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    AthenaWeb, the EU's science media portal, is online with new functionalities and expanded video libraries. Check it out for video summaries of the latest European research activities in the fields of energy, the environment, renewables, biotech and much more. AthenaWeb - July 04, 2007.

    Biopact was invited to attend a European Union high-level meeting on international biofuels trade, to take place on Thursday and Friday in Brussels. Leaders from China, India, Africa and Brazil will discuss the opportunities and challenges arising in the emerging global biofuels sector. EU Commissioners for external relations, trade, energy, development & humanitarian aid as well as the directors of international organisations like the IEA, the FAO and the IFPRI will be present. Civil society and environmental NGOs complete the panorama of participants. Check back for exclusive stories from Friday onwards. Biopact - July 04, 2007.

    China's state-owned grain group COFCO says Beijing has stopped approving new fuel ethanol projects regardless of the raw materials, which has put a brake on its plan to build a sweet potato-based plant in Hebei. The Standard (Hong Kong) - July 03, 2007.

    Blue Diamond Ventures and the University of Texas A&M have formed a biofuels research alliance. The University will assist Blue Diamond with the production and conversion of non-food crops for manufacturing second-generation biofuels. MarketWire - July 03, 2007.

    African Union leaders are to discuss the idea of a single pan-African government, on the second day of their summit in Accra, Ghana. Libya's Colonel Muammar Gaddafi is championing the idea, but many African leaders are wary of the proposal. BBC - July 02, 2007.

    Triple Point Technology, a supplier of cross-industry software platforms for the supply, trading, marketing and movement of commodities, announced today the release and general availability of Commodity XL for Biofuels™. The software platform is engineered to address the rapidly escalating global market for renewable energy fuels and their feedstocks. Business Wire - July 02, 2007.

    Latin America's largest construction and engineering firm, Constructora Norberto Odebrecht SA, announced plans to invest some US$2.6 billion (€1.9 billion) to get into Brazil's booming ethanol business. It aims to reach a crushing capacity of 30 million to 40 million metric tons (33 million to 44 million tons) of cane per harvest over the next eight years. More soon. International Herald Tribune - June 30, 2007.

    QuestAir Technologies announces it has received an order valued at US$2.85 million for an M-3100 system to upgrade biogas created from organic waste to pipeline quality methane. QuestAir's multi-unit M-3100 system was purchased by Phase 3 Developments & Investments, LLC of Ohio, a developer of renewable energy projects in the agricultural sector. The plant is expected to be fully operational in the spring of 2008. Market Wire - June 30, 2007.

    Siemens Energy & Automation, Inc. and the U.S. National Corn-to-Ethanol Research Center (NCERC) today announced a partnership to speed the growth of alternative fuel technology. The 10-year agreement between the center and Siemens represents transfers of equipment, software and on-site simulation training. The NCERC facilitates the commercialization of new technologies for producing ethanol more effectively and plays a key role in the Bio-Fuels Industry for Workforce Training to assist in the growing need for qualified personnel to operate and manage bio-fuel refineries across the country. Business Wire - June 29, 2007.

    A paper published in the latest issue of the Journal of the American Ceramic Society proposes a new method of producing hydrogen for portable fuel cells that can work steadily for 10-20 times the length of equivalently sized Lithium-ion batteries. Zhen-Yan Deng, lead author, found that modified aluminum powder can be used to react with water to produce hydrogen at room temperature and under normal atmospheric pressure. The result is a cost-efficient method for powering fuel cells that can be used in portable applications and hybrid vehicles. More soon. Blackwell Publishing - June 29, 2007.

    An NGO called Grains publishes a report that highlights some of the potentially negative effects associated with the global biofuels sector. The findings are a bit one-sided because based uniquely on negative news stories. Moreover, the report does not show much of a long-term vision on the world's energy crisis, climate change, North-South relations, and the unique role biofuels can play in addressing these issues. Grain - June 29, 2007.

    Researchers at the Universidad de Tarapacá in Arica plan to grow Jatropha curcas in the arid north of Chile. The trial in the desert, is carried out to test the drought-tolerance of the biodiesel crop, and to see whether it can utilize the desert's scarce water resources which contain high amounts of salt minerals and boron, lethal to other crops. Santiago Times - June 28, 2007.

    India and Thailand sign a Memorandum of Understanding (MoU) that envisages cooperation through joint research and development and exchange of information in areas of renewable sources of energy like, biogas, solar-thermal, small hydro, wind and biomass energy. Daily India - June 28, 2007.

    Portucel - Empresa Produtora de Pasta e Papel SA said it plans to install biomass plants with an expected production capacity of 200,000 megawatt hours per year at its paper factories in Setubal and Cacia. The European Commission gave the green light for state aid totaling €46.5 million, contributing to Portucel's plans to extend and modernise its plants. Forbes - June 28, 2007.

    Petro-Canada and GreenField Ethanol have inked a long-term deal that makes Petro-Canada the exclusive purchaser of all ethanol produced at GreenField Ethanol's new facility in Varennes, Quebec. The ethanol will be blended with gasoline destined for Petro-Canada retail sites in the Greater Montreal Area. Petro-Canada - June 27, 2007.

    According to a study by the Korean Energy Economics Institute, biodiesel produced in Korea will become cheaper than light crude oil from 2011 onwards (678 won/liter versus 717.2 won/liter). The study "Prospects on the Economic Feasibility of Biodiesel and Improving the Support System", advises to keep biodiesel tax-free until 2010, after which it can compete with oil. Dong-A Ilbo - June 27, 2007.

    Kreido Biofuels announced today that it has entered into a marketing and distribution agreement with Eco-Energy, an energy and chemical marketing and trading company. Eco-Energy will purchase Kreido Biofuels’ biodiesel output from Wilmington, North Carolina, and Argo, Illinois, for a minimum of 3 years at current commercial market prices, as well as provide Kreido transportation and logistics services. Business Wire - June 27, 2007.

    Beijing Tiandi Riyue Biomass Technology Corp. Ltd. has started construction on its new fuel ethanol project in the county of Naiman in Inner Mongolia Autonomous Region's Chifeng City, the company's president told Interfax today. Interfax China - June 26, 2007.

    W2 Energy Inc. announces it will begin development of biobutanol from biomass. The biofuel will be manufactured from syngas derived from non-food biomass and waste products using the company's plasma reactor system. Market Wire - June 26, 2007.

    Finland based Metso Corporation, a global engineering firm has received an order worth €60 million to supply two biomass-fired power boilers to Portugal's EDP Producao - Bioeléctrica, S.A. The first boiler (83 MWth) will be installed at Celbi’s Figueira da Foz pulp mill and the second boiler (35 MWth) at Caima’s pulp mill near the city of Constância. Both power plants will mainly use biomass, like eucalyptus bark and forest residues, as fuel to produce together approximately 40 MWe electricity to the national grid. Both boilers utilize bubbling fluidized bed technology. Metso Corporation - June 26, 2007.

    Canada's New Government is investing more than $416,000 in three southern Alberta projects to help the emerging biofuels industry. The communities of Lethbridge, Drumheller and Coalhurst will benefit from the projects. Through the Biofuels Opportunities for Producers Initiative (BOPI), the three firms will receive funding to prepare feasibility studies and business plans to study the suitability of biofuels production according to location and needs in the industry. MarketWire - June 26, 2007.

    U.S. Energy Secretary Samuel Bodman is expected to announce today that Michigan State and other universities have been selected to share $375 million in federal funding to develop new bioenergy centers for research on cellulosic ethanol and biomass plants. More info soon. Detroit Free Press - June 26, 2007.

    A Kerala based NGO has won an Ashden Award for installing biogas plants in the state to convert organic waste into a clean and renewable source of energy at the household level. Former US vice president Al Gore gave away the award - cash prize of 30,000 pounds - to Biotech chief A. Saji at a ceremony in London on Friday. New Kerala - June 25, 2007.

    AltraBiofuels, a California-based producer of renewable biofuels, announced that it has secured an additional US$165.5 million of debt financing for the construction and completion of two plants located in Coshocton, Ohio and Cloverdale, Indiana. The Coshocton plant's capacity is anticipated to reach 60million gallons/year while the Cloverdale plant is expected to reach 100 million gallons/year. Business Wire - June 23, 2007.

    Brazil and the Dominican Republic have inked a biofuel cooperation agreement aimed at alleviating poverty and creating economic opportunity. The agreement initially focuses on the production of biodiesel in the Dominican Republic. Dominican Today - June 21, 2007.

    Malaysian company Ecofuture Bhd makes renewable products from palm oil residues such as empty fruit bunches and fibers (more here). It expects the revenue contribution of these products to grow by 10% this year, due to growing overseas demand, says executive chairman Jang Lim Kuang. 95% of the group's export earnings come from these products which include natural oil palm fibre strands and biodegradable mulching and soil erosion geotextile mats. Bernama - June 20, 2007.

    Argent Energy, a British producer of waste-oil based biodiesel, announced its intention to seek a listing on London's AIM via a placing of new and existing ordinary shares with institutional investors. Argent plans to use the proceeds to construct the first phase of its proposed 150,000 tonnes (170 million litres) plant at Ellesmere Port, near Chester, and to develop further plans for a 75,000 tonnes (85 million litres) plant in New Zealand. Argent Energy - June 20, 2007.

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Saturday, July 07, 2007

Practical applications of biofuels for the poor - Highlights from the International Conference on Biofuels (Day 2, part 2)

During the fourth session of the International Conference on Biofuels, Simon Trace, chief executive of the NGO Practical Action explained how biofuels can help the poor in very concrete ways, but also warned on circumstances under which they can be less beneficial and risky.

Practical Action is committed to helping the 'really poor' people in the developing world, that is those who live on less than a dollar a day, by using appropriate technologies. The organisation looks at designing concrete solutions for problems such as water and energy access, shelter, transport and food access. It does so by collaborating directly with the communities and by sticking to utilizing local resources, in short, it relies on a strictly bottom-up approach.

In his fascinating presentation, Simon Trace outlined three main reasons as to why the poor should be interested in biofuels: (1) they may offer technical solutions to improved energy access, (2) they may boost rural communities' incomes, and (3) they should be informed about the risks of large-scale projects, which may have negative impacts on their life-world.

Trace set out by stating that not all biofuels are equal, and that the energy and greenhouse gas balance of different fuels must be taken into account. When it comes to their potential to reduce carbon dioxide emissions, he made the following remark:
If one hectare of grassland is converted to sugar cane for ethanol, it may save 12 tonnes of carbon dioxide. But if that same hectare were to be afforested and the trees left to stand, it would save up to 20 tonnes of CO2.
Of course, this is a bit misleading, because trees don't offer a liquid fuel, which has many socio-economic benefits (mobility, transport of goods and persons, and its crucial role in local economies). Sugar cane based ethanol offers both: impressive CO2 reductions and a transport fuel. In short, the opportunity costs of different land-use options must be analysed in-depth.

Biofuels and energy access
Practical Action then presented a case for biofuels at the local level, in that they can help increase energy access for poor communities - both energy for household use (cooking, heating, cooling) as for transport (crucial in rural and remote communities, where fossil fuels are often extremely expensive or simply not available.)

Almost two billion people in the developing world have no access to modern energy and rely on primitive biomass resources. The sheer physical burden of collecting fuel wood is enormous. Trace stressed that this burden on the body is itself extremely energy inefficient - women and often children spend a lot of their (scarce) calories on walking and carrying raw energy from the gathering site to the home, where the primitive fuel is then burned in highly inefficient ways on open fires. An open fire wastes up to 90 per cent of the useful energy contained in wood or dung, and causes indoor air pollution, a major health burden in the developing world killing up to 1.5 million women and children per year.

But the economic burden is equally big: lack of access to modern energy prevents communities from running schools, hospitals, telecommunications and households in efficient ways - all these are crucial for local development and poverty alleviation.

Biofuels can contribute to solving these problems, in the following ways:
:: :: :: :: :: :: :: :: :: :: :: :: ::

They can be produced locally, from local crops and in a small-scale, decentralised manner. This is most feasible for biodiesel production, the technology and start-up costs for which are less capital intensive than those for ethanol. In fact, in many instances, straight vegetable oils can be used in diesel engines without any adaptations (that is, in warm climates). The fuel can be used for power generation, for rural transport and for farm machinery, irrigation pumps, and so on.

Simon Trace explained that one of the major causes of poverty is isolation. Improving the access and mobility of the isolated poor paves the way for access to markets, services and opportunities. Practical Action has been running several projects with locally produced biodiesel in Peru, where the fuel is used by remote river communities to power their boats. Their only alternative is extremely expensive diesel fuel, which is often in short supply. The decentrally produced biodiesel is not only much cheaper, but supply chains and scales of the projects can be adapted to precise local needs.

Note that the Biopact is currently writing a project proposal on local biodiesel production in both Congos (Democratic Republic of Congo and the Republic of Congo) and the Central African Republic, where river transport is the true spine of the (informal) economies of these vast but sparsely populated countries. In the DRC alone, around 30 million people (50% of the total population) rely on river transport to move goods and people around on a daily basis. The rivers supply food and agricultural products for the 15 million other people who live in the country's largest cities. If fuel costs increase or fuel supplies are cut off, river transport collapses with dramatic consequences for all citizens. The situation is similar in the Republic of Congo and the CAR. Here too, locally produced biodiesel or straight vegetable oils are less expensive than petro-fuels, which are often simply not available at all. Biofuels can break the economic uncertainties and dependence that come with reliance on imported fossil fuels.

Simon Trace then briefly focused on the famous jatropha projects in Mali, where the Mali Folke Center has been cooperating with the UNCTAD and the UNDP to run local energy platforms. Jatropha biodiesel is used in Lister-Petter diesel generators for electricity production. Even though the technology is appropriate in the case of Malian communities, in other places alternatives like solar and micro-hydro might be more suitable and efficient, Trace thinks. (We doubt this, as solar comes at a cost 10 to 20 times higher than most bioenergy projects based on biogas or locally manufactured biodiesel; micro-hydro can be less costly but only works where conditions permit its application).

Better cooking stoves - which are under development by many organisations - as well as biogas made in anaerobic digesters that ferment local waste streams, offer great potential as well.

In conclusion, when it comes to local energy access, the poor can definitely benefit from biofuels. But each community and its particular environment call for a thorough analysis of which technologies are most suitable - biofuels are only one of the many options, with others being wind, solar and micro-hydro.

The scale of the problem of the lack of energy access in the South is however gigantic (1.7 to 2 billion people are affected). If we want to solve the problem in 10 years time, we need to reach 475,000 people each single day, for ten years in a row...

Income generation
According to Trace, another major advantage of biofuels is their potential to generate income for the poor. This can be accomplished in different ways: (1) by involving rural communities in feedstock production, (2) by employment creation in the sector by large agribusiness, and (3) by redistributing the income or the savings generated on a national level to the poor; states can benefit from lower petroleum import bills when locally produced biofuels are used instead of diesel and gasoline; or they can acquire revenues from biofuel exports; this money can be spent on social services (health, education), on poverty alleviation programs or on infrastructure works that benefit the poor (e.g. rural roads).

Feedstock production
Experience with cash crops such as coffee, tea or cocoa shows that incomes only reach the poor when they acquire some part of ownership in the production chain. This can be achieved when farmers and workers organise in cooperatives or other forms of association. Smallholder production is not allways efficient, and so good extension services must be in place to make sure smallholders can survive and participate in the sector by applying the latest and most efficient farming techniques.

Large scale projects and jobs
Trace said large-scale production of biofuels can benefit local communities because they often offer many jobs - biofuel production is relatively labor intensive. But the logic of agribusiness is to be as efficient as possible, and, depending on the feedstock (perennial or annual), the threat of mechanisation always looms. Moreover, for crops such as sugar cane, much of the generated labor is seasonal. But all in all, large agribusiness must not be diabolised as such when it generates local employment and jobs that offer more perspectives than mere subsistence farming.

Redistributing national savings
When a state decides to produce biofuels to lessen its dependence on imported petroleum, it is of course crucial that the biofuel in question has a clear margin of competitiveness; in other words, it must be consistently and considerably less costly to produce than diesel or gasoline. Currently only Brazil (for ethanol) and Malaysia and Indonesia (biodiesel) can produce below fossil fuel prices (with oil at over US$ 35/40, sugar cane ethanol in Brazil is competitive; with oil at over US$60, palm based biodiesel is feasible).

However, when a national government saves on replacing petroleum by biofuels, then it is not very likely that these savings ever reach the poorest. The benefits are supposed to trickle down to them via social services (health, education), poverty alleviation programs or infrastructure works (rural roads, etc...). But Trace, citing a study by the New Economics Foundation, showed that in many developing countries, of each 100 dollars spent by governments, less than 1 dollar reaches the 10% poorest.

In short, the argument that the state can save money with biofuels and that this may benefit the most vulnerable in society, is theoretically correct, but only strong governance and appropriate policies can ensure that this theoretical potential is actually made tangible. Redistributive policies are difficult to implement in the highly developed world, so it is not to be expected that they will work easily in the lesser developed countries.

Potential negative effects of biofuels on the poor
But biofuels are no panacea, far from it. Simon Trace told the Conference there are several potential disadvantages and risks of biofuels in the developing world.

First of all, the effects of large scale production which does not involve rural households, on food prices must be understood and analysed more thoroughly. Farmers may benefit from increased food prices (and over 70 per cent of sub-Saharan Africa's population consists of farmers), but the urban poor (an ever growing group of people) will have no means do defend themselves against this. These uncertainties must be addressed in assessments of large biofuel projects and mitigated by appropriate policies.

Further, market forces may push interesting biofuel feedstocks that may benefit small farmers and may help restore the environment (such as Jatropha curcas) out of the market, in favor of monocultures that bring few jobs.

Third, there is a serious problem with land tenure in the South. Small farmers often do not formally own the land they work on, and land grabs coming from outside and above (from top-down decisions and powerful companies) may push people off their land. Strong land reform and formal land ownership rules must be implemented. The West must help developing countries with crafting such policies.

Fourth, some biofuel crops contribute to climate change instead of reducing carbon dioxide emissions. Obviously, when forests are cleared for energy crops, the biofuels derived from them are not 'green'.

However, in the debate following Trace's presentation, a representative from Malaysia raised the taboo subject of palm trees and their role in the carbon cycle. He stressed that rainforests sequester less carbon than palm trees, and there is some science backing this up. But obviously, the argument is quite absurd, because rainforests are biodiversity hotspots and offer many additional ecoservices. The value of rainforests for mankind is priceless.

Policies crucial
To conclude, Simon Trace stressed the crucial role of policy frameworks. Biofuels can have many advantages - reduced GHG emissions, increased energy security - but in the end, it depends on us to make sure we also realise their potential to benefit the poor.

Policies decide whether the savings on imported fuel costs are redistributed in a fair way; land tenure policies decide whether the poor become owners of their own land and of their productive activities; and policies decide whether biofuels are produced in a socially and environmentally sustainable way.

Jonas Van Den Berg & Laurens Rademakers, Biopact, 2007, cc.

Simon Trace's presentation should be online at the Conference website soon or at the website of Practical Action.


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