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    Spanish company Ferry Group is to invest €42/US$55.2 million in a project for the production of biomass fuel pellets in Bulgaria. The 3-year project consists of establishing plantations of paulownia trees near the city of Tran. Paulownia is a fast-growing tree used for the commercial production of fuel pellets. Dnevnik - Feb. 20, 2007.

    Hungary's BHD Hõerõmû Zrt. is to build a 35 billion Forint (€138/US$182 million) commercial biomass-fired power plant with a maximum output of 49.9 MW in Szerencs (northeast Hungary). Portfolio.hu - Feb. 20, 2007.

    Tonight at 9pm, BBC Two will be showing a program on geo-engineering techniques to 'save' the planet from global warming. Five of the world's top scientists propose five radical scientific inventions which could stop climate change dead in its tracks. The ideas include: a giant sunshade in space to filter out the sun's rays and help cool us down; forests of artificial trees that would breath in carbon dioxide and stop the green house effect and a fleet futuristic yachts that will shoot salt water into the clouds thickening them and cooling the planet. BBC News - Feb. 19, 2007.

    Archer Daniels Midland, the largest U.S. ethanol producer, is planning to open a biodiesel plant in Indonesia with Wilmar International Ltd. this year and a wholly owned biodiesel plant in Brazil before July, the Wall Street Journal reported on Thursday. The Brazil plant is expected to be the nation's largest, the paper said. Worldwide, the company projects a fourfold rise in biodiesel production over the next five years. ADM was not immediately available to comment. Reuters - Feb. 16, 2007.

    Finnish engineering firm Pöyry Oyj has been awarded contracts by San Carlos Bioenergy Inc. to provide services for the first bioethanol plant in the Philippines. The aggregate contract value is EUR 10 million. The plant is to be build in the Province of San Carlos on the north-eastern tip of Negros Island. The plant is expected to deliver 120,000 liters/day of bioethanol and 4 MW of excess power to the grid. Kauppalehti Online - Feb. 15, 2007.

    In order to reduce fuel costs, a Mukono-based flower farm which exports to Europe, is building its own biodiesel plant, based on using Jatropha curcas seeds. It estimates the fuel will cut production costs by up to 20%. New Vision (Kampala, Uganda) - Feb. 12, 2007.

    The Tokyo Metropolitan Government has decided to use 10% biodiesel in its fleet of public buses. The world's largest city is served by the Toei Bus System, which is used by some 570,000 people daily. Digital World Tokyo - Feb. 12, 2007.

    Fearing lack of electricity supply in South Africa and a price tag on CO2, WSP Group SA is investing in a biomass power plant that will replace coal in the Letaba Citrus juicing plant which is located in Tzaneen. Mining Weekly - Feb. 8, 2007.

    In what it calls an important addition to its global R&D capabilities, Archer Daniels Midland (ADM) is to build a new bioenergy research center in Hamburg, Germany. World Grain - Feb. 5, 2007.

    EthaBlog's Henrique Oliveira interviews leading Brazilian biofuels consultant Marcelo Coelho who offers insights into the (foreign) investment dynamics in the sector, the history of Brazilian ethanol and the relationship between oil price trends and biofuels. EthaBlog - Feb. 2, 2007.

    The government of Taiwan has announced its renewable energy target: 12% of all energy should come from renewables by 2020. The plan is expected to revitalise Taiwan's agricultural sector and to boost its nascent biomass industry. China Post - Feb. 2, 2007.

    Production at Cantarell, the world's second biggest oil field, declined by 500,000 barrels or 25% last year. This virtual collapse is unfolding much faster than projections from Mexico's state-run oil giant Petroleos Mexicanos. Wall Street Journal - Jan. 30, 2007.

    Dubai-based and AIM listed Teejori Ltd. has entered into an agreement to invest €6 million to acquire a 16.7% interest in Bekon, which developed two proprietary technologies enabling dry-fermentation of biomass. Both technologies allow it to design, establish and operate biogas plants in a highly efficient way. Dry-Fermentation offers significant advantages to the existing widely used wet fermentation process of converting biomass to biogas. Ame Info - Jan. 22, 2007.

    Hindustan Petroleum Corporation Limited is to build a biofuel production plant in the tribal belt of Banswara, Rajasthan, India. The petroleum company has acquired 20,000 hectares of low value land in the district, which it plans to commit to growing jatropha and other biofuel crops. The company's chairman said HPCL was also looking for similar wasteland in the state of Chhattisgarh. Zee News - Jan. 15, 2007.

    The Zimbabwean national police begins planting jatropha for a pilot project that must result in a daily production of 1000 liters of biodiesel. The Herald (Harare), Via AllAfrica - Jan. 12, 2007.

    In order to meet its Kyoto obligations and to cut dependence on oil, Japan has started importing biofuels from Brazil and elsewhere. And even though the country has limited local bioenergy potential, its Agriculture Ministry will begin a search for natural resources, including farm products and their residues, that can be used to make biofuels in Japan. To this end, studies will be conducted at 900 locations nationwide over a three-year period. The Japan Times - Jan. 12, 2007.

    Chrysler's chief economist Van Jolissaint has launched an arrogant attack on "quasi-hysterical Europeans" and their attitudes to global warming, calling the Stern Review 'dubious'. The remarks illustrate the yawning gap between opinions on climate change among Europeans and Americans, but they also strengthen the view that announcements by US car makers and legislators about the development of green vehicles are nothing more than window dressing. Today, the EU announced its comprehensive energy policy for the 21st century, with climate change at the center of it. BBC News - Jan. 10, 2007.

    The new Canadian government is investing $840,000 into BioMatera Inc. a biotech company that develops industrial biopolymers (such as PHA) that have wide-scale applications in the plastics, farmaceutical and cosmetics industries. Plant-based biopolymers such as PHA are biodegradable and renewable. Government of Canada - Jan. 9, 2007.

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Tuesday, November 14, 2006

Global forest cover increasing; poverty main cause of deforestation - study

In a major study, scientists have found that global forest cover is increasing, contrary to what many people think. They also confirm convincingly that poverty is the main cause of deforestation and that increasing prosperity results in a net gain in tree cover. This is important news for Biopact, as it tells us that the development of a biofuels and bioenergy industry in the South can be a unique strategy for both fighting poverty and deforestation in the developing world (see below).

A new technique for measuring the state of the world's forests shows the future may not be as bad as previously feared. An international team of researchers, led by Helsinki University's professor Pekka Kaupi, say its Forest Identity study suggests the world could be approaching a "turning point" from deforestation.

The study measures timber volumes, biomass and captured carbon - not just land areas covered by trees. The findings are being published in the US journal Proceedings of the National Academy of Sciences as an open access article (abstract and full article *.pdf).
Previously, the focus was almost exclusively on the size of a forest area. Now, we have included other components, including biomass and the amount of carbon stored. The trend is better than previously thought. We see prospects for an end to deforestation; we do not make a forecast but it is possible. - Professor Kauppi, from the University of Helsinki.
Kaupi says data from the Forest Identity methodology offered a more sophisticated view than previous studies. He said this approach offered a better understanding of the natural resource: "When we look at changes in both area covered and biomass, we can get a more complete picture of the ecosystems." When the technique was applied to data from the UN Food and Agriculture Organisation's (FAO) Global Forest Resources Assessment report, the researchers found that forest stocks had actually expanded over the past 15 years in 22 of the world's 50 most forested nations. They also showed increases in biomass and carbon storage capacity in about half of the 50 countries.

Deforestation strongly correlated to poverty
The data also show that reforestation and deforestation are strongly correlated to prosperity and poverty. Active reforestation efforts started in Europe nearly 100 years ago already. Europe could regenerate its forests, because its agricultural productivity had increased considerably. Economic prosperity led Europe to invest in intensifications in agriculture; high yields and high land producitivity were the result, ultimately leading to much lower pressures on forests. Good agricultural techniques and high productivity meant that less forests had to be converted into farmland. Ultimately, so much prosperity was generated, that active reforestation efforts could begin to be implemented. In China and the US, similar developments and efforts came about much later, but these countries' forest cover has been growing steadily too for several decades.

Not surprisingly, the study reveals that forest area and biomass are still in decline in Brazil and Indonesia, home to some of the world's most important rainforests. The report shows a correlation between a nation's economic growth and "forest transition", in other words, a shift from deforestation to net gains in tree cover. The researchers found that when Gross Domestic Product (GDP) per capita reached $4,600 (£2,400), many nations experienced forest transition and saw an increase in forestry growing stock (volume of useable timber). Professor Kauppi says no nation intentionally destroyed forests, people did it out of necessity:

:: :: :: :: :: :: :: :: ::

"Rural populations, which are poor and growing, have to convert new land to agriculture and subsistence farming," he observed. "So the pressures on the forests ease if people have other job sources. We are not saying that people, because they are wealthier, do not destroy forests but it is a sign that societies have good law enforcement and rural policies."

But there was a risk that a misleading picture was being created by rich nations importing raw timber or wood-based products from poorer nations, rather than destroying their own woodlands. "This is a serious problem," Professor Kauppi said. "It is called 'leakage' or 'exporting ecological impacts' and it exists, unfortunately." But he emphasised that, overall, international trade was not bad: "If agricultural production takes place in highly productive regions, then land elsewhere can be protected or saved."

He hoped the Forest Identity formula would be used as a tool to help governments and policymakers to formulate effective strategies. "For example, you can set goals by analysing the changes in forest area and forest density and then make projections of alternative futures. "You cannot change things overnight. Making promises and goals that are unrealistic is bad; you have to set demanding, yet achievable aims."

Professor Kauppi said he was hopeful for the long-term future of the planet's forests, but warned that appropriate action was essential. "Critically, it is about how people live in rural areas in developing nations," he concluded. "Can their living conditions be improved? If they can, then there is reason to be optimistic."

What this means for biofuels and bioenergy
The study strengthens the case for the development of a biofuels and bioenergy industry in the poorest countries of the Global South, we think. (Let us take an intuitive approach here; the case should be studied more thoroughly by economists and researchers in development economics).

Providing jobs to the rural poor and raising the incomes of subsistence farmers is the priority in efforts to stop deforestation. A well developed biofuels industry is probably the single best opportunity to achieve these aims. As we have showed many times, biofuels production brings jobs to the rural poor.

More importantly, though, in order to increase prosperity in a country, the economic basics, the material infrastructure, has to be favorable. There is a large body of economic evidence which suggests that cheap and abundantly available energy is a sine qua non for economic development.
It is one of the single most important factors for growth. The West has been able to build its entire "modernity" (which equates in this case with an end to deforestation, evidenced by Europe) on the availabilty of cheap petroleum.

Now rising energy prices are a great threat to the economic development of countries in the South. With the ere of cheap oil gone, the risk exists that the global South will no longer develop as fast as would have been possible during the petroleum era. If economic growth slows down and poverty levels increase, forests are the first victims (this is a well-established fact, reconfirmed by the new study). Moreover, development economics have convincingly shown that economic decline or stagnation results in increased population growth rates; that is: the poorer the country, the higher the fertility rate, the more children a women get. More people means more mouths to feed (which equates to more land needed to grow crops) and more biomass needed for energy (in the South this means: more fuelwood, and deforestation). A negative spiral of poverty sets in.

Moreover, poverty greatly affects agricultural productivity. The poorer a country, the lower its land productivity, the greater the pressures on forests.

Economic growth reverses all of these trends. Economic prosperity brings demographic changes that are crucial to the sustainability of our planet: the wealthier a country, the lower its population growth rates. The lower population growth, the lower the pressures on the environment. More prosperity allows investments in intensifications and productivity increases in agriculture. This in turn means less forest has to be converted into farmland. Ultimately this chain of consequences generates a level of prosperity that sets in motion the transition away from deforestation to reforestation.

In this sense, the development of a modern biofuels and bioenergy industry offers a way out for the countries who face rising energy prices and the threats to their economic development which result from this. With biofuels, they can reduce their dependence on costly oil (which prevents economic growth). Many of the poorest countries can even become bioenergy exporters, supplying feedstocks to an international market where prices for the commidity are increasing rapidly.

The income this industry potentially generates -- both on the level of States as well as on the level of individual rural households -- increases chance for economic growth and so ultimately decreases the pressures on fragile ecosystems like rainforests. Put differently, if developing countries do not find a way out of their dependence on ever more expensive energy, their forest ecosystems stand to suffer much more in the future.

No doubt, this is a very complex issue, and our simplistic sketch above will have to be nuanced. But we think there is a growing body of evidence which hints at the fact that the development of a biofuels industry might well be a precondition for efforts to increase the level of prosperity in the Global South. It may ultimately reduce deforestation rates in that part of the world.


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