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22 June 2007 - The US Senate has just passed a massive increase in the Renewable Fuels Standard in the form of the bill (S.1419), the "Renewable Fuels, Consumer Protection, and Energy Efficiency Act of 2007".
- This bill will expand the Renewable Fuel Standard to 36 billion gallons by 2022, by requiring that fuel blenders incorporate increasing percentages of biofuels, such as ethanol and biodiesel.
- Corn ethanol is capped at 15 billion gallons, which is still three times today's level of production. 15 billion gallons of corn ethanol would have required 60% of the 2006 corn crop.
- The remaining 21 billion gallons will come from "advanced biofuels", which means everything but corn ethanol: biodiesel, sugarcane ethanol, cellulosic biofuels, biobutanol etc.
- All biofuels will have to meet a 20% greenhouse gas emissions improvement over gasoline, although a tougher set of standards didn't make it into the bill.
- One amendment that did make it into the bill provided for an EPA study of the sustainability of biofuels and establishes a $500 million grant program to encourage the production of advanced biofuels which have the best improvements in greenhouse gas emissions.
- It is possible the House will take this up in time for the July 4th, "Energy Independence" package, but the bill's ultimate fate is far from clear....
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14 June 2007
This week looks to be an important one in the history of bioenergy, as a massive bill (S.1419), the "Renewable Fuels, Consumer Protection, and Energy Efficiency Act of 2007", which may dramatically increase the use of biofuels for both transportation and electricity looks likely to come up for a vote in the US Senate.
- The expansion of the Renewable Fuel Standard to 35 billion gallons by 2012 is the centerpiece of the leading bill, and numerous amendments, including one to tighten the requirements for greenhouse gas emissions from biofuels, are likely to be introduced.
- Although the bill currently doesn't deal with biofuels for electricity, an amendment to add a Renewable Electricity Standard, which would mandate that 15-20% of US electricity come from renewable sources, including biomass, is also likely to be submitted.
- The success or failure of many of these amendments could make a huge difference in terms of whether this bioenergy push is truly sustainable or not, and we will be updating you regularly on developments!
1 June 2007
Despite the European Commissionand the US Congress both trying to develop biofuel policies to massively expand the biofuels industry, much will depend on whether the technology can live up to the promises the politicians are making for it. Still, each week seems to bring another technical breakthrough in biofuels...
- This week's was the announcement by University of Georgia researchers of a new version of pyrolysis.
- Pyrolysis has already begun to be commercialized as an efficient way to convert a range of cellulosic feedstocks into a heavy bio-oil that is suitable for use as a heating oil or generator fuel.
- Although the details are unclear, this new process can produce an oil suitable for use in conventional vehicle engines or for blending with biodiesel.
- If combined with the modular pyrolysis units that companies like Dynamotive are developing, it is possible to imagine the development of decentralized biofuel production that can avoid some of the incredible infrastructure challenges involved with getting biomass to factories.
- In the end, it will be the ways that policy and technology interact that will determine how soon we will see the next-generation of bioenergy come on-line, and what its impacts will be.
12 May 2007
Although it hasn't attracted much press yet, there is an interesting debate on biofuels happening right now in the US Senate.
- S. 987, The Biofuels for Energy Security and Transportation Act of 2007 is a bill that has been proposed in the Senate to, among other things, increase the Renewable Fuel Standard to 36 billion gallons by 2022, with 21 billion gallons reserved for "advanced biofuels", meaning anything but corn ethanol. This is a massive increase over the 7.5 billion gallon by 2012 in the current standard.
- A number of environmental groups have expressed concern that there are no greenhouse gas standards or sufficient guarantees that feedstocks will be produced in a sustainable manner.
- The bill is still in committee and it is likely to be amended before it has any chance of becoming law, but the outcome of this debate could have a huge impact on whether biofuels realize their promise of being a climate-friendly, sustainable alternative to fossil fuels or just another part of the problem.
- We will continue to report on any developments in the progress of this bill...
20 April 2007
A recent statement by the UK Transportation Ministers touched on some interesting aspects of the debate over the sustainability of biofuels.
- The Minister emphasized that sustainability standards had to be a part of the UK's biofuel mandate, the Renewable Transport Fuel Obligation.
- But he defended the policy of initially only requiring carbon and environmental reporting from biofuel producers.
- He argued that since internationally recognized standards don't yet exist, the UK could risk WTO challenges if they were mandatory.
- The Roundtable on Sustainable Biofuels is one attempt to create such an internationally recognized set of standards. By bringing together a wide-range of stakeholders, the RSB hopes to get wide support for a set of standards, which could be used as a base for a future version of the RTFO or other legislation.
13 April 2007
The recent attacks on US biofuel policy by Hugo Chavez and Fidel Castro seem to indicate increasingly polarized positions in the debate over bioenergy.
- The real picture is more complex. Both Cuba and Venezuela are working to increase their own production of ethanol from sugarcane. Their attacks are not on the fuel itself, but on the US extensive use of a food grain, corn, to produce it.
- What the harsh rhetoric conceals is the growing consensus that biofuels are going to be a growing part of the energy mix in the future: although how big a mix and what the impacts are going to be is clearly an open point of debate.
- In other words, the question is no longer "why biofuels?" but "which biofuels?".
6 April 2007
One of the things that makes bioenergy such an exciting area right now is the potential for big surprises. One of the things that make bioenergy such an exciting area right now is the potential for big surprises.
- The Malaysian company that has created the first nypa palm ethanol project has announced that it will be able to produce over 6 billion liters of ethanol when its plant opens in 2009. This is a huge amount, equivalent to something like a third of current US production.
- Although nypa palm, which can be tapped year round for its sugar-rich sap, has been reported to produce up to 15,000 liters of ethanol/ha, the article only mentions 10,000 ha of land covered in wild palms leased from the Perak state government. That only accounts for 150 million liters of ethanol, leaving it an open question where the rest of this ethanol will actually come from. And that assumes that the most optimistic scenarios for harvesting nypa sap actually work out.
- Still, if this company succeeds in producing even a substantial percentage of what it is claiming, it will shake up the whole biofuel industry.
- Here is a tiny company, harvesting sap from an unknown plant from mostly wild stands, that might become one of the largest producers of ethanol in the world in just a few years.
- While the majority of grandiose claims about vast biofuel production are likely to be exaggerated, it may only take one to change the world. So while a healthy dose of skepticism is necessary, keep your eyes open for what might be around the corner.
29 March 2007
It seems that recently everyone has a strong opinion on bioenergy:
- Fidel Castro has come out stating that US biofuel policy, particularly the use of cornto produce ethanol would "would cause 3 billion deaths from hunger".
- A few days later, a Brazilian report suggested that Brazil could supply 10% of the world's gasoline demand with ethanol in 18 years "without sacrificing forests, protected areas or food cultivation".
- Although the products of very different processes, these two statements represent the radically different visions that are shaping up around bioenergy: one a vision of a more secure and sustainable world and the other a vision of ecological collapse and injustice.
- Yet, there is nothing intrinsic about bioenergy and biofuels that destines them to move down either path. The devil is very much in the details, and in the choices that we make in developing this revolutionary new industry. Hopefully, if we pay enough attention to the real problems that may arise, we can set ourselves on a path that lets us avoid them entirely.
22 March 2007
With all of the big events and international agreements in bioenergy that have been happening recently, it is easy to miss the day-to-day developments that are transforming our world.
- This week a company announced the first delivery of biogas into the natural gas grid in the US.
- Biogas, produced efficiently and sustainably from agricultural waste or dedicated energy crops, could become a major source of electricity, heat and even transport fuel in compressed natural gas (CNG) vehicles.
- Every week small milestones like this are progressively transforming our world. It is up to us to pay attention to what is happening and make sure that we are going in the direction we want to be.
15 March 2007
Last week saw a fascinating moment in bioenergy policy as Brazil and Indonesia signed an agreement and created the Brazil-Indonesia Consultative Committee on Biofuels.
- The development of South-South agreements to promote bioenergy potentially heralds a major change in what drives international policy.
- The agreement will provide Brazilian expertise for the Indonesian ethanol industry, which is still in its infant stages.
- Indonesia, which has recently flipped from being an oil-exporter to being an importer, could either export the biofuels they produce or use them to subsitute for domestic production, allowing them to export oil again.
- Indonesia is primarily banking on biofuels to provide rural jobs and bring development to the countryside.
- Still the millions of low-wage, low-security jobs that have been produced by the Brazilian sugarcane industry, and are now being phased out through mechanization may not present the best development option for Indonesia.
- The question then is whether Brazil can help Indonesia leapfrog to a more socially and environmentally stable biofuels industry or whether they just export a new set of problems.
8 March 2007
The two big events in bioenergy last week were both policy events. First was the signing of the memorandum of understanding between the United States and Brazil on biofuels.
- The second was the EU's agreement on a binding 20% target for renewable energy by 2020.
- Although it is clear that a real international consensus is developing on the importance of creating clear goals and standards for bioenergy these two events also highlight the divisions in the international community.
- Trade issues, particularly the US ethanol tariff, were not included in the MOU, which may focus on joint US-Brazil projects to help other countries develop their own biofuel industries.
- The EU agreement was nearly derailed by France, which wanted to protect its nuclear power industry. The final agreement also allows a country to have less than the 20% in renewables as long as the total EU target is reached. Most likely this means that some countries, like Germany, will have to pick up the slack from other countries, which could lead to some complex imbalances down the line....
1 March 2007
On Friday the International Biofuels Forum was announced at the UN in New York. This group will contain Brazil, the United States, China, India, the EU and South Africa, who together produce most the world's biofuels.
- The idea behind the Forum is to work towards biofuels, like ethanol, becoming a global commodity by setting standards and sharing information.
- Still, international agreements like this one may conflict with the domestic agenda's of many investing in the industry.
- The US has stated that they will not consider repeal of the ethanol tariff that protects domestic producers.
- The tension between the need for a global bioenergy market and the need to protect farmers is an old story for those who have followed the progress (or lack of it) in world trade talks.
- It also points to an inherent contradiction in the world bioenergy industry. Despite Western promises of biofuels as a way to energy independence, it is the countries of the Global South that are best able to expand production in the short-term.
22 February 2007
On Wednesday the 20th of February, the Wilson Center in DC held a panel called The Global Dynamics of Biofuels: Potential Supply and Demand for Ethanol and Biodiesel in the Coming Decade, featuring US and Brazilian academics and diplomats discussing the future production of biofuels and their impact on agriculture and trade. Some points of interest:
- Bruce A. Babcock of Iowa State University predicts that, assuming current trends, the high price of corn will slow the pace of ethanol plant construction and production will peak at around 14 Bil. gallons in 2010 with corn prices more less stable in the $3.50 range.
- Much of the extra acreage will come from reductions in soybeans, which send soybean prices up to $7.20/bushel.
- On the world stage, countries like Brazil and Argentina will ramp up production of corn and soybeans to compensate for smaller world exports.
- The impact on US food prices would be relatively small, in the range of a .25% increase in total spending. Livestock producers in other countries who are dependent on corn and soybean meal as feed would be the most affected.
- Of course, fluctuations in the price of oil, weather patterns or policy could shift this picture in a variety of different directions....
- Later more on the prospects for Brazilian ethanol and diplomatic issues around the US ethanol tariff....
8 February 2007
This week saw several major developments in biofuel policy around the world. Energy ministers for the European Union agreed on a 10% biofuel target by 2020.
- In a key recognition that all biofuels are not created equal, the "mandate" is only binding "subject to production being sustainable, (and) second-generation biofuels becoming commercially available."1
- The agreement by the Energy Ministers must still be approved at the Spring European Council in early March.
- Once it is approved, the stage is now set for a robust discussion of what exactly sustainable means and the developments of clear standards.
- New Zealand has also passed a binding biofuel mandate of 3.4% by 2012, although since there is no industry to speak of in New Zealand, no one is quite sure where the fuel will come from or how it will be produced.
- This proliferation of biofuel mandates, without a clear sense of how the fuel is going to be made highlights the need for a rational discussion of how biofuels can be produced in a way that helps rural communities and improves, rather then damages, the environment.
- At a recent UNEP meeting in Nairobi there has been a renewed call for the trade in biofuels to be governed by sustainability standards.
- In fact the debate over what those standards should be has already begun in earnest around the world.
- In Europe, the European Commission's proposal to create a low carbon fuel standard and strengthen emmissions requirements for cars has met with strong resistance from the industry.
- Depending on how the carbon life-cycle of different biofuels is calculated, it could discourage the use of energy-intensive crops, like corn, and land-use changes, like clearing forests to grow plantation crops, that release large quantities of CO2.
- In the US, the battle over how biofuels will be funded in the Farm Bill is heating up, with some people arguing that lands be brought out of the Conservation Reserve Program (CRP) so that industrial corn for ethanol can be grown, with no standards or restrictions on the use of fossil-fuels in production and manufacturing.
- While other groups have proposed supporting farmers to grow dedicated energy crops with a full range of environmental, soil and wildlife protections.
- The outcome of these policy conflicts will shape these industries, and the face of our world for years to come.
1 February 2007
- With President Bush's proposal to increase renewable and alternative fuel consumption in the United States to 35 billion barrels in 10 years, interest in biofuels is reaching a fever pitch.
- The last few weeks have seen major biofuel plans announced in Chile, The Philippines and Indonesia among others. China is working to develop more biofuels from crops like cassava and sugar cane, in order to reduce competition between food grains and fuel alcohol.
- While there are is a vigorous debate about how much biomass for fuel the world can sustainably produce, market forces are already kicking in to dampen some of the wilder scenarios on both sides. Corn prices are already at 10 year highs, and palm oil futures, a major biodiesel feedstock, cost about US$535 a ton, up 30% from a year ago. Both are being driven by ramped up biofuel production.
- At the same oil prices are falling, meaning that biofuels production is looking less and less economically competitive. We have of course seen this before: falling oil prices in the 80's nearly killed alternative fuel production in the United States and it was only committed government support that kept it alive in Brazil.
- Sustained government and consumer support will no doubt be necessary to help keep the industry alive if these trends continue. But a little dampened exuberance is not necessarily a bad thing; if it gives us time to make sure that biofuel production is happening in a sustainable manner and to bring online second-generation technologies like cellulosic ethanol and biomass-to-liquids.
- Only time will tell if the current grand schemes for growing our way out of oil will turn out to be a solution or just more hot air.
24 January 2007
In his State of the Union address President Bush has called for reducing US gasoline consumption by 20% by 2010, the Twenty in Ten initiative. In addition to calling for greater domestic oil production and increased fuel efficiency standards for vehicles, he also called for a greatly expanded renewable fuel standard of 35 billion gallons of renewable and alternative fuels by 2017, which would displace 15% of US gasoline consumption. Details of how the government intends to implement this ambitious plan, have not yet been released but it is clear that such an ambitious target is not coming from corn ethanol. A few quick calculations reveals that the 35 billion gallon target would require 140% of 2006's corn crop and, depending on yields, between 39.6% and 65.2% (175 to 240 million acres) of all U.S. crop land. This doesn't even begin to deal with the soil erosion and nitrogen fertilizer runoff that any drastic ramp-up of corn will produce. So what are the other options? Second-generation biofuels including Cellulosic ethanol and biobutanol have been mentioned: but cellulosic is considered 5 years away from real commercialization, which leaves little time to ramp up production. Nor is it clear how and where feedstocks for cellulosic will be produced. Another possibility that has been floated is importing biofuels: but there is no mention of insuring that biofuels that are imported aren't produced in a way that is energy-positive or climate-emmissions neutral, meaning that we could just be concealing our dependency on oil rather than reducing it. The devil is in the details, and at this point Bush's proposal seems to create more questions and worries then it really answers.
23 January 2007
The big potential bioenergy story for today is what George Bush will say about possible biofuel targets in the State of the Union speech this week. There has been speculation that President Bush could call for over 60 billion gallons (227 billion litres) of ethanol to be mixed into US gasoline supplies each year by 2030. Now while ethanol in the United States is currently made almost entirely from corn, producing 60 billion gallons from corn is impossible. According to recent testimony by the Chief Economist for USDA, the US produced 5 billion gallons of ethanol this year, but it used 20% of the total US corn crop. Moreover, that only displaced 2% of gasoline by energy. Nor is a dramatic increase in corn production without costs, including more soil erosion, fertilizer pollution and loss of wildlife habitat, not to mention possible impacts on world food prices. So everyone agrees that to have a real impact, we have to develop cellulosic ethanol. The question is then: will President Bush give us some concrete suggestions for how we overcome the technical and economic hurdles to cellulosic or will it just be more corn?
16 January 2007
The major bioenergy story of 2007 is shaping up to be the impact of ethanol-driven corn prices on world food markets. The price of tortillas in Mexico has increased by 30%, although it is not clear that this is actually being affected by US corn prices, by speculation by monopoly producers in Mexico or some other factor. Whatever the truth may be, it is clear that the honeymoon period with corn ethanol is over, as more and more people are asking what the social and environmental implications are of an industry that already uses 20% of the US corn crop and is expanding rapidy. Other challenges of increasing corn ethanol production, such as the water resources required (see Water use in Ethanol plants) are encouraging the investigation of alternatives, including a NASA scientist who sees potential in growing halophytes (saltwater plants) in the desert, irrigated with saltwater, as biofuel feedstocks. What is clear is that only by carefully considering the full impact of biofuels can the best options be identified.
9 January 2007
A new report on the net energy of corn ethanol was released today that suggests that both sides are right. Apparently the net energy balance is so close that depending on variations both in numbers and in what variables are included, corn ethanol can either have a positive or negative net energy. Hopefully, this will help spur a more focused debate not just on whether biofuels are good or bad, but on exactly what we need to do to make sure that the transition to bioenergy is done in an economically, environmentally and socially sustainable manner.
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