds, the commissioner said all the executive members of Ohakim's government have been mandated to plant about 1000 palm seedlings as their contribution and as a sign of government's commitment to the revitalisation of oil palm production in the state.

The commissioner said it was also in government's plan to replace all the old and wild palm trees in the state with the improved species of tenera to ensure high production of palm oil for export purposes. In this regard, the association of oil palm producers in the state have declared their readiness to partner with government in its march to inject life into the business of palm oil production. Speaking on the renewed interest of government in palm oil production,Bernard Emecheta said government's plan is a welcome development and expressed confidence that they are capable of seeing it through.

He said palm oil production declined because of continued government neglect and the inability of the local producers to get any form of incentive from the government. He expressed regret over the fate of the state-owned Adapalm; an oil palm plantation company which he said has been in steady decline through poor management and government neglect. 'If a big company like Adapalm which used to record huge revenue for the state government could be allowed to waste away like that what do private palm oil producers have in government being interested in our affairs?' He remarked that with this renewed interest by government in palm oil production, the state has a good chance of at least increasing its internally generated revenue as well as curb the raging unemployment among the youth.

Already the state is collaborating with the Nigerian Agip company to realise this revolution. At a meeting held recently at the company's headquarters in Port Harcourt, the oil giants asked the state ministry of agriculture and natural resources to design a plan of action for that purpose. The company has in principle approved the erection of an administrative block and nursery sheds to support government in its bid to revitalise the oil palm sector. In this connection, Chief Anyanwu has already swung into action by providing a plot of land for the immediate take off of the projects. Discussions are also underway with Shell Petroleum Development Company for purposes of assisting government achieve its dream in this same direction.

Hopefully the 'new face of Imo' as the Ohakim government delights to be called will not go the way of previous governments in the state who only pay lip service to developmental issues. Palm oil production as other countries have discovered is big business, big enough to save this country from the heart ache of incessant unrest in the Niger Delta. All it requires really is leadership that is capable of trusting in its ability to bring about positive change. It's all about reorientation of the mind of the local populace that palm oil business is as good as mineral oil bunkering but without the hazards associated with the later.

References:
Vanguard: 4 million trees coming to restore Nigeria’s oil palm glory — ANYANWU [*.pdf] - October 7, 2007.

This Day (Lagos) (via AllAfrica): Palm Oil Production As Linchpin to Imo Agric Revolution - December 3, 2007.

The Nigerian Institute for Oil Palm Research.

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Synthetic biology company OPX Biotech secures $3.6 million in funding for next generation biofuels technology

OPX Biotechnologies, Inc., a new company dedicated to enabling economically viable biofuels and biorefined chemicals through synthetic biology research announces that it has secured $3.6 million in venture funding led by Mohr Davidow Ventures (MDV), a leading Silicon Valley-based venture capital firm.

OPX has developed a first-of-its-kind genomics technology platform known as SCALEs (SCalar Analysis of Library Enrichments) that enables massively parallel full genome search, identification of specific causative genes, and rapid genetic modification and testing. The platform allows OPX to identify the role of each gene and how to modify it to achieve the characteristics needed for specific fuel and chemical products 1000 to 5000 times faster than conventional methods. The result is to quickly engineer new microbes to provide major improvements in tolerance, productivity, and specificity for fuel and chemicals production using biological processes. This might vastly decrease the production costs and capital requirements for renewal fuels and chemicals. SCALEs is based on pioneering genomics work by Professor Ryan Gill and Dr. Michael Lynch at the University of Colorado.

OPX has the potential to address one of the great challenges of our time - meeting the tremendous demand for renewable fuels and chemicals that are cost competitive and superior to petroleum-based products with far lower carbon emissions. Their proprietary, first of its kind massively parallel, full genome search and gene modification technology platform is a major breakthrough in synthetic biology that could vastly reduce the time it takes to design the microbes needed for economically viable biofuels and biorefined chemicals. - Erik Straser, MDV general partner

Synthetic biology is a rapidly emerging, disruptive science field with great promise for the production of abundant biofuels and renewable, innovative bioproducts (previous post). It is based on collecting and sequencing large amounts of genetic material from the environment (from microorganisms in oceans, soils, etc), analyzing and matching the most interesting sequences to recombine and reorganize them so that they are programmed to carry out a specific bioconversion process; the synthetically engineered 'building blocks' are then inserted into (micro)organisms or used as such as artificial 'biological machines', which perform the desired task (schematic, click to enlarge).

Besides Mohr Davidow Ventures, a major Silicon Valley venture firm and one of the top investors in the clean technology field, X/Seed Capital, a leading seed stage venture firm, invested in OPX earlier and participated again in this second round:
energy :: sustainability :: biomass :: bioenergy :: biofuels :: bioproducts :: synthetic biology :: genomics :: biotechnology :: bioeconomy ::

OPX received seed financing from X/Seed in June, 2007.

The company further announced that it appointed Rob Chess Chairman and CEO. Chess serves on the Board of Directors of the Biotechnology Industry Organization (BIO). He received his B.S. degree in Engineering from the California Institute of Technology and an M.B.A. from Harvard. Chess has held leading positions in Nektar Therapeutics, a company that develops improved pharmaceutical products using its innovative drug delivery platforms, and was co-founder and President of Penederm, Inc., a publicly-traded dermatological pharmaceutical company that was sold to Mylan Laboratories. He has held management positions at Intel Corporation and Metaphor Computer Systems (now part of IBM), and was a member of the first President Bush's White House staff.

The OPX Board of Directors includes MDV's Erik Straser, X/Seed's Michael Borrus, Professor Ryan Gill, a co-founder of the company and the Patten Assistant Professor of Chemical Engineering at University of Colorado, and Rob Chess as Chairman and CEO.

Mohr Davidow Ventures is a leading Silicon Valley-based venture capital firm that for 25 years has identified, mentored and developed entrepreneurs and young companies redefining business, technology and medicine. MDV has $2 billion dollars under management.

X/Seed Capital is an early-stage venture firm that provides seed capital for breakthrough innovators. X/Seed was founded in 2006 and is based in Silicon Valley.

Schematic: from DNA collection to reprogrammed microorganism. Credit: Synthetic genomics.

References:
Michael D Lynch, Tanya Warnecke & Ryan T Gill. “SCALEs: multiscale analysis of library enrichment”, Nature Methods - 4, 87 - 93 (2007), doi:10.1038/nmeth946

Ryan T. Gill, Tanya Warnecke, Michael D. Lynch, Amarjeet Singh, "Using Genomics to Direct Strain Selections", AIChE 2007 Annual Meeting, Biomolecular Engineering.

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Scientists warn forest carbon payment schemes could increase poverty

A new study by one of the world's leading forestry research institutes warns that the new push to 'reduce emissions from deforestation and degradation', known by the acronym REDD, is imperiled by a routine failure to grasp the root causes of deforestation. The study sought to link what is known about the underlying causes of the loss of 13 million hectares of forest each year to the promise and potential pitfalls of REDD schemes. Without a major overhaul of policies dealing with land and forest property rights, such schemes could intensify poverty, the scientists warn.

Based on more than a decade of in-depth research on the forces driving deforestation worldwide, the report [*.pdf] by researchers at the Center for International Forestry Research (CIFOR) found that there is ample opportunity to reduce carbon emissions if financial incentives will be sufficient enough to flip political and economic realities that cause deforestation. The report was released today at the United Nations Conference of the Parties (COP-13) in Bali, where environment ministers from 190 countries are meeting to plot a long-term strategy for combating global warming. High on the agenda is reducing the 1.6 billion tons of carbon emissions caused each year by deforestation, which amounts to one-fifth of global carbon emissions and more than the combined total contributed by the world�s energy-intensive transport sectors.

After being left out of the Kyoto agreement, it's promising that deforestation is commanding center-stage at the Bali climate talks. But the danger is that policy-makers will fail to appreciate that forest destruction is caused by an incredibly wide variety of political, economic, and other factors that originate outside the forestry sector, and require different solutions. - Frances Seymour, CIFOR Director General

In other words, stopping deforestation in Indonesia caused by overcapacity in the wood processing industry is a completely different challenge from dealing with deforestation stemming from a road project in the Amazon or forest degradation caused by charcoal production in sub-Saharan Africa.

According to CIFOR, careful examination reveals that complex, indirect forces are often more important than the logging and slash and burn activities popularly understood as the main causes of deforestation. Forces such as fluctuations in international commodity prices; agricultural and, more recently, biofuel subsidies; roads and other infrastructure projects can encourage forest clearing; finally, high energy prices can drive forest destruction as communities seek to rely more on biomass. Moreover, deeply ingrained and routinely corrupt government practices often favor large corporate interests over community rights to forest resources.

Seymour said the CIFOR analysis, which draws on a range of studies of the economic, social and political conditions affecting the world's most vulnerable forests, seeks to ensure that any initiatives to stem deforestation that might emerge in future climate change agreements are firmly grounded in reality:
energy :: sustainability :: biomass :: bioenergy :: greenhouse gas emissions :: climate change :: deforestation :: avoided deforestation :: compensated reduction :: REDD :: carbon credits :: poverty :: land property rights :: governance ::COP-13 ::

Most importantly, CIFOR advises decision makers to learn from the past and look beyond the confines of the forestry sector to the array of market failures and governance failures that spark a chain of events culminating in deforestation.

For example, according to the study, Indonesia, which is estimated to lose 1.9 million hectares of forest each year, has emerged as one of the world's leading sources of carbon emissions in part due to a global spike in prices for palm oil and a surge in China's demand for wood pulp. Together, these forces have pushed deforestation into carbon-rich peatlands that are being cleared and drained to make way for oil palm and pulpwood plantations. Limiting deforestation in Indonesia�s peatlands should be a high priority because the carbon losses per hectare are substantial.

Meanwhile, CIFOR notes that in South America, the loss of 4.3 million hectares a year is driven in part by meat consumption that encourages conversion of forests to pasture lands throughout the region. In Ecuador, road building has been a major cause of deforestation. In sub-Saharan Africa, fuelwood extraction and charcoal production are factors behind the continent's loss of 4 million hectares a year.

Policies that seek to halt deforestation will need to be crafted to address diverse local situations and target activities in areas such as agriculture, transportation and finance that lie well beyond the boundaries of the forest sector. - Markku Kanninen, author

The perverse subsidies that provide incentives for clearing forest must be removed and efforts to secure property rights for local forest communities should be encouraged, Kanninen said.

The report also sees promise in the increasingly popular notion that deforestation can be addressed with financial incentives that compensate landowners for 'environmental services'. Seymour said discussions in Bali to fight deforestation by compensating forest stewards for protecting the carbon-storage capacity of forests through what is now a multi-billion dollar global market for carbon credit are potentially powerful.

Poverty warning
Such payments to individual land-users have the potential to 'flip' financial incentives from favoring forest destruction, as they now do, to favoring conservation, Seymour said. But the key question is whether or not REDD incentives will be sufficient to flip political and economic decisions at the national level that drive deforestation.

Appealing as they are, Seymour said it's critical to understand that, due to decades of inattention to the rights of forest dwellers, new payment streams tied to conservation could intensify the severe poverty that now afflicts the majority of rural forest communities in the developing world.

Since forest property rights are often very unclear, payment for carbon services could end up providing incentives for corrupt officials or local elites to appropriate this new forest value from local communities. We've seen this happen before in similar situations, and there�s every reason to believe, given the kind of money now being paid for carbon credits, that it could happen again. - Frances Seymour

Seymour said such problems can be avoided if policy makers enter the process of designing REDD strategies with a clear understanding of potential pitfalls and what can be done to avoid them. The report advises that reducing carbon emissions from forests will require strengthening the weak governance mechanisms that have long proven unable to enforce many existing prohibitions on forest clearing.

Finally, the report calls for ensuring that the REDD process is fair to poor forest communities. According to Seymour, there is a need to temper the desire for maximum reduction in forest-based carbon emissions with regard for the legitimate rights of forest communities to realize the income potential of their forestlands.

At times there will be trade-offs between reducing carbon emissions and reducing poverty, she adds.

Biofuels to the rescue?
Biopact agrees that, in theory, REDD schemes could offer forest communities and poor farmers an opportunity to benefit from carbon credits. But the schemes also entail the major risk of 'forest carbon grabs' and could increase poverty when forest communities are chased off their land or farmers out of their livelihoods by those who control and seek to profit from REDD. When farmers and communities convert forest into land to grow crops or for the production of energy (fuel wood, charcoal), they are guaranteed an income, because they are the suppliers of the products for which there is a demand. Income is generated and controlled from the bottom up. REDD schemes on the contrary are based on 'trickle down' payments and require a highly efficient bureaucracy, strong monitoring capacities, good governance and a whole set of guarantees to ensure that the money arrives at the communities whose forests are taken up in the scheme.

Moreover, a perspective that often lacks from discussions about avoided deforestation or compensated reduction schemes is the threat of increasing energy prices and the appeal of biomass. If energy prices continue to increase at the pace we have seen over the past years, biofuels and energy crops grown on forest land could potentially generate more profits than carbon credits.

In this context, a case could be made in favor of promoting the mass-production of biofuels on non-forest land, because this is one of the most direct and feasible ways to stop oil prices from increasing further (previous post). The explicitly sustainable bioenergy potential found in non-forest zones is large enough to curb the trend. The potential for biofuels without deforestation is estimated to be around 1100 to 1400 Exajoules (max) by 2050 - that is around 7 times as much oil as is currently being consumed worldwide (earlier post, here and here). This potential takes into account all food, fiber, fodder and forest product needs of growing populations. In short, tapping this enormous resource base could help limit the increase in oil and energy prices, and thus partly limit the appeal of growing energy crops on forest land. The problem remains, though, that crops thriving in rainforest climes, like palm oil, are so efficient and profitable. Developing energy crops on non-forest land could be more costly.

Biopact has called repeatedly on conservationists and environmentalists to study the root causes of deforestation more in depth, and in particular to analyse the new interplay between the potential for biofuels as it is related to energy prices, and deforestation. The CIFOR report offers a first step in that direction, but more focused research is urgently needed.

Headquartered in Indonesia and with offices in Latin America and Africa, the Center for International Forestry Research (CIFOR) is a leading international forestry research organization established in response to global concerns about the social, environmental, and economic consequences of forest loss and degradation. CIFOR is one of 15 research centers within the Consultative Group on International Agricultural Research (CGIAR).

Image: Borneo, Indonesia - forest being cleared to grow palm oil, a very lucrative crop. Credit: CIFOR.

References:
CIFOR: Do Trees Grow on Money? The implications of deforestation research for policies to promote REDD [*.pdf] - December 7, 2007.

CIFOR: New Report Warns Failure to Understand Root Causes of Deforestation Imperils New Efforts to Curb Forest-Based Carbon Emissions - December 7, 2007.

Biopact: Harvard Center for International Development: "Biofuels can match oil production" - November 06, 2007

Biopact: IEA study: large potential for biomass trade, under different scenarios - May 13, 2007

Biopact: A look at Africa's biofuels potential - July 30, 2006

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India to add 1700MW of biomass co-generation by 2012; 18,000MW potential from agro-residues

Under its 11th Plan period (2007-2012), the government of India aims to add 1,700 MW capacity through biomass and bagasse cogeneration in various states, including Maharashtra, Uttar Pradesh, Tamil Nadu and Karnataka, the Lok Sabha (Lower House) was informed today.

The target consists of 500 MW from biomass projects and 1,200 MW from projects based on utilizing bagasse (the fibrous pulp byproduct of sugarcane processing) as a source of bioenergy, Minister of State for New and Renewable Energy Vilas Muttemwar announced in a written statement.

As per the National Biomass Resource Atlas prepared by the Indian Institute of Science, Bangalore, under a project sponsored by the Ministry, a cumulative biomass power potential of about 18,000 MWe from surplus agro-residues has been estimated in the country.

The total technical biomass potential from residues and energy crops in India is estimated to be around 66,880MW (table, click to enlarge). In order to turn this potential efficiently into energy, an inter-ministerial initiative was recently launched: the production of a detailed atlas to accurately asses the nation-wide biomass resource base, including agricultural residues suitable for conversion into energy, which must allow the planning of the most optimal use of the resource (previous post).

Under the new bioenergy plan, the states of Andhra Pradesh, Assam, Bihar, Chhattisgarh, Gujarat, Haryana, Himachal Pradesh, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Orissa, Punjab, Rajasthan, Tamil Nadu, Uttar Pradesh and West Bengal have been estimated to have a potential to set up biomass based power projects of 100 MW or above.

Sugar mills with a crushing capacity of 2,500 tons per day in Maharashtra, Uttar Pradesh, Tamil Nadu, Karnataka, Andhra Pradesh, Bihar, Gujarat, Punjab and Haryana have an estimated potential of about 5,000 MW surplus power generation through optimum bagasse-based co-generation. India is the world's second largest sugarcane producer, and the sector represents the country's second largest agro-industrial segment. Sugar production was estimated to top a record 28 million tonnes this year, resulting in a vast stream of bagasse from the 322 million tonnes of stalks harvested (previous post).

The government is providing incentives for setting up of power generation projects based on biomass and bagasse cogeneration in the form of capital subsidy and fiscal incentives such as accelerated depreciation, relief from taxes and duties, term loans from Indian Renewable Energy Development Agency (IREDA):
energy :: sustainability :: biomass :: bioenergy :: biofuels :: bagasse :: residues :: co-generation :: CHP :: CCHP :: India ::

This apart, policies have been introduced in potential states for wheeling, banking and buy-back of electricity generated from commercial biomass power and bagasse cogeneration projects.

In reply to another query, Muttemwar said an expert committee constituted by the Planning Commission has prepared an Integrated Energy Policy Report covering all sources of energy, including renewable energy sources.

This report has highlighted the need to maximally develop domestic supply options and diversify energy sources. It has also projected that renewables may account for 5-6 per cent of India's energy mix by 2031-32, the minister said.

References:
Press Bureau of India: Addition of 1700MW Biomass Cogeneration Power by 2012 - December 7, 2007.

Earthtimes: Agro-residues can yield 18,000-MW power: minister - December 7, 2007.

Biopact: India prepares 'Biomass Atlas' to map and tap bioenergy potential - November 26, 2007

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Biofuels: Africa's new oil?

SciDev is running an interesting series on the potential benefits and risks of the biofuels revolution. In several opinion pieces, doomers, realists and utopians have their say. The essays are accompanied by a nuanced editorial that outlines some of the complexities of the emerging sector. The following feature was written by Kimani Chege and looks at the potential of (first generation) biofuels in Africa. The green fuels hold great promise for the continent, but local research isn't yet in place to reap the rewards or analyse the pitfalls, he suggests.

It is only ten o'clock in the morning and Kenyan taxi-van driver Richard Kamiri is already tired. Throughout the morning he has had to explain to his passengers the reason he has repeatedly hiked the fare. In just a week, crude oil prices have risen twice — with the people bearing the costs.

This scenario is increasingly common in energy-constrained Africa. Over-reliance on fossil fuels has long drained national budgets. Fuel prices are rising by the day and with little control over internationally determined prices, governments are seeking alternatives to meet the fuel needs of a rising urban population.

African governments are increasingly looking to biofuel as a viable way to do this.

Africa's 'oil fields'
According to Njeri Wamukonya, an energy expert with the UN Environment Programme, worldwide investment in bioenergy reached US$21 billion last year.

"Governments in developed and developing countries are putting in place bioenergy targets, with the main drivers being the energy security, climate change and development concerns," says Wamukonya. The European Union, for example, has announced that it targets its member states to generate at least ten per cent of their energy from biofuels by 2020.

This increased demand for biofuel provides a market opportunity for the South, with its available natural resources. For instance, Brazil was producing 33 per cent of the world's biofuel ethanol by the end of last year.

African countries are keen on transforming their expansive farmlands into the next 'oil fields'.

The choices of crop are diverse — from corn to rapeseed and jatropha. Liquid biofuels include biodiesel derived from plant oils and bioethanol made from sugarcane, maize and other starchy crops. Global production of biofuels consists primarily of ethanol.

According to Cornelis van der Waal, an industry analyst with Frost & Sullivan — a South Africa-based consultation company providing advice on development policies — Africa has great biofuel potential due to its vast arable land and workforce.

He says, "Africa is by no means a current participant in the biofuels race compared to the rest of the world, but could potentially become the most important contributor to alternative fuels."

"The question is not so much on whether Africa is ready for a biofuel revolution, but rather can Africa afford to miss the biofuels opportunity?":
energy :: sustainability :: ethanol :: biodiesel :: biobutanol :: biomass :: bioenergy :: biofuels :: Africa ::

Lagging behind in the biofuel race
A pan-African ministerial meeting held in March this year in Maputo, Mozambique marked a turning point. African ministers responsible for energy development in their countries announced a declaration committing to increased research in the development of renewable energy — notably biofuels. This has made many investors take a keen interest in the production of biofuels in Africa.

However, energy analysts say that investment in Africa has failed to take note of basic research needed. Despite well-established national agricultural research centres across Africa, there is little research to improve crops to yield more ethanol and biodiesel.

Van der Waal says that many African countries investigating biofuels, such as Kenya and Mozambique, do not currently have a large enough capacity for biofuels research.

He adds that biofuels research in Africa is inadequately funded, with most of it coming from governments and conducted in universities.

According to van der Waal, African countries should follow Brazil's lead, where both the government and the private sector conduct research, sustaining an ethanol industry for more than 20 years. He says one of the continent's strong points is its capacity to combine government and private research on biofuels, something it is not yet taking advantage of.

Current biofuels research also focuses too much on increased production efficiency rather than quality products, he says, adding that there are opportunities for many other biofuel products and applications besides ethanol and biodiesel. For instance, home-use fuel, such as paraffin, wood and coal, could be replaced by ethanol gel, made by mixing ethanol with a thickening agent and water. The gel fuel burns without smoke, and so does not cause respiratory problems associated with current fuels used in the home.

Catching up
Several African countries have biofuel research projects underway.

Nigeria, the world largest producer of cassava, is keen to use its major crop as an alternative to fossil fuel. The country currently uses a ten per cent blending standard of cassava ethanol with gasoline, though this is not compulsory.

Nigeria aims to produce cassava ethanol worth over US$150 million every year, once it establishes a suitable infrastructure. This includes construction of 15 ethanol plants with assistance from Brazil.

And in May, the government announced plans to establish a US$100 million 'biofuel town' near the capital, Lagos. This will create a 600 hectare settlement of 1,000 bioenergy experts — primarily from Nigeria, but also from other African countries and Brazil — who will work on novel technologies to improve bioenergy production.

Nigeria also aims to start importing Brazilian ethanol-powered vehicles by 2010.

This ambition is mirrored by Malawi. In October, the Ethanol Company of Malawi, a private fuel company, announced that it will import flex-fuel vehicles from Brazil to be used in a government-backed initiative to investigate the practicability of using ethanol-based fuels to power vehicles.

Malawi currently uses gasoline blended with ten per cent locally-made sugarcane ethanol. Through a public-private venture, the Malawi department of science and technology is implementing a research project to explore how local biofuels could alleviate the country's energy needs. The highlight of research so far is the testing of a Mitsubishi Pajero car modified to run on ethanol in place of petrol for a distance of 1,000 kilometres.

The Brazilian influence is also apparent in neighbouring Mozambique, which shares a connection with Brazil as another former Portuguese colony. The southern African country has developed an effective biofuel sector based on sorghum and sugarcane, and the government has set aside over US$700 million for biofuel research, production and promotion.

Energy experts say Mozambique has potential to be a 'biofuel superpower'. Van der Waal says the country has sufficient rainfall for extensive production of sugarcane, which is currently the most efficient crop for ethanol in terms of production cost, being much faster to process and producing more sugar (thanks to its water content) than maize or sorghum.

Scientists from the International Crops Research Institute for the Semi-Arid Tropics (ICRISAT) are developing sorghum varieties and hybrids that have higher amount of sugar-rich juice in their stalks for Mozambique.

ICRISAT is also working with a private Mozambican company, Rusni Distilleries Ltd, to establish a facility capable of producing 100,000 litres of sorghum ethanol a year. The venture has received a total investment of around US$30 million from Rusni, ICRISAT, and the Mozambique government, and, if successful, could boost the livelihood of 5,000 smallholder farmers through contract farming. ICRISAT and Rusni plan to collaborate with Petromoc, the national petroleum company of Mozambique to market the fuel.

Assessing the risk
Increased attention on biofuel research and development is, however, bringing a new debate to the continent. There is the worry that an increase in the use of food crops such as maize, cassava and sorghum is likely to increase the food price of most staple foods in Africa, notably corn.

"Price rise will depend on whether or not oil crops are planted on arable land that could otherwise be used for growing food crops, and whether water is diverted from food crops to irrigate the biofuel plantations," says Jeremy Wakeford, a senior lecturer in economics at the University of Cape Town in South Africa.

The debate of crops for food versus crops for biofuels remains one of the major problems yet to be resolved in the sector. And it may affect Africa even if the continent does not enter the biofuels market.

Njeri Wamukoya says increasing biofuel development is likely to affect food aid. The United States for example, provides food aid from its surplus crops. "[But] if the surplus is used for [US] biofuels, will the United States supplement [food aid] with cash, and will the cost of food go up as a result?"

Wakeford says producing food for the population should be given priority, and suggests that new developments from research programmes will keep the biofuel sector going.

There is a need to diversify the sources and methods used to generate biofuel products, according to Mpoko Bokanga, director general of the African Agricultural Technology Foundation, which promotes technology transfer in Africa.

Addressing an African conference on biofuels in Addis Ababa, Ethiopia, in August, Bokanga said one possibility is to move from ethanol to butanol fuel production.

Butanol fuel can be manufactured from corn and molasses, has a high energy content and can be shipped through existing fuel pipelines. It is also safer to use than ethanol and gasoline, as it is less likely to evaporate into the surrounding air (which creates a fire risk). However, there has been little to no effort to promote butanol fuel because of historically low production yields compared to ethanol.

Bokanga also called for the establishment of 'bioenergy scientific units' in African countries conducting biofuels research, with experts available to advise governments on improving production efficiency.

The triple challenge facing Africa is achieving food security, energy security and sustainable development. Biofuels provides an opportunity to harness Africa's vast biomass resources, but for that more research on better yielding crops, production methods, and use is needed. The journey has only just begun.

Reprinted with permission. Thanks to SciDev's David Dickson.

References:
SciDev: Biofuel: Africa's new oil? - December 5, 2007.

SciDev: Spotlight on Biofuels: The research challenge - Dossier, December 2007.

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France introduces impressive bonus system for low emissions vehicles; €5000 for electric cars

As a result of its recently held 'Grenelle Environnement' (national environment summit), the French government initiated an impressive bonus/malus system for new vehicle purchases based on their CO2 emissions per kilometer. Buyers of eco-friendly cars receive rebates ranging from €200 to up to €5000. The system is financed by a malus imposed on those who buy vehicles with a high emissions profile.

Electric vehicle purchases are rewarded most. In France, electric cars would be very green on a well-to-wheel basis because over 75% of the country's electricity is generated from nuclear sources. Electric cars can also be powered by carbon neutral renewables like biomass, wind or solar energy. In the future, they could even utilize negative emissions electricity obtained from biomass the CO2 of which is geosequestered (so-called 'bio-energy with carbon storage'). In such a case, driving a car would mean actively taking emissions from the past out of the atmosphere (previous post on 'driving in the strange world of carbon negative energy').

The ecobonus starts for vehicles which emit less than 130 g CO2/km, which covers around 30% of current sales. This rebates will be complemented by a 'superbonus' when the buyer offers a vehicle older than 15 years for scrapping. Those who buy a new car that emits more than 160g CO2/km receive a malus; this concerns roughly 25% of all vehicles currently sold in France.

The new mechanism, which constitutes the first application of the ecological 'price signal' strategy proposed by the Grenelle, is purely indicative. It has been created in such a way that the malus finances the expenses needed to cover the bonuses. Therefor, the system does not imply new government expenses or taxes for households or businesses.

The rebates are progressive: the lower the CO2 emissions of the new car, the higher the bonus:

• €1000 for vechiles emitting less than 100gCO2/km
• €700 for vehicles the emissions of which range between 101 and 120gCO2/km
• €200 for cars with modest emission reductions ranging between 121 and 130gCO2/km

The malus progresses along the lines of the following scale:

• €200 for vehicles the emissions of which range between 161 and 165gCO2/km
• €750 for cars with emissions between 166 and 200gCO2/km
• €1600 for emissions between 201 and 250gCO2/km
• €2600 when the vechiles are extremely climate unfriendly with emissions of over 250gCO2/km

The highest penalty involves large, polluting 'luxury' cars as well as some classes of SUVs which represent around 1% of the market.

There is no bonus nor a malus for cars the emissions of which are close to the current average - namely between 130 and 160gCO2/km. This 'neutral zone' represents roughly 45% of all new cars sold in France:
energy :: sustainability :: nuclear :: renewables :: biomass :: bioenergy :: greenhouse gas emissions :: transportation :: negative emissions :: bio-energy with carbon storage :: electric car :: France ::

The superbonus of €300 will be paid when the purchase of a new car eligible for a bonus is accompanied by the scrapping of a car older than 15 years. This super bonus comes on top of the already existing eco-boni for the scrapping of old cars offered by auto manufacturers. This system will encourage the withdrawal of old cars from the roads and contribute significantly to reducing air pollution.

In order to promote ultra-clean and efficient vehicles, the French government will also reward those who buy an electric car. A payment of €5000 is foreseen for cars that emit less than 60gCO2/km.

The trehsholds of the bonus/malus system will be tightened by 5gCO2/km every two years, in order to encourage auto manufacturers to produce more and more low emissions vechicles.

The French government hopes to have the legislation for this new mechanism formalized before the end of the year.

With this range of measures, the Grenelle proves its usefulness. The Summit united all stakeholders - industry, civil society, government, non-governmental organisations - with the aim to find compromises on ways to tackle the most urgent environmental matters, in particular climate change. The feebate system will not impact the purchasing power of households, because the operation is budgetary neutral. In total, over 75% of all new vechiles sold in France will benefit either from a bonus or from a tax exemption (on the basis of numbers for vehicle sales in the year 2006.)

The scheme was announced by minister for the environment Jean-Louis Borloo, minister of economic affairs Christine Lagarde and by Eric Woerth, minister of the budget. They think it will "reduce the price of eco-friendly cars, make the consumer more responsible, speed up the greening of the country's vehicle fleet and stimulate technological innovation in the automobile sector, allowing car manufacturers to create and offer cleaner vehicles".

References:
Ministère de l'Écologie, du Développement et de l'Aménagement Durable: "Le bonus écologique incitera dès aujourd’hui les acheteurs de voitures neuves à se porter vers les véhicules les plus sobres en carbone" - December 5, 2007.

Biopact: The strange world of carbon-negative bioenergy: the more you drive your car, the more you tackle climate change - October 29, 2007

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Scientists discover methane-eating bacterium that could help fight climate change

A new species of bacteria discovered living in one of the most extreme environments on Earth could yield a tool in the fight against global warming. In a paper published today in Nature, University of Calgary biology professor Peter Dunfield and colleagues describe the methane-eating microorganism they found in the geothermal field known as Hell's Gate, near the city of Rotorua in New Zealand.

It is the hardiest 'methanotrophic' bacterium yet discovered, which makes it a likely candidate for use in reducing methane gas emissions from landfills, mines, industrial wastes, geothermal power plants, and peatlands. The discovery once again suggests that investigating life in extreme environments - the search for useful 'extremophiles' - can contribute to solving some of the world's biggest problems. The bugs are finding applications in a wide range of fields, from the production of innovative pharmaceuticals to the efficient conversion of biomass into abundant biofuels (previous post).

The exotic bacterium discovered in Hell's Gate is a really tough methane-consuming organism that lives in a much more acidic environment than any of the scientists have ever seen before. It belongs to a rather mysterious family of bacteria called Verrucomicrobia that are found everywhere but are very difficult to grow in the laboratory.

Methanotrophic bacteria consume methane as their only source of energy and convert it to carbon dioxide during their digestive process. Methane (commonly known as natural gas) is 20 times more potent a greenhouse gas than carbon dioxide and is largely produced by decaying organic matter. Scientists have long known that vast amounts of methane are produced in acidic environments, not only geothermal sites but also marshes and peat bogs. Much of it is consumed by methanotrophic bacteria, which serve an important role in regulating the methane content of the world's atmosphere.

Scientists are interested in understanding what conditions cause these bacteria to be more or less active in the environment. Unfortunately, few species have been closely studied. We now know that there are many more out there.

Professor Dunfield has tentatively named the new bacterium Methylokorus infernorum to reflect the 'hellish' location of its discovery where it lives in boiling waters filled with chemicals that are toxic to most life forms:
energy :: sustainability :: biomass :: bioenergy :: biofuels :: methane :: greenhouse gases :: climate change :: extremophile :: bacteria ::

The Maori caretakers of the site, the Tikitere trust, have supported scientific study of the area. The study was conducted while Dunfield was working for GNS Science, a geological research institute owned by the New Zealand government. He recently joined the University of Calgary's Department of Biological Sciences as a professor of environmental microbiology.

The bacterium's genome has been completely sequenced by researchers at the University of Hawaii and Nankai University in China, which could help develop biotechnological applications for this organism.

Dunfield said he plans to pursue his work in Canada by hunting for new life forms in extreme environments such as northern peatlands, the oilsands of northern Alberta and the hot springs of Western Canada.

Hot springs are exotic and extreme habitats, where you find a lot of bizarre organisms. Bacteria are a fascinating group to work with because 95 per cent of them have never been studied in a lab and we have very little idea about what this huge amount of biodiversity is capable of. - Peter Dunfield, Professor of Biology, University of Calgary

Dunfield's Nature article was published online on November 14, 2007 and in the December 6 edition of the journal.

References:
Peter F. Dunfield, et al., "Methane oxidation by an extremely acidophilic bacterium of the phylum Verrucomicrobia", Nature 450, 879-882 (6 December 2007), doi:10.1038/nature06411

Biopact: Investigating life in extreme environments may yield applications in the bioeconomy - July 05, 2007

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Industrial giants to reopen 15 closed sugar mills in Bihar; ethanol boom triggers rural revival

The sugar cane industry in India's Bihar state employs a large number of small farmers. Over the past decade, however, the sector has undergone a serious decline with falling world sugar prices, resulting in a social drama. The stagnation of the sugar cane industry saw more than a dozen mills being closed. But now, with record oil prices and the competitiveness of sugar cane derived ethanol, the sector is in for a major revival.

The Bihar State Sugar Corporation, under auspices of the state government, offers 15 closed mills under a long term lease of 60 years, extendable to 30 years. Some of India’s leading oil and industrial companies - Reliance Industries, Tata Chemicals, Fieldfresh of Bharati Enterprises and India Oil - have all expressed their interest in reopening them to produce ethanol.

Other companies that have purchased RFQ forms to make bids are Bharat Petroleum, Hindustan Petroleum, Renuka Sugars, Upper Ganges Sugar, Dhampur Sugar and India Glycols. Officials in the government-owned IOC, the country's largest refiner, also confirmed that it intends to make ethanol and will enter the bidding.

Closed for more than a decade, the mills together have a financial liability of 7 billion rupees (€121.3/US$177.4) under various heads and the funds raised by leasing them will be used to clear the liabilities.

The floor price of these mills, mostly based in northern Bihar, has been fixed at between 80 million (€1.38/US$2 million) and 700 million rupees (€12.1/US$17.7 million). The state is offering a capital subsidy of 10 percent of the investment, subject to a 100 million rupee ceiling.

Earlier this year, India's central government had made 5 per cent blending of ethanol in petrol mandatory and it would increase it to 10 percent by October 2008. This is an ambitious target, but it goes a long way in relieving sugar producers from the oversupply problems they have been facing.

In India, ethanol is made from molasses, a byproduct of sugar cane processing. The efficiency and cost-effectiveness of sugar cane ethanol is largely due to the high sugar yield of the plant and because these sugars can be readily fermented. Ethanol made from starches must first be broken down into simple sugars, whereas the utilization of lignocellulosic biomass requires even more complex thermochemical or biochemical processing steps.

Bihar currently has 252,000 hectares dedicated sugarcane cultivation and produces around 14.4 million tonnes of sugarcane every year. Compared to other states, Bihar is a relatively small player, with a 3% market share (map, click to enlarge). But the land area devoted to sugarcane accounts for only 4.5 per cent of the state’s cultivable area of more than 5.5 million hectares. This means there is vast scope to increase the sugarcane acreage:
energy :: sustainability :: biomass :: bioenergy :: biofuels :: ethanol :: bagasse :: molasses :: sugarcane :: rural development :: Bihar :: India ::

Earlier this year, the Bihar state government amended the Bihar Sugarcane Regulation of Supply and Purchase Act of 1981, allowing sugarcane juice to be directly used to produce ethanol or rectified spirit. The new law also allows the use of bagasse, an abundant sugarcane byproduct, for co-generation of power. Integrated sugar and ethanol plants that utilize bagasse, can produce biofuels with a very strong energy balance.

Out of the 15 closed sugar mills on offer, eight have been reserved for sugarcane based industries like sugar mills, distilleries for ethanol and alcohol production while seven are allowed to be converted into non-sugarcane facilities.

According to state’s Sugarcane development minister, Nitish Mishra, a pre-bid meeting is to be held on December 8 in New Delhi. All bids need to be submitted by the December 20. The leasers will be shortlisted on December 29.

Sugarcane based ethanol has had no impact on world sugar prices so far. This is due to the fact that both Brazil and India made record harvests this year. Next year's harvest is set to break the record again. India has the world's second largest sugar industry, producing some 14 million tonnes of refined sugar per year from cane grown on 3.6 million hectares of land.

Mired by oversupplies, the sugar sector in India this year urged the government to urgently adopt mandatory ethanol targets, in order to push up the price of the commodity. The government responded with the ambitious 10% target for 2008, which will require the production 825,000 tonnes of ethanol (roughly 1 billion liters / 227 million gallons).

References:
Bihar Times: Corporate giants interested in sugar mills of Bihar - December 6, 2007.

Business Standard: Reliance, Tata, Bharti eye Bihar sugar mills - December 6, 2007.

CommodityOnline: Oil giants eyeing Bihar sugar mills for ethanol - December 6, 2007.

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IMF chief economist: biofuels could help cut farm subsidies, protectionism main cause of high food prices

The trend toward increasing production of biofuels provides an opportunity to dismantle agricultural subsidies and tariffs in wealthy countries, according to the International Monetary Fund’s top economist. Non-governmental organisations and developing country governments have been calling for farm subsidy and trade reform for years, to give producers in the South a chance to develop domestic markets. Biofuels offer an opportunity to bring about this much needed transformation.

Writing in the December issue of the IMF’s Finance & Development magazine, Chief Economist Simon Johnson looks at how the adoption of biofuels in the EU and the US is driving up world food prices and how the trend can be curbed. Over the past 12 months, the world has experienced a substantial inflationary shock in the form of higher food prices, partly fueled by increasing demand for food crops such as corn, used for biofuels. This shock doesn’t necessarily translate into higher sustained inflation, Johnson writes; monetary policy in most countries appears to be responding appropriately. But it will have adverse effects relatively poor urban residents in low-income countries who depend on imported food.

However, there are two potential major silver linings: direct benefits for farmers in low-income countries and potential policy space for removing agricultural subsidies in rich countries. The vast majority of people qualified as 'poor' are farmers in developing countries. They stand to gain directly from the emerging biofuels industry.

In the IMF staff’s assessment, a significant part of the latest jump in food prices can be traced directly to biofuels policy in wealthy countries, Johnson writes.

A key part of this approach to biofuels is agricultural protectionism. A number of countries, including Brazil, can produce ethanol much cheaper, with a greater saving of nonrenewable energy and lower emissions, for example, by using sugar. But this sugar-based ethanol is subject to a prohibitive tariff in the United States (and there are similar barriers in Europe). - Simon Johnson, IMF Chief Economist

In addition, production subsidies in rich countries, which are intended to encourage innovation in this sector, seem to have led to excessive entry into the US ethanol distillery business.

The greatest potential gains of using crops for biofuels are for farmers everywhere, including the rural sector of poorer countries, Johnson writes:
energy :: sustainability ::biomass :: bioenergy :: biofuels :: ethanol :: biodiesel :: subsidies :: trade :: tariffs :: IMF ::

There is another potential opportunity in this rapidly developing difficult situation, Johnson writes.

Farm subsidies of various kinds in rich countries have long plagued the international trading system and currently make it difficult to move forward with further trade liberalization. Rich countries are reluctant to improve access to their most protected markets.

With high food prices, subsidies are less compelling and—depending on how they are structured—may not even pay out when prices are above a certain level, Johnson writes.

Industrial countries need to seize this moment and eliminate subsidies in such a way that it is hard to reimpose them later.

Johnson cites the example of the European Union's 'impressive step forward' in terms of export subsidies for milk. With milk at record-high prices this year, these subsidies have been suspended. Given the nature of decision making over agricultural policy, reinstating such subsidies might be difficult.

More recently, the EU also decided to abandon a subsidy for energy crops.

Hat tip to Jeff!

References:
Simon Johnson, "The (Food) Price of Success", Finance & Development, December 2007, Volume 44, Number 4.

Research Recap: "Biofuels Could Help Cut Farm Subsidies" - December 5, 2007.

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South Africa approves biofuels plan: 2% by 2013, maize excluded

After months of negotiations and intense lobbying by different sectors, South Africa has approved its long awaited biofuels plan. The country will aim to have biofuels account for 2 percent of its total fuel production by 2013 but will exclude the staple maize as a source. Compared to most other sub-Saharan African countries, South Africa an extremely small per capita potential for the production of biofuels and thus has to be far more careful in setting targets.

The biofuels strategy was developed in response to concerns over fuel supply security and volatile international crude oil prices. South Africa meets about 36 percent of domestic liquid fuels demand by the production of synthetic fuels made from coal - a technique that releases large amounts of greenhouse gases. The remaining 64 percent is refined locally from imported crude oil.

The new strategy envisages a pilot phase for biofuel production starting next year, with the 2013 target revised downward from an initial draft proposal of 4.5 percent.

According to Minerals and Energy Minister Buyelwa Sonjica, the revision expresses consideration of agricultural concerns, adding that maize would not be used for the development of biofuel in the initial stages of the plan, due to food security concerns. Maize is a staple food source for the majority of the poor in the country.

The decision to exclude maize comes a day after local farmers’ representative body Grain SA said that using the grain to produce biofuels would create new markets for farmers and utilise South Africa’s unused land:
energy :: sustainability :: biomass :: bioenergy :: biofuels :: ethanol :: biodiesel :: maize :: food security :: South Africa ::

The government's biofuels plan only takes into account first generation biofuels made from easily extractibe oil and sugars. Soya beans, canola and sunflower would be used for biodiesel production, and sugar cane and sugar beet for ethanol.

As an incentive, the fuel levy exemption on biodiesel will increase from 40 to 50 percent, while bioethanol will enjoy a 100 percent exemption.

The plan does not include any details about possible biofuel imports. South Africa's neighboring countries all have a very large potential for biofuels.

References:
AFP:
South Africa aims for 2.0 percent biofuels production by 2013 - December 6, 2007.

The Times: SA approves biofuels plan - December 6, 2007.

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US National Renewable Energy Lab aims to cut GHG emissions by 75% with solar and biomass

The U.S. Department of Energy's National Renewable Energy Laboratory (NREL) has pledged to reduce its own greenhouse gas emissions by 75 percent from 2005 to 2009 - an ambitious goal, but one that does not come as a surprise given that the NREL is America's leading research lab focused on renewables. The new target is part of NREL's participation in the Environmental Protection Agency's (EPA) Climate Leaders program and was announced at the Climate Leaders meeting in Boulder, Colorado yesterday.

To achieve its new goal, NREL will install two major on-site renewable energy projects:

• solar cells on a five acre site will provide approximately 7 percent of the Laboratory’s electric needs
• a biomass combustion plant fueled by forest thinnings and other waste wood will offset the need for about 75 percent of the natural gas used to heat the Laboratory's research buildings

In addition, NREL is planning to make its buildings more energy efficient through a site-wide energy savings performance contract. The Laboratory also will purchase renewable energy certificates (RECs) to offset all of its indirect emissions from electricity use and from Laboratory operations such as employee commuting and business travel.

NREL already reduced its greenhouse gas emissions by 10 percent per square foot from 2000 to 2005 as one of the seven original Climate Leaders participants that set goals and met them.

I am fully convinced that our mission is both enabled and enhanced by our leadership in sustainability. The employees of NREL are committed to incorporating sustainable principles in our work, and we encourage application of these same principles by our stakeholders. Through our actions we can establish a new benchmark for what is possible. - Dan Arvizu, NREL Director

NREL’s participation in Climate Leaders is a key part of the environmental stewardship activities of its Sustainable NREL program, which is responsible for leading the planning, development and implementation of the Laboratory’s comprehensive suite of sustainability activities. As a national laboratory, NREL actively shares its experiences with other national laboratories, federal and state agencies and other interested stakeholders:
energy :: sustainability :: biomass :: bioenergy ::