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    The University of East Anglia and the UK Met Office's Hadley Centre have today released preliminary global temperature figures for 2007, which show the top 11 warmest years all occurring in the last 13 years. The provisional global figure for 2007 using data from January to November, currently places the year as the seventh warmest on records dating back to 1850. The announcement comes as the Secretary-General of the World Meteorological Organization (WMO), Michel Jarraud, speaks at the Conference of the Parties (COP) in Bali. Eurekalert - December 13, 2007.

    The Royal Society of Chemistry has announced it will launch a new journal in summer 2008, Energy & Environmental Science, which will distinctly address both energy and environmental issues. In recognition of the importance of research in this subject, and the need for knowledge transfer between scientists throughout the world, from launch the RSC will make issues of Energy & Environmental Science available free of charge to readers via its website, for the first 18 months of publication. This journal will highlight the important role that the chemical sciences have in solving the energy problems we are facing today. It will link all aspects of energy and the environment by publishing research relating to energy conversion and storage, alternative fuel technologies, and environmental science. AlphaGalileo - December 10, 2007.

    Dutch researcher Bas Bougie has developed a laser system to investigate soot development in diesel engines. Small soot particles are not retained by a soot filter but are, however, more harmful than larger soot particles. Therefore, soot development needs to be tackled at the source. Laser Induced Incandescence is a technique that reveals exactly where soot is generated and can be used by project partners to develop cleaner diesel engines. Terry Meyer, an Iowa State University assistant professor of mechanical engineering, is using similar laser technology to develop advanced sensors capable of screening the combustion behavior and soot characteristics specifically of biofuels. Eurekalert - December 7, 2007.

    Lithuania's first dedicated biofuel terminal has started operating in Klaipeda port. At the end of November 2007, the stevedoring company Vakaru krova (VK) started activities to manage transshipments. The infrastructure of the biodiesel complex allows for storage of up to 4000 cubic meters of products. During the first year, the terminal plans to transship about 70.000 tonnes of methyl ether, after that the capacities of the terminal would be increased. Investments to the project totaled €2.3 million. Agrimarket - December 5, 2007.

    New Holland supports the use of B100 biodiesel in all equipment with New Holland-manufactured diesel engines, including electronic injection engines with common rail technology. Overall, nearly 80 percent of the tractor and equipment manufacturer's New Holland-branded products with diesel engines are now available to operate on B100 biodiesel. Tractor and equipment maker John Deere meanwhile clarified its position for customers that want to use biodiesel blends up to B20. Grainnet - December 5, 2007.

    According to Wetlands International, an NGO, the Kyoto Protocol as it currently stands does not take into account possible emissions from palm oil grown on a particular type of land found in Indonesia and Malaysia, namely peatlands. Mongabay - December 5, 2007.

    Malaysia's oil & gas giant Petronas considers entering the biofuels sector. Zamri Jusoh, senior manager of Petronas' petroleum development management unit told reporters "of course our focus is on oil and gas, but I think as we move into the future we cannot ignore the importance of biofuels." AFP - December 5, 2007.

    In just four months, the use of biodiesel in the transport sector has substantially improved air quality in Metro Manila, data from the Philippines Department of Environment and Natural Resources (DENR) showed. A blend of one percent coco-biodiesel is mandated by the Biofuels Act of 2007 which took effect last May. By 2009, it would be increased to two percent. Philippine Star - December 4, 2007.

    Kazakhstan will next year adopt laws to regulate its fledgling biofuel industry and plans to construct at least two more plants in the next 18 months to produce environmentally friendly fuel from crops, industry officials said. According to Akylbek Kurishbayev, vice-minister for agriculture, he Central Asian country has the potential to produce 300,000 tons a year of biodiesel and export half. Kazakhstan could also produce up to 1 billion liters of bioethanol, he said. "The potential is huge. If we use this potential wisely, we can become one of the world's top five producers of biofuels," Beisen Donenov, executive director of the Kazakhstan Biofuels Association, said on the sidelines of a grains forum. Reuters - November 30, 2007.

    SRI Consulting released a report on chemicals from biomass. The analysis highlights six major contributing sources of green and renewable chemicals: increasing production of biofuels will yield increasing amounts of biofuels by-products; partial decomposition of certain biomass fractions can yield organic chemicals or feedstocks for the manufacture of various chemicals; forestry has been and will continue to be a source of pine chemicals; evolving fermentation technology and new substrates will also produce an increasing number of chemicals. Chemical Online - November 27, 2007.

    German industrial conglomerate MAN AG plans to expand into renewable energies such as biofuels and solar power. Chief Executive Hakan Samuelsson said services unit Ferrostaal would lead the expansion. Reuters - November 24, 2007.

    Analysts think Vancouver-based Ballard Power Systems, which pumped hundreds of millions and decades of research into developing hydrogen fuel cells for cars, is going to sell its automotive division. Experts describe the development as "the death of the hydrogen highway". The problems with H2 fuel cell cars are manifold: hydrogen is a mere energy carrier and its production requires a primary energy input; production is expensive, as would be storage and distribution; finally, scaling fuel cells and storage tanks down to fit in cars remains a huge challenge. Meanwhile, critics have said that the primary energy for hydrogen can better be used for electricity and electric vehicles. On a well-to-wheel basis, the cleanest and most efficient way to produce hydrogen is via biomass, so the news is a set-back for the biohydrogen community. But then again, biomass can be used more efficiently as electricity for battery cars. Canada.com - November 21, 2007.

    South Korea plans to invest 20 billion won (€14.8/$21.8 million) by 2010 on securing technologies to develop synthetic fuels from biomass, coal and natural gas, as well as biobutanol. 29 private companies, research institutes and universities will join this first stage of the "next-generation clean energy development project" led by South Korea's Ministry of Commerce, Industry and Energy. Korea Times - November 19, 2007.

    OPEC leaders began a summit today with Venezuelan President Hugo Chavez issuing a chilling warning that crude prices could double to US$200 from their already-record level if the United States attacked Iran or Venezuela. He urged assembled leaders from the OPEC, meeting for only the third time in the cartel's 47-year history, to club together for geopolitical reasons. But the cartel is split between an 'anti-US' block including Venezuela, Iran, and soon to return ex-member Ecuador, and a 'neutral' group comprising most Gulf States. France24 - November 17, 2007.

    The article "Biofuels: What a Biopact between North and South could achieve" published in the scientific journal Energy Policy (Volume 35, Issue 7, 1 July 2007, Pages 3550-3570) ranks number 1 in the 'Top 25 hottest articles'. The article was written by professor John A. Mathews, Macquarie University (Sydney, Autralia), and presents a case for a win-win bioenergy relationship between the industrialised and the developing world. Mathews holds the Chair of Strategic Management at the university, and is a leading expert in the analysis of the evolution and emergence of disruptive technologies and their global strategic management. ScienceDirect - November 16, 2007.

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Thursday, December 13, 2007

EU 2008 budget cuts farm subsidies, boosts competitiveness, energy and rural development

The European Parliament today approved the EU's budget for 2008 and, for the first time ever, the largest share will go on measures to boost economic growth and greater cohesion in the EU-27 and no longer on farm subsidies. This in itself is a break with tradition, even though agriculture will continue to receive over 40% of all EU cash. Transport and (renewable) energy, rural development, the environment and the knowledge based economy (R&D and education) are big winners.
With the largest share going to competitiveness, the 2008 budget is a concrete result of the Union's determination to put long-term economic development at the heart of the EU spending. This determination was echoed in the constructive way Parliament, Council and Commission reached an agreement. As EU leaders sign the new Treaty in Lisbon today, we can be satisfied that next year's budget will go where Europe's biggest challenges lie. - Dalia Grybauskaitė, Commissioner for Financial Programming and Budget
The adopted budget amounts to €129.1 billion in commitment appropriations (legal commitments), a moderate but steady increase of 2.2% compared to 2007. It corresponds to 1.03% of the EU Gross National Income (GNI). The payment appropriations (actual payments) will amount to €120.3 billion, or an increase of 5.7% in nominal terms. This represents a level of only 0.96% of EU-27 GNI.

Spending on economic development will grow almost three times more than the budget itself in 2008. The shift in spending on economic progress in 2008 will see over €11 billion for competitiveness. There will be record investment in research which is set to receive €6.1 billion - a 11.0% rise on 2007. Also, investment in energy and transport networks will increase by around 93% with almost €2 billion to co-finance energy and transport projects in the EU (schematic, click to enlarge; and overview of the entire budget, here).

Farm subsidies
Despite the decrease (3.4% less than 2007) in money for 'market related expenditure' and 'direct payments' (that is: all kinds of subsidies), spending on agriculture will remain stable in 2008, absorbing the bulk of the EU's budget: €40.9 billion. There is however a gradual shift within this policy area with funds being directed towards tackling environmental challenges and fostering development in rural areas. Both of these areas will see a rise in spending of 12% and 4.5% respectively, notably through the LIFE+ environmental protection programme which will increase by 11%. Life+ includes many bioenergy and climate change related projects.

The cut in direct subsidies is in line with the reform of the Common Agricultural Policy (CAP) (previous post for more on the policy as it relates to bioenergy). Biopact readers know that the ideal of a 'bioenergy pact' with the poorer countries of the South hinges on reduced farm subsidies in the EU. Besides trade reform, CAP reform is an absolute sine qua non for the establishment of such a 'win-win' relationship with developing country farmers.

Rural development

The reduction of direct farm subsidies is however partly compensated by the budget shift towards rural development. Rural development policy remains the second biggest post of the entire budget, receiving €12.9 billion (4.5% more than in 2007). Let's have a closer look at this policy as it relates to the bioenergy sector:
:: :: :: :: :: :: :: :: ::

With over 60 % of the population in the 27 member states of the European Union living in rural areas, which cover 90 % of the territory, rural development is a vitally important policy area. Farming and forestry remain crucial for land use and the management of natural resources in the EU's rural areas, and as a platform for economic diversification in rural communities. The strengthening of EU rural development policy has, therefore, become an overall EU priority.

Agriculture and forestry represent 77 % of land use in the EU. The combined agricultural sector forms an important part of the EU economy, accounting for 15 million jobs (8,3 % of total employment) and 4,4 % of GDP. The EU is the world’s largest producer of food and beverages, with combined production estimated at €675 billion. However, the sector remains highly polarised and fragmented in terms of size, with significant opportunities and threats for firms. Forestry and related industries employ around 3,4 million people with a turnover of €350 billion, but only 60% of annual forest growth is currently exploited.

The EU's Rural Development Policy is aimed at boosting competitiveness, job creation and innovation in rural areas and improved governance in the delivery of programmes. It focuses on forward-looking investments in people, know-how and capital in the farm and forestry sectors, on new ways of delivering win-win environmental services and on creating more and better jobs through diversification, particularly for women and young people.

The EU Strategic Guidelines for Rural Development (2007-2013), show that policy is built around four axes, namely, (1) improving the competitiveness of the agricultural and forestry sector; (2) improving the environment and the countryside; (3) improving the quality of life in rural areas and enhancing the diversification of the rural economy; and (4) stimulating governance through locally based, bottom-up approaches to rural development.

The promotion of bioenergy and biofuels is taken up under all four axes:

1. The Community Strategic guideline on improving the competitiveness of the agricultural and forestry sector focuses on the priorities of knowledge transfer, modernisation, innovation and quality, and on priority sectors for investment in physical and human capital. One key action under this axis consists of:
Developing new outlets for agricultural and forestry products. New outlets can offer higher value added, in particular for quality products. Support for investment and training in the field of non-food production under rural development can complement measures taken under the first pillar by creating innovative new outlets for production or helping the development of renewable energy materials, biofuels and processing capacity.
The guideline also aims to facilitate innovation and access to research and development (R & D). Innovation is increasingly important for Europe’s farming, agrifood, bioenergy and forestry sectors. The introduction of new products and processes could significantly contribute to the performance of smaller processors and farm businesses. In particular, new forms of cooperation could facilitate access to R & D, innovation and actions undertaken under the Seventh Framework Programme (FP7).

Recently, the EU made available €1.75 billion for new research under FP7, with bioenergy and biofuels taking a major share (previous post).

2. The guideline on improving the environment and the countryside is aimed at contributing to three EU-level priority areas: biodiversity and the preservation and development of high nature value farming and forestry systems and traditional agricultural landscapes; water; and climate change. The key action regarding bioenergy falls under the heating 'combating climate change':
Agriculture and forestry are at the forefront of the development of renewable energy and material sources for bioenergy installations. Appropriate agricultural and forestry practices can contribute to the reduction in greenhouse gas emissions and preservation of the carbon sink effect and organic matter in soil composition, and can also help in adapting to the impacts of climate change.
3. The Community Strategic Guideline on improving the quality of life in rural areas and encouraging diversification of the rural economy should promote capacity building, skills acquisition and organisation for local strategy development and also help ensure that rural areas remain attractive for future generations. The key actions for bioenergy are described as follows:
Developing the provision and innovative use of renewable energy sources, which can contribute to creating new outlets for agricultural and forestry products, the provision of local services and the diversification of the rural economy.
4. Finally, building local capacity for employment and diversification is the subject of another guideline that should contribute to the priorities outlined in the previous three axes, but also plays an important role in the horizontal priority of improving governance and mobilising the endogenous development potential of rural areas. Key actions relating to bioenergy include:
Building local partnership capacity, animation and promoting skills acquisition, which can help mobilise local potential; promoting private-public partnerships; promoting cooperation and innovation, and improving local governance. These actions will foster innovative approaches to linking agriculture, forestry and the local economy, thereby helping to diversify the economic base and strengthen the socioeconomic fabric of rural areas.
Biopact welcomes the shift away from farm subsidies and towards rural development. CAP reform and the reduction in handouts to Europe's already well protected farmers is crucial for those who strive towards helping developing country farmers participate in the global market. By stimulating rural development policy in the EU - and the R&D, innovation and diversification this entails - the European farming and forestry sector will have a chance to help develop bioenergy technologies and concepts that could end up later in the South as part of tech transfers.

This is a much better development than simply continuing the policy of handing out billions to Europe's farmers and distorting the market. It will take years before the EU's CAP reform will be felt by farmers in the South, but taking away money from the subsidy schemes is a first good step.

Two other noteworthy and controversial budget posts are the financing of Galileo (the European satellite navigation system, which will be independent of the American, Russian and Chinese systems) and the European Institute of Technology (EIT): both projects will be funded entirely by the European Community, without jeopardising the necessary financial means of the Lisbon Agenda multiannual programmes such as Lifelong Learning and Trans-European Networks. Globally, €3.7bn are foreseen for Galileo and EIT within the multi-annual financial framework until 2013.

Europa: EU budget 2008: biggest share to go on boosting economic growth - December 13, 2007.

European Parliament: Final EU 2008 Budget: €120.3bn, 5.7 % increase in 2007, go ahead for Galileo and the European Institute of Technology - December 13, 2007.

European Council: Council Decision of 20 February 2006 on Community strategic guidelines for rural development (programming period 2007 to 2013), Official Journal L 055 , 25/02/2006 P. 0020 - 0029.

European Commission, DG Financial Programming and Budget: EU Budget 2008 in figures, brochure [*.pdf].

European Commission, DG Environment: LIFE+.

Biopact: EU makes available €1.75 billion for new research under 7th Framework Programme - emphasis on bioenergy and biofuels - November 30, 2007

Biopact: European Commission initiates 'health check' of Common Agricultural Policy - implications for bioenergy - November 20, 2007


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