UN publishes its long-awaited report on bioenergy - opportunities and risks

The worldwide transition to biofuels and bioenergy offers many opportunities, but also involves a number of trade-offs and risks, the United Nations says in its long-awaited and most comprehensive review of the likely impacts of the emerging bioenergy market, which was released today.

The document entitled “Sustainable Energy: A Framework for Decision Makers” was prepared by UN-Energy, a group of all UN agencies, programmes and organizations working in the area of energy. It was sponsored by the Rome-based UN Food and Agriculture Organization (FAO) (earlier post). The UN report highlights many of the points elaborated here at the Biopact and refers to some of our analyses.

In general, the study acknowledges that biofuels can go many ways and that outcomes depend on local circumstances: if produced uncarefully, they can threaten the environment, biodiversity and the food security of people, but if projects are implemented wisely, they offer major opportunities to fight poverty and climate change, and to boost the incomes and food security of millions of subsistence farmers in the South.

Catastrophic effect of high oil prices on poor countries
The report is unambiguous about the dramatic effects of high oil prices on the development of poor economies, saying "Recent oil price increases have had devastating effects on many of the world's poor countries, some of which now spend as much as six times as much on fuel as they do on health. Others spend twice the money on fuel as they do on poverty alleviation. And in still others, the foreign exchange drain from higher oil prices is five times the gain from recent debt relief."

At a time when energy analysts predict a period of unpredictable oil markets, with prices dependent on developments in some of the world's least stable regions, fossil fuel dependence has become a major risk for many developing nations. Biofuels may come to the rescue, since "in such national settings, the macroeconomic benefits of channeling fuel revenues into poor, rural economies could be substantial."

The report is optimistic about the technical potential for liquid biofuels: "The gradual move away from oil has begun. Over the next 15 to 20 years, we may see biofuels providing a full 25 percent of the world's energy needs".

Growing opportunities
The analysis notes that the market for biofuel feedstocks offers new and rapidly growing opportunities for agricultural producers. “Modern bioenergy could make energy services more widely and cheaply available in remote rural areas, supporting productivity growth in agriculture and other sectors with positive implications for food availability and access”.

Modern bioenergy can also help to meet the needs of the 1.6 billion people worldwide who lack access to electricity in their homes, and the 2.4 billion who rely on straw, dung and other traditional biomass fuels to meet their energy requirements. Overall, in taking decisions, policy makers “should ensure that food security considerations are given priority,” the report stresses.

Bringing down trade barriers
The document is critical of tariff barriers currently erected against ethanol imports by some countries. Impeding imports of more efficiently produced biofuels from abroad, such as sugarcane based ethanol and palm oil based biodiesel, while simultaneously mandating the blending of biofuel with fossil fuels at home could divert more land than necessary from food production, it said:
biofuels :: energy :: sustainability :: climate change :: ethanol :: biodiesel :: biomass :: energy security :: food security :: poverty alleviation :: bioenergy ::


Involving farmers and mixed production
As to the implications for agriculture in general, the report notes that "at their best, liquid biofuel products can enrich farmers by helping to add value to their products. But at their worst, biofuel programmes can result in concentration of ownership that could drive the world’s poorest farmers off their land and into deeper poverty."

Most likely, "the biofuel economy of the future will be characterized by a mix of production types, some dominated by large, capital-intensive businesses, some marked by farmer co-ops that compete with large companies ... and some where liquid biofuels are produced on a smaller scale and used locally." "Regardless of the scale of production, however, one thing is clear: the more involved farmers are in the production, processing and use of biofuels, the more likely they are to share in the benefits."

Kitchen killer
On health, UN-Energy says that modern bioenergy held out the promise of dramatically reducing the death toll caused in developing countries by the “kitchen killer” – smoke inhalation from cooking with fuelwood or traditional biomass, which is responsible for more fatalities each year than malaria (earlier post). Women could also be freed from the drudgery of collecting firewood, thus providing them with greater opportunities for education and employment.

Assessing impacts
“The economic, environmental and social impacts of bioenergy development must be assessed carefully before deciding if and how rapidly to develop the industry and what technologies, policies and investment strategies to pursue,” the report says.

Purpose of the study is to help ensure that “the energy needs of people are met and the local and global environment is adequately protected,” said UN-Energy Chair Mats Karlsson of the World Bank. “We hope to use the collective strength of the UN system to affect change”.

Key policy issues
The report points out the many benefits of bioenergy systems in relation to poverty alleviation, access to energy services, rural development and rural infrastructure. It reviews the likely impact of bioenergy in terms of food security, climate change, biodiversity and natural resources, employment and trade. It also identifieds the vital points decision makers need to consider and stresses that, “unless new policies are enacted to protect threatened lands, secure socially acceptable land use, and steer bioenergy development in a sustainable direction overall, the environmental and social damage could in some cases outweigh the benefits”.

In an apparent reference to the use of some grains as a biofuel feedstock, UN-Energy noted, "in general, crops that require high fossil energy inputs (such as conventional fertilizer) and valuable (farm) land, and that have relatively low energy yields per hectare, should be avoided." This means most biofuels made in the US and Europe are not deemed to be viable.

Sustainable bioenergy use
Moreover, even “sustainably"-produced energy crops could have negative impacts if they replaced primary forests, “resulting in large releases of carbon from the soil and forest biomass that negate any benefits from biofuels for decades,” the report said.

To minimize greenhouse gas emissions associated with bioenergy production, policy makers needed to safeguard virgin grasslands, primary forests and other lands with high nature value, UN-Energy recommended. Governments should also encourage the use of sustainable bioenergy production and management practices. An international certification scheme, including greenhouse gas verification, should be set up to ensure that bioenergy products, and biofuels in particular, meet environmental standards all the way from fields to fuel tanks.

On food security, the report said that the availability of adequate food supplies could be threatened by biofuel production as land, water and other resources were diverted from food production. Similarly, food access could be compromised by higher basic food prices resulting from increased bioenergy feedstock demand, thus driving the poor and food insecure into even greater poverty.

We will be analysing the report more in-depth soon and report further on some of its findings and recommendations.

More information:
UN Energy: Sustainable Bioenergy: A Framework for Decision Makers - May 8, 2007.

FAO: UN weighs impact of bioenergy - Comprehensive report offers policy framework for decision makers - May, 8, 2007.

FAO: FAO sees major shift to bioenergy - April 25, 2006

FAO: Bioenergy, key to the fight against hunger - April 14, 2005.