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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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Saturday, September 30, 2006

WWF: Brazil's biofuel plan is unsustainable

Brazil's president Lula recently wrote a short essay summing up the benefits of biofuels for his country (earlier post). He spoke of a new development paradigm, based on biofuels production, which not only brings energy security and environmental benefits, but social development to the many rural poor as well. Through biodiesel and ethanol, the state reduces its fossil fuel import bills (money which can be spent on poverty eradication and reducing social inequalities) and recognizes the productive capacities of the poor instead of viewing them as mere recipients of aid. Lula added that such a paradigm can be applied elsewhere in the South, notably in Africa.

Giulio Volpi of WWF-Brazil later responded to the President's vision and partly disagrees. He says the Brazilian government is promoting the use of biodiesel produced from soya beans to reduce its dependence on fossil fuels, by clearing large areas of Amazonian rainforest to grow soybeans. This is too high an environmental price for this policy to be sustainable.

Volpi: Brazil's President Lula rightly recognises that one of the greatest challenges of the 21st century is reducing our dependence on climate-polluting fossil fuels, such as coal and oil. Currently Brazil's per capita greenhouse gas emissions are less than half the world's average, but this is largely due to its historic focus on energy efficiency, hydropower and sugar-based ethanol.

While President Lula said that Brazil has responded to the future energy challenge by "using clean, renewable, alternative energy sources to an ever-greater extent", Brazil seems to favour increasing fossil-fuel power generation. For example, coal, diesel oil and natural gas-fired thermoelectric plants will supply about two-thirds of the 3,200 megawatts of new electric power which was put out to bidders by the Brazilian government last December. Once built, these plants will emit over 11 million tonnes of CO2 per year - an 11% growth, which is not only bad for the global climate but also for the national economy.

Research shows that if Brazil was to implement an aggressive energy efficiency policy it could reduce the growth in power demand by as much as 40%, achieve energy savings of more than US$37bn per year, and stabilise its power-sector related CO2 emissions by 2020. This may seem radical, but in 2001, under the threat of power blackouts, Brazilians slashed electricity demand by 20% in a couple of months, without reducing their quality of life:
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President Lula said biofuel "is significantly less polluting than conventional petroleum-based diesel". But Brazil is set to produce most of its biodiesel from soya beans, which have virtually no advantage over conventional fuels in terms of overall greenhouse gas emissions, let alone the millions of hectares of tropical forest that have been cleared for large-scale soya plantations.

Automatically classifying biofuels as renewable energy regardless of how they are produced is dangerous. We cannot afford to address climate change while creating another environmental problem, deforestation - itself the source of 80% of carbon emissions in Brazil. The world must promote only those biofuels which offer the greatest environmental benefit, such as sustainably produced forest and wood products in temperate countries, and sugar-based bioethanol in tropical ones.

A mandatory eco-certification scheme for biofuels must be established, applying to all biofuels regardless of where they are produced. This system must be based on environmental and social criteria, and be easy to apply and flexible enough to meet local conditions.

Lula says that through investment in ethanol and biodiesel, Brazil is determined to "plant the oil of the future". But for biofuels to play a key role in a new carbon-free energy future, policy makers - both in the North and South - must ensure that biofuels are produced in an environmentally and socially friendly way. In Portuguese we have an expression which sums this up: Biocombustíveis sim, mas não de qualquer jeito! This means: yes to development but not to any development, yes to biofuels but not to any biofuels!

The Guardian: Soya is not the solution to climate change

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Global biodiesel report identifies industry trends

A Houston based energy intelligence and mana- gement consulting firm has published its 380-page Biodiesel 2020: A Global Market Survey [prospectus: *pdf format, flashpaper format]. The study looks at biodiesel production trends in the EU, the US, Brazil, India and China.

"The global market for biodiesel is poised for explosive growth in the next ten years. Although Europe currently represents 90% of global biodiesel consumption and production, the U.S. is now ramping up production at a faster rate than Europe, and Brazil is expected to surpass U.S. and European biodiesel production by the year 2015," says William Thurmond, the author of the market study and Director of Management Consulting at Emerging Markets Online.

It is possible that Biodiesel could represent as much as 20% of all on-road diesel used in Brazil, Europe, China and India by the year 2020. If governments continue to aggressively pursue targets; enact investor-friendly tax incentives for production and blending; and help to promote research & development in new biodiesel feedstocks such as algae biodiesel, the prospects for biodiesel may become realized faster than anticipated. Biodiesel 2020 finds that each of these variables will be essential to the eventual success of these targets" author William Thurmond notes.

In the USA, the market for biodiesel is growing at an alarming rate. Biodiesel consumption in the U.S. grew from 25 million gallons per year in 2004 to 78 million gallons in 2005. Biodiesel production in the U.S. is expected to reach 300 million gallons by the end of 2006, and to reach approximately 750 million gallons per year in 2007:

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Demand for biodiesel in the U.S. has grown so fast in the first half of 2006 that the sixty five or so existing major biodiesel plants are barely able to keep up. To meet this demand, over fifty new, larger-scale plants are in construction and are expected to come online between late 2006 and 2008. Not only will these fifty plants more than double the U.S. production capacity, but the size and production volumes of the new plants are much bigger on average.

The new study Biodiesel 2020 observes geographic shifts in biodiesel production plants, distribution facilities and downstream locations into new areas and coastal regions. The biodiesel market in the U.S. has a significant amount of room to grow to reach the status of its European counterparts. In Europe, biodiesel represents 2% of total on-road transportation fuel consumption and is expected to reach 6% by 2010. The total biodiesel being sold in the U.S. amounts to less than 1/2 of 1% of all petro-diesel on-road consumption in 2005.

In this regard, there are promising growth indicators for the future of the U.S. biodiesel markets. The number of retail outlets for biodiesel in the U.S. grew more than three fold from 300 in 2005 to over 950 retail sites so far in 2006. Another growth push in the U.S. biodiesel industry is coming from all-star promotional campaign including Willie Nelson and Barry Switzer (both investors and executives in biodiesel companies) as well as Julia Roberts, Daryl Hannah, Luke Perry and Neil Young. U.S. politicians, prompted by concerns for energy security and environmental issues, are also making news promoting biodiesel as a vital renewable energy source.

In other parts of the world, biodiesel is becoming increasingly important as governments react to growing petroleum import dependency and enact new alternative fuels policies and targets. Economic and environmental security concerns are giving birth to new government targets and incentives in China, India, Brazil and Europe, aimed at reducing petroleum imports and increasing the consumption and production of alternative and renewable fuels.

Biodiesel is a natural fit in places like Europe, China, India and Brazil where diesel fuel is more commonly used in than it is in the U.S.

In these markets, the prospects for biodiesel as a replacement for diesel are not only bigger in terms of total market share, but also in terms of conversion rates among existing drivers.

Biodiesel 2020: A Global Market Survey tracks the U.S. and global markets for biodiesel growth, and provides 5 to 10 year forecasts for biodiesel demand, consumption and production. Brazil and Europe are illustrated as "case studies" for strong biofuels growth with advanced biofuels infrastructure, installed plant capacity, and mature market economics.

With an eye on the future, Biodiesel 2020: A Global Market Survey provides forecasts and scenarios to the year 2020 for the U.S. and European markets as well as the "big emerging markets" of China, Brazil and India.

For Brazil, China and India, the study includes long-term forecasts and year 2020 scenarios, each measuring growth in the diesel and biodiesel markets, as well as focusing on the potential for biodiesel growth.

For each of the global markets, this study has developed proprietary forecasts as a baseline to produce 2020 "Scenarios" for the U.S., Europe, China, India and Brazil.

The initial results from the study Biodiesel 2020: A Global Market Survey find that new developers, farmers, feedstock providers, producers, and investors who can meet growing demands for supply are expected to benefit from this emerging market. In addition, this study finds key advantages in the future will be available to producers and investors to supply future needs with new and improved technologies; alternative feed stocks with higher yields such as palm oil and algae biodiesel; production scalability and flexibility options; supply chain, distribution and co-location strategies; innovative risk management strategies; and industry-friendly government targets and tax incentives committed to promoting the awareness and growth of the industry.

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