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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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Thursday, July 05, 2007

Sweden calls for the creation of a 'biopact' with the South - Highlights from the International Conference on Biofuels (Day 1, part 2)

Today's second session at the International Conference on Biofuels focused on the development of international trade in biofuels. The chief of staff of Brazil's President, India's Minister of New and Renewable Energies, the Ukraine's Vice-Prime Minister of Energy and Transport, and European Commissioner for Trade Peter Mandelson presented the many challenges ahead for the creation of a global biofuels market.

They include technical issues like standardisation of fuels, the elimination of tariffs and import duties, a reassessment of farm and biofuel subsidies, a new trade status for the renewable fuels, and the creation of a set of sustainability criteria without these rules becoming new barriers to trade.

Sweden's Minister for Trade, Sten Tolgfors, was most outspoken on what needs to be done (full speech). His country is Europe's greenest economy and the fastest growing user of biofuels. Sweden has also become the largest European importer of bio-ethanol from Brazil, which supplies 75% of ethanol used in the country.

Tolgfors outlined the advantages of what we call a 'Biopact' with the South. And to back up the fact that Sweden is committed to such a pact, it has set a target to decrease its use of fossil fuels in motor vehicles to 50% of current usage by 2020 made possible by importing biofuels from poor countries - a stark difference from the binding EU target of 10%.

So what makes such a Biopact the most logical option for countries in the North? According to the minister, biofuels only make sense when they are produced in such a way that they help contribute to reducing greenhouse gas (GHG) emissions. Countries in temperate climates do not have the agro-ecological resources to produce such fuels, but the Global South does. The energy and GHG balance of ethanol produced in Brazil is many times better than biofuels made in the North. The natural competitive advantages leading to this situation, must therefor be exploited to the fullest.

Consumers, producers and the climate benefit from biofuel trade
Tolgfors stressed that both tariffs and non-tariff trade barriers in the EU make biofuels for European consumers much more costly than they have to be. When imported from the South, consumers in the North benefit, as testified by the fact that ethanol from Brazil costs less than half that of the same fuel made in Europe. Sweden's imports as well the country's automakers' development of flex-fuel vehicles, are responsible for the sudden success of biofuels there. Swedish consumers have started buying flex-fuel cars, because they know the imported bio-ethanol is affordable, and hasn't been subsidised.

According to the trade minister, it has become untenable to keep a 54% tariff on imported ethanol, when the tariff on polluting (and costlier) gasoline is only 5%. These and other trade distortions must be abandoned in order to create a win-win situation for both the South and the North.

The advantages of such a 'Biopact' are manifold: producers in the developing world can enjoy their competitive advantages (abundant land and crops under suitable agro-ecological conditions), and can finally enter a market with a product that will not face price collapses, as has been the case with traditional commodities; demand for the product can only increase when oil prices remain high and when efforts to mitigate climate change are stepped up; finally, consumers in the North as well as in the developing world benefit from less costly fuels - an important aspect in a world in which access to mobility has become a crucial social good. Large-scale production of biofuels in the South - if implemented in a socially inclusive way - offers opportunities for poverty alleviation in countries with large rural populations.

Ending 'resource nationalism'
For all these reasons, Sweden, followed by the Netherlands, has launched a formal request for a study by the OECD on how to get rid of the current trade distortions, to which it objects (we reported on this earlier). If necessary, Tolgfors said, the EU should abandon these distortions alone, without waiting for the US:
:: :: :: :: :: :: :: :: :: :: :: :: ::

The Minister referred to European Trade Commissioner Mandelson and his recent proposal to lower taxation and tariffs on so-called 'environmental goods and services': if a proposal for lower duties on these products and services has become an official position of the EU's trade commissioner, then biofuels must follow. Tolgfors calls for the total abolishment of all forms of trade taxation and protectionist measures for ethanol and biodiesel.

The implementation of such trade reforms must however be accompanied by the creation of mechanisms that measure the sustainability of biofuels. Few developing countries will experience an immediate boost in biofuel production, because they often lack technological and agronomic expertise. This leaves time to help them devise policies that ensure social and environmental sustainability. But for countries that already have a working and sustainable biofuels industry, like Brazil, the abandonment of tariffs and trade barriers would only be fair.

Temporal synergy
In the meantime, as developing countries make the transition from the status of agricultural importer (the result of farm subsidies and trade barriers in the US/EU) to that of biofuel exporter, the European Union's producers will make progress on the development of next-generation biofuels. In Sweden, such fuels are already being produced from cellulose.

In short, it becomes possible to think of a synergy between two developments: the time needed for the developing world to become a large biofuel exporter, will be long enough for the EU to become more competitive via cellulosic ethanol. Over the short term, the EU will have to import biofuels from the South in order to reach its 10% target, but in the longer term, its degree of self-sufficiency will rise because of more efficient next-generation fuels. At the end of this cycle (15 years from now), cellulosic bioconversion technologies can be transferred to the South, to increase the energy and GHG balance of fuels there even further.

The Swedish minister's logic comes close to that of the Biopact, as it was expressed in an opinion piece over at EurActiv.

European Commissioner for Trade, Peter Mandelson, largely agreed with his Swedish collegue, and added that the EU is the best actor when it comes to helping the developing world creating biofuels industries that respect the social wellbeing of the farmers as well as the environment. The EU has the technological and scientific expertise needed to achieve this.

However, Mandelson tried to balance the importance of environmental sustainability against 'resource nationalism', and concluded that sustainability criteria are crucial but should not become barriers to trade aimed at protecting European farmers.

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

Picture: Sweden's Minister for Trade, Sten Tolgfors.

Government Offices Sweden: Sten Tolgfors, Minister for Foreign Trade: Speech International Conference on Biofuels, Brussels 05 July 2007.

(Check against delivery)

EurActiv: 'Towards a bioenergy pact with the global south' - Feb. 15, 2007.

Biopact: Sweden looks to Indonesia for green fuels - June 01, 2007.

In a next piece, we zoom in on the points presented by Brazil's President Lula, by the President of the European Commission, and by the new President of the European Union.

Tomorrow, on day two of the conference, focus will shift to the opportunities and risks of producing biofuels in developing countries (session 1) and on the latest scientific and technological developments in bioenergy, in the EU and abroad (session 2).


Anonymous said...

Taking action about the global warming is a good thing, as long as we don't do any unnecessary efforts and we focus on the really important aspects: deifning the factors and finding solutins.

Easily, some have accepted that the factors are pollution, energy consumption and greenhouse gasses, but nobody talks about the oceans and the way they can influence the climate. It's like, we try to solve the pollution issue (which is important, no doubt about that), but we should also think about the oceans and how we can prevent it from influencing the climate.

11:21 PM  
Biopact team said...

True, oceans are important. But how exactly do they fit in with bioenergy? Are you pointing at ocean acidification as a result of burning fossil fuels?

11:25 PM  

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