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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, February 06, 2007

Chile's biofuels discussions show diversity of stakeholders' perspectives

The Inter Press Service (IPS) has an interesting overview of the complexity of Chile's ongoing biofuels discussions. With a view on studying the matter in-depth, the Chilean government created an interministerial commission and a mixed public-private advisory commission made up of representatives of public agencies and business, academics, farmers and environmentalists. The results of these commissions provide a glimpse of the different perspectives on domestically produced biofuels, held by a wide range of stakeholders. A summary.

The perspective of the state: energy security, independence
The government of left-leaning President Michelle Bachelet is determined to develop the biofuels industry in order to diversify Chile's energy sources. In July 2006, the Chilean government announced plans to boost national biofuels production to increase the country's energy independence. At present Chile imports 72 percent of its fuel as oil, gas and coal.

With such heavy dependence on foreign energy, Argentina's decision to implement cuts in its natural gas exports to Chile, starting in 2004, and to raise the price of the fuel, was a decisive factor in seeking alternative energy sources.

On Jan. 19, the advisory commission released a report containing a large number of recommendations, including two basic requirements for the viability of the industry: exemption of biofuels from specific taxes, and making their use obligatory to ensure demand. The advisory commission's report is being studied by President Bachelet, who will decide the next step, according to Agriculture Minister Álvaro Rojas.

According to the government's preliminary estimates, there are 170,000 hectares in Chile that could be farmed to produce the raw materials for biodiesel and ethanol.

Agriculture Minister Rojas did already announce that by 2010, vehicles will most probably be using biofuels to some extent. His aim was to develop the capacity for bioenergy to supply five percent of Chile's total energy consumption by then. The market itself would decide whether biodiesel or ethanol was best, he added.

The report recommends that diesel of fossil origin be mixed initially with two percent biodiesel, which could then be increased by increments of 1.5 percent. According to estimates by the government's National Energy Council, consumption of petrol and diesel in 2010 will stand at 3.3 and 7.6 million cubic metres, respectively.

Imports from tropical countries
For many countries, especially those with temperate climates (like Chile), it may be more cost-effective to continue to use fossil fuels, or to import biofuels from countries that are able to produce them more competitively, such as Brazil, Argentina, Bolivia or Peru the document said:
:: :: :: :: :: :: :: :: :: ::

Political opposition: against mandates
Jorge Rodríguez Grossi, member of the opposition and former economy and energy minister in the Ricardo Lagos administration (2000-2006), criticised the proposal to enforce consumption of biodiesel and ethanol.

Grossi told the on-line newspaper El Mostrador that he was against any coercion, as a matter of principle, and was not in favour of including biofuels in the energy base on that condition. He would only be in favour if it became economical to do so, he said.

Environmentalist NGO perspective: sustainability
The non-governmental Sustainable Societies Foundation (FSS) and the United Peasant and Ethnic People's Movement of Chile (MUCECH), both members of the advisory commission, believe that the programme will start with rapeseed biodiesel, and in the medium term will switch to lignocellulose materials (such as agricultural waste and wood).

"All the participants on the public-private commission agreed with biofuel development," but with their respective caveats, FSS head María Isabel Manzur told IPS. She was categorical in stating that the FSS would only support national biodiesel or ethanol production if it were carried out sustainably.

"We believe biofuels should not threaten food production in this country. We are also concerned about plantation forestry and crops replacing native forest, and about excessive concentration of land ownership and displacement of rural workers. In addition, overuse of water resources must be prevented, and it is essential that biofuel production be for domestic consumption and not for export," the environmental activist said.

Environmentalists fear that farmers will give up growing food and turn their fields into monoculture plantations for the biofuels industry, which is why they insist that ethanol and biodiesel production should be solely for national consumption and not for export.

According to Manzur, large companies must be prevented from buying up excessively large tracts of land to jump on the biofuel bandwagon, in order to protect small farmers. The availability of water for new areas to be cultivated must also be examined, FSS said.

The government had carried out several feasibility studies on producing ethanol from wheat, oats, maize, potato and beetroot, and biodiesel from native oil-producing plants like sunflower and rapeseed, and animal fats. It has also considered using native wood, which is underutilised, for bioenergy purposes.

Another of FSS's concerns involves the technological aspects associated with biofuels. It is particularly worried about the pressure some producer sectors are exerting to introduce transgenic species, modified by the introduction of genes from other plant or animal species, as raw materials.

However, the report clearly stated that given that Chile does not have national guidelines authorising the use of transgenic crops for domestic commercial purposes, it would be inappropriate to create them for the special case of biofuels. Transgenics should be treated as a separate issue, by other experts, it said.

Farmers associations: biofuels offer opportunity for smallholders
The national director of MUCECH, Omar Jofré, told IPS he was "hopeful" about the prospects for small rural producers who join the biofuel industry. Jofré pointed out that 85 percent of the country's farms are small family farms. A total of 278,000 families -- 1.2 million people - make a living in the small farming sector, he said.

"If we take part in this business, we believe that small farmers' incomes will increase, our quality of life will improve, we will have access to technology, and there will be more development in the regions," Jofré said.

But this is contingent on "guaranteeing inclusive participation of all those involved: producers, processers, sales agents and consumers," he said.

The report reflects the view of MUCECH and other groups that incentives and subsidies are essential to producing biofuels in Chile, as has been the case in countries like Brazil.

The report said that, with present levels of taxation and costs of raw materials, biodiesel would be competitive with diesel if the price of crude were about 72 dollars a barrel, assuming that biodiesel were not subject to specific taxes.

Remaining uncertainties
In regard to pollution, for example, the government's National Commission on the Environment (CONAMA) is still working on a study investigating whether biofuels will effectively alleviate the serious problem of air pollution in the capital.


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