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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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Monday, June 26, 2006

Crucial EU meeting determines fate of Doha Development Round, global biofuels trade

Earlier we reported on the effects on global biofuels trade of the failed WTO meeting that took place in Hong Kong last year. We noted that both farmers from the developing world as well as those in the U.S. and the E.U. are looking to biofuels as a way to break the deadlock.
Biofuels such as ethanol, biodiesel and solid biomass are part of WTO discussions about "environmental goods", but they also play a major role in the debate about agricultural subsidies and tariffs. Here at the Biopact we want the US and the EU to reduce their agro-subsidies and to open their markets to energy farmers from the South. That is why these WTO talks and the EU's position are so important.

The EU Commission is preparing itself for a crucial ministerial meeting that will decide the fate of the Doha Development Round, that has been lagging on for 4 years without any results. After only minor advances were made in Hong Kong in December 2005, time is beginning to run out for negotiators to reach a deal on the full modalities of the final agreement. In a speech made in London on Friday 23rd June 2006, Commissioner for Trade, Peter Mandelson reminded his public of what was at stake with the current negotiations, underlining the huge cost of a failure.

He urged all WTO members to make concessions in order for a final deal to be struck, stressing that a truly beneficial deal for developing countries will not be achieved by simply improving access to the EU’s agricultural market.

Looming deadline:

The timeline for reaching a final agreement is severely constrained because, under the US trade promotion act (TPA) of 2002 which expires mid 2007, Congress must either accept or refuse the end result of the negotiations. Past that date, Congress will resume its power to amend the agreement as much as it wants, severely diminishing chances of acceptation. In order for the text to be presented to Congress in time, a final text must be reached before the end of 2006, which means that full modalities for agricultural and industrial trade opening must be reached before the end of July, when the WTO closes for the summer break.

Agricultural and industrial market opening:

There is a common understanding that agreement must be reached on these points before other important issues, such as services liberalisation, trade facilitation and the revision of WTO rules on anti-dumping, can be tackled. The key players in the debate are the EU, US and the G20 group of developing countries. Their demands are interlinked and each player will have to make a step towards the other if an agreement is to be reached:

* Cuts on agricultural subsidies: The US will have to commit to further cuts in trade-distorting subsidies if it wishes to achieve an ambitious result to the discussions.
* Increase in agricultural market access: Both the US and the G20 are demanding that the EU increase its commitment to reducing agricultural tariffs. So far the EU has promised an average cut of 39%, bringing its average agricultural tariff down to 12%, but has signalled that it could move ‘significantly’ (although not the whole way) towards the G20’s request of an average cut of 54% if both the G20 and US improve their own offers in other areas.
* Reducing industrial tariffs: The EU and the US will not make any additional commitments as long as emerging developing countries, such as Brazil, India and China, do not commit to giving real access to their manufactures – and also to their services - markets. The Ministerial meeting on June 28th 2006 will mainly attempt to achieve a broad agreement on these issues.

Respecting the “Development agenda”:

Although the main debate has stalled on the issues of agricultural and industrial trade liberalisation, many studies point to the fact that the main gains for developing countries will be derived from services liberalisation and trade facilitation, which still need to be discussed.

Numerous studies have been presented in the last months, assessing the economic impact of the Doha Round. Although they are all based on the same methodology, their results vary enormously. This is due to different assumptions on how markets react and on what the final outcome of the Round will be.

The report from the Carnegie Institute finds that “any of the plausible trade scenarios will produce only modest gains”, increasing global GDP by less than 0,2%. It suggests that about 90% of the gains for developing countries would come from the liberalisation of trade in manufactured goods.

The World Bank study, on the other hand, argues that agricultural liberalisation (including domestic support and cuts in export subsidies) could provide over two thirds of the total income gains.

Two other studies, from CEPII (Paris leading institute in international economics) and the Swedish National Board of Trade give a more balanced view, showing that the majority of the gains could be generated by tariff cuts in industrial products (around 60%) but that agricultural opening will also be beneficial (around 40% of the gains).

The Commission presented an overview of these different studies and underlined the fact that all studies show that the economic benefits linked to services or trade facilitation are potentially the most important in the Round. Commissioner Mandelson also underlined that the largest benefits for developing countries are likely to come, not from market access, but from work on trade facilitation (the reduction of trading costs), which could more than double the overall economic gains.

More at Euractiv.

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Worlds apart: the petroleum era versus the biofuels era

Binary thinking is seldom any useful. Turning complex realities into simple categories and contrasting them with each other using pairs of oppositions, is called 'structuralism' - a much criticized way of looking at reality. But sometimes, the exercise can open our eyes.

We would like to present the following structural matrix of the concepts and practises that drive two different eras: the petroleum and the biofuels era. Since these 'energy complexes' are so crucial to our economies, they have political, social and environmental ramifications that influence our daily lives.
The conceptual matrix serves a programmatic function. We have the luxury of hindsight, of being able to look back at history. And what we saw during the petroleum era was not that pretty. Here at the Biopact, we think we might be entering a brighter, greener and more just era. And if reductionist representations of complex realities can help us entering that era, then why not use them.
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