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    Finland's Metso Power has won an order to supply Kalmar Energi Värme AB with a biomass-fired power boiler for the company’s new combined heat and power plant in Kalmar on the east coast of Sweden. Start-up for the plant is scheduled for the end of 2009. The value of the order is approximately EUR 55 million. The power boiler (90 MWth) will utilize bubbling fluidized bed technology and will burn biomass replacing old district heating boilers and reducing the consumption of oil. The delivery will also include a flue gas condensing system to increase plant's district heat production. Metso Corporation - September 19, 2007.

    Jo-Carroll Energy announced today its plan to build an 80 megawatt, biomass-fueled, renewable energy center in Illinois. The US$ 140 million plant will be fueled by various types of renewable biomass, such as clean waste wood, corn stover and switchgrass. Jo-Carroll Energy - September 18, 2007.

    Beihai Gofar Marine Biological Industry Co Ltd, in China's southern region of Guangxi, plans to build a 100,000 tonne-per-year fuel ethanol plant using cassava as feedstock. The Shanghai-listed company plans to raise about 560 million yuan ($74.5 million) in a share placement to finance the project and boost its cash flow. Reuters - September 18, 2007.

    The oil-dependent island state of Fiji has requested US company Avalor Capital, LLC, to invest in biodiesel and ethanol. The Fiji government has urged the company to move its $250million 'Fiji Biofuels Project' forward at the earliest possible date. Fiji Live - September 18, 2007.

    The Bowen Group, one of Ireland's biggest construction groups has announced a strategic move into the biomass energy sector. It is planning a €25 million investment over the next five years to fund up to 100 projects that will create electricity from biomass. Its ambition is to install up to 135 megawatts of biomass-fuelled heat from local forestry sources, which is equal to 50 million litres or about €25m worth of imported oil. Irish Examiner - September 16, 2007.

    According to Dr Niphon Poapongsakorn, dean of Economics at Thammasat University in Thailand, cassava-based ethanol is competitive when oil is above $40 per barrel. Thailand is the world's largest producer and exporter of cassava for industrial use. Bangkok Post - September 14, 2007.

    German biogas and biodiesel developer BKN BioKraftstoff Nord AG has generated gross proceeds totaling €5.5 million as part of its capital increase from authorized capital. Ad Hoc News - September 13, 2007.

    NewGen Technologies, Inc. announced that it and Titan Global Holdings, Inc. completed a definitive Biofuels Supply Agreement which will become effective upon Titan’s acquisition of Appalachian Oil Company. Given APPCO’s current distribution of over 225 million gallons of fuel products per year, the initial expected ethanol supply to APPCO should exceed 1 million gallons a month. Charlotte dBusinessNews - September 13, 2007.

    Oil prices reach record highs as the U.S. Energy Information Agency releases a report that showed crude oil inventories fell by more than seven million barrels last week. The rise comes despite a decision by the international oil cartel, OPEC, to raise its output quota by 500,000 barrels. Reuters - September 12, 2007.

    OPEC decided today to increase the volume of crude supplied to the market by Member Countries (excluding Angola and Iraq) by 500,000 b/d, effective 1 November 2007. The decision comes after oil reached near record-highs and after Saudi Aramco announced that last year's crude oil production declined by 1.7 percent, while exports declined by 3.1 percent. OPEC - September 11, 2007.

    GreenField Ethanol and Monsanto Canada launch the 'Gro-ethanol' program which invites Ontario's farmers to grow corn seed containing Monsanto traits, specifically for the ethanol market. The corn hybrids eligible for the program include Monsanto traits that produce higher yielding corn for ethanol production. MarketWire - September 11, 2007.

    Ethanol Statistics, a new industry information resource, reports that U.S. petroleum refiners Citgo and Valero are the top 2 ethanol importing companies in the United States in the first 6 months of 2007. Overall imports were up 7.64% compared to the same period in 2006, from 193,620 gallons to 208,404 gallons. Chevron imported 43% less, whereas Noble and ConocoPhilips' imports were up 255% and 372% respectively. Data are reported in 'The United States Ethanol Market 2007’, which also provides a breakdown of U.S. ethanol production costs and a detailed analysis of U.S. consumption and production. Ethanol Statistics - September 10, 2007.

    The government of British Columbia launches a $100,000 study into the production of biogas, heat, power and clean water from household waste streams. Raw sewage water can be cleaned by microbial fuel cells that deliver electricity as they clean the water; other technologies include classic anaerobic fermentation. Canada.com - September 10, 2007.

    Saudi Aramco in its Annual Review 2006 said that last year the company's crude oil production declined by 1.7 percent, while exports declined by 3.1 percent, compared with the previous year. Crude oil production in 2006 averaged 8.9 million barrels of oil a day (b/d) and exports 6.9 million b/d. Saudi Aramco - September 9, 2007.

    Chinese packaging manufacturer Livan Biodegradable Product Co. Ltd. will build plants in Alsozsolca and Edeleny in eastern Hungary at a combined cost of €18 million by 2009, the Hungarian economics ministry says. The plants, which will employ 800 people, are planned to produce initially 50, 000 metric tons a year of environmentally-friendly packaging material, and double that amount by a later date. Livan will use corn to manufacture biodegradable packaging boxes with similar properties to petroleum-based plastic boxes used in the food industry. Dow Jones Newswires - September 7, 2007.

    South Korea aims to raise biodiesel content in domestic diesel to 3 percent from the current 0.5 percent by 2012, Seoul's energy ministry said today. The government was initially set last year to impose a mandatory 5 percent blend, in line with the level targeted by the European Union by 2010, but the country's powerful refining lobby opposed the move, forcing it to push back the target, according to market sources. Reuters - September 7, 2007.

    Virent Energy Systems, Inc. announced today that it has closed a US$21 million second round of venture financing. Investor interest in Virent was driven in large part by the Company’s continued development of its innovative BioForming process beyond its traditional hydrogen and fuel gas applications and toward the production of bio-based gasoline, diesel, and jet fuels. Virent Energy Systems - September 6, 2007.

    The U.S. National Ethanol Vehicle Coalition (NEVC) announces that 31 models of motor vehicles will be offered in the U.S. with an E85 capable engine in 2008. Chrysler, Ford, General Motors, Nissan and Mercedes Benz will all offer flexible fuel vehicles (FFVs) in the coming year. The NEVC expects 750,000 such FFVs will be produced in 2008. National Ethanol Vehicle Coalition - September 5, 2007.

    GreenHunter BioFuels, Inc., has begun commercial operations with the start-up of a 1,500 barrel per day methanol distillation system. Methanol is an alcohol used to transesterify vegetable oils into biodiesel. The methanol production facility is a key element of GreenHunter's 105 million gallon per year biodiesel refinery, the largest in the U.S., slated for initial operations during the first quarter of 2008. PRNewswire - September 5, 2007.

    GreenHunter BioFuels, Inc., has begun commercial operations with the start-up of a 1,500 barrel per day methanol distillation system. Methanol is an alcohol used to transesterify vegetable oils into biodiesel. The methanol production facility is a key element of GreenHunter's 105 million gallon per year biodiesel refinery, the largest in the U.S., slated for initial operations during the first quarter of 2008. PRNewswire - September 5, 2007.

    Spanish renewables group Abengoa released its results for the first half of 2007 financial year in which its consolidated sales were €1,393.6 million, which is a 27.9 percent increase on the previous year. Earnings after tax were €54.9 million, an 18.6 percent increase on the previous year's figure of 46.3 million euro. Abengoa is active in the bioenergy, solar and environmental services sector. Abengoa - September 4, 2007.

    Canadian hydro power developer Run of River Power Inc. has reached an agreement to buy privately owned Western Biomass Power Corp. in a $2.2 million share swap deal that could help finance development of new green sources of electricity in British Columbia. The Canadian Press - September 4, 2007.

    As of Sept. 1, a biodiesel blending mandate has come into force in the Czech Republic, requiring diesel suppliers to mix 2 per cent biodiesel into the fuel. The same rule will be obligatory for gasoline starting next year. In 2009 the biofuel ratio will grow to 3.5 percent in gasoline and 4.5 percent in diesel oil. CBW - September 3, 2007.

    Budapest's first biofuel station opens on Monday near the Pesterzsébet (District XX) Tesco hypermarket. This is the third station selling the E85 fuel containing bioethanol in Hungary, as two other stations are encouraging eco-friendly driving in Bábolna and Győr. Caboodle - September 3, 2007.

    Canadian forest products company Tembec announced that it has completed the acquisition of the assets of Chapleau Cogeneration Limited located in Chapleau, Ontario. The transaction includes a biomass fired boiler and steam turbine with an installed capacity of 7.2 megawatts. Consideration for the assets consists of a series of future annual payments to 2022, with a present value of approximately $1 million. Tembec - September 1, 2007.

    Innovative internet and cable/satellite channel CurrentTV is producing a documentary on Brazil's biofuel revolution. Biopact collegues and friends Marcelo Coelho (EthanolBrasil Blog), Henrique Oliveira (Ethablog) and Marcelo Alioti (E-Machine) provided consulting on the technical, economic, environmental and social aspects of Brazil's energy transformation. ProCana - August 31, 2007.

    Oil major BP Plc and Associated British Foods Plc won competition clearance from the European Commission on to build a plant to make transport fuel from wheat in Hull, northeast England. U.S. chemical company DuPont is also involved. Reuters UK - August 31, 2007.

    The government of the Indian state of Orissa announced its policy for biofuel production which includes a slew of incentives as well as measures to promote the establishment of energy plantations. The state aims to bring 600,000 hectares of barren and fallow land under Jatropha and Karanj. At least 2 million hectares degraded land are available in the State. The new policy's other objectives are to provide a platform for investors and entrepreneurs, market linkages and quality control measures. Newindpress - August 29, 2007.

    Brazil's state-run oil company Petrobras said today it expects to reach large scale cellulosic ethanol production in 2015, with the first plant entering operations as early as 2011. Lignocellulosic biomass is the most abundant biological material on the planet, making up the bulk of the structure of wood and plants. In a first phase, Petrobras intends to use bagasse as a feedstock. Reuters / MacauHub- August 29, 2007.

    Seattle based Propel Biofuels, is announcing a $4.75 million first round of capital from @Ventures and Nth Power. The money will be used to help Propel set up and manage biodiesel fueling stations. BusinessWire - August 29, 2007.

    BioEnergy International, a science and technology company committed to developing biorefineries to produce fuels and specialty chemicals from renewable resources, announced today the closing of a major US$61.6 million investment that will provide funding for the Company’s three strategic initiatives: generating secure cash flow from its conventional ethanol platform, product diversification through the introduction of novel biocatalysts for the manufacture of green chemicals and biopolymers and the integration of its cellulose technology. BusinessWire - August 28, 2007.

    German company Verbio Vereinigte BioEnergie, the biggest biofuels producer in Europe, says it is considering plans to invest up to €100/US$136.5 million in a biofuel production facility in Bulgaria. The company wants the new facility to be located close to a port and Bulgaria's city of Varna on the Black Sea is one of the options under consideration. If Verbio goes through with the plan, it would produce both biodiesel and bioethanol, making Bulgaria a major source of biofuels in southeastern Europe. Verbi currently produces around 700,000 tonnes of biofuels per year. Sofia News Agency - August 27, 2007.

    Czech brown-coal-fired power plant Elektrárna Tisová (ETI), a unit of the energy producer ČEZ, could co-fire up to 40,000 tons of biomass this year, the biggest amount in the company’s history, said Martin Sobotka, ČEZ spokesman for West Bohemia. ETI burned more than 19,000 tons of biomass in the first half of 2007. The company’s plan reckoned with biomass consumption of up to 35,000 tons a year. Czech Business Weekly - August 27, 2007.

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Thursday, September 20, 2007

CO2 emissions could violate EPA ocean-quality standards within decades

In a commentary in the upcoming issue of the Geophysical Research Letters (GRL), a large team of scientists state that human-induced carbon dioxide (CO2) emissions will alter ocean chemistry to the point where it will violate U.S. Environmental Protection Agency Quality Criteria (1976) by mid-century if emissions are not dramatically curtailed now. This is the first recognition that atmospheric CO2 emissions will cause ocean waters to violate EPA water quality criteria.

The paper also says that carbon-dioxide induced changes in ocean chemistry within the ranges predicted for the next decades and centuries present significant risks to marine biota and that adverse impacts on food webs and key biogeochemical process would result.

An international team of twenty five leading researchers described the evidence to date regarding the effects of CO2 emissions on the acidity of the world's oceans. The study was led by Ken Caldeira of Carnegie Institution's Department of Global Ecology. Included are researchers from Norway, the United Kingdom, France, Australia, Japan, Monaco, and the United States.

About one third of the CO2 from fossil-fuel burning is absorbed by the world's oceans, explained lead author Ken Caldeira. When CO2 gas dissolves in the ocean it makes carbonic acid which can damage coral reefs and also hurt other calcifying organisms, such as phytoplankton and zooplankton, some of the most critical players at the bottom of the world's food chain. In sufficient concentration, the acidity can corrode shellfish shells, disrupt coral formation, and interfere with oxygen supply.

Most of the research today points to a future where, in the absence of a major effort to curtail carbon dioxide emissions, there will be double the atmospheric concentrations of CO2 (760 parts per million, or ppm) by century's end. Atmospheric carbon dioxide concentrations could reach 500 ppm by mid-century. Pre-industrial concentrations, by comparison, were 280 ppm and today's concentration is about 380 ppm.

The acidity from CO2 dissolved in ocean water is measured by the pH scale (potential of Hydrogen). Declines in pH indicate that a solution is more acidic (map shows change in sea surface pH caused by anthropogenic CO2 between the 1700s and the 1990s). The U.S. Environmental Protection Agency (1976) Quality Criteria for Water state: "For open ocean waters where the depth is substantially greater than the euphotic zone, the pH should not be changed more than 0.2 units outside the range of naturally occurring variation". The euphotic zone goes to a depth of about 650 feet (200 meters), where light can still reach and photosynthesis can occur:
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Atmospheric CO2 concentrations need to remain at less than 500 ppm for the ocean pH decrease to stay within the 0.2 limit set forth by the U.S. Environmental Protection Agency [1976], remarked Caldeira. If atmospheric CO2 goes above 500 ppm, the surface of the entire ocean will be out of compliance with EPA pH guidelines for the open ocean. We need to start thinking about carbon dioxide as an ocean pollutant. That is, when we release carbon dioxide to the atmosphere, we are dumping industrial waste in the ocean.

Keeping atmospheric carbon dioxide concentrations below 500 ppm level would require a rapid global transition to a system of energy production and consumption that releases very little carbon dioxide to the atmosphere.

Map: Change in sea surface pH caused by anthropogenic CO2 between the 1700s and the 1990s. Credit: Wikimedia commons.


Caldeira, K. et al. (2007), Comment on "Modern-age buildup of CO2 and its effects on seawater acidity and salinity" by Hugo A. Loáiciga, Geophys. Res. Lett., doi:10.1029/2006GL027288, in press.

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China 'opening up' Congo for minerals, bioenergy with massive $5 billion loan

China has signed its largest single deal in Africa with the Democratic Republic of Congo (DRC): a $5 billion loan to develop infrastructures, mining, bioenergy, forestry and agriculture. Infrastructure Minister Pierre Lumbi said the money will be spent on building roads, railroads, hospitals, health centres, housing and universities. All other bilateral and multilateral loans pale in comparison with China's.

In exchange, the People's Republic will get rights to Congo's extensive natural resources, including timber, agricultural products, cobalt and copper. The move is part of China's quest to guarantee supplies of raw materials to its surging economy. After years of war, dictatorship and turmoil, Congo's infrastructure is either non-existent or in ruins, and extraction operations are producing at a fraction of their potential. China wants to change this and take the advantage as an early entrant in the country's reemerging economy.

The West has been caught offguard by the sheer scale and the timing of the deal, with the IMF, World Bank and others seeking clarification. The $5 billion package is the largest single loan to any African country of the $20 billion that China has pledged to finance trade and investment in the continent over the next few years.

A first phase of $3 billion will finance huge transport infrastructure projects in the DRC, including a 3,400km (2,125 mile) highway between the northeast city of Kisangani and Kasumbalesa on the border with Zambia. There will also be a 3,200 km (2,000 mile) railway to link the country's southern mining heartland to the main Atlantic port of Matadi in the west (map, click to enlarge).

Besides connecting the mining areas to the Atlantic, the infrastructure works are set to open the enormous central area of the DRC, where a vast agricultural potential can be found. Analysts estimate that this zone holds the world's second largest sustainable bioenergy potential, after that of Brazil.

Quickfacts and superlatives:
  • Congo experienced a natural resource war between 1996 and 2003 involving more than 10 countries; the conflict was the most lethal since the Second World War, killing an estimated 4.5 million Congolese; last year, the country held its first democratic elections since independence from Belgium, bringing Joseph Kabila to power; the East of the country remains unstable and hosts the UN's largest peace-keeping force
  • the Inga rapids on the Congo River - the world's largest river basin - could generate an estimated 42,000 MW of hydro-electricity (more than the Three Gorges and the Itaipu complex combined, see a detailed overview here); plans by an international consortium are under way to build the Grand Inga, which could light up the continent and export electricity to Europe and the Middle East (earlier post)
  • the Inga 2 dam is currently under reconstruction, which will bring electricity to the mining zones in the south; a $178 million World Bank loan is being used to revamp the world's largest network of power cables, a 1700 km stretch from Inga to the Katanga mining area; only 6% of all Congolese citizens have access to electricity
  • the DRC holds the world's largest reserves of cobalt (35% of the total), around 10% of the world's copper, and uranium, diamonds and gold
  • 70% of Congo's 57.5 million inhabitants are farmers; per capita GNI is amongst the lowest in the world, at around $120 per year (2006 estimate)
  • Congo currently utilizes less than 5% of its potential arable land, estimated to be around 167 million hectares (412m acres); projections show the country could maximally produce between 35 and 40 Exajoules of renewable bioenergy by 2050 in a sustainable way - that is, without deforestation and without threatening food, fodder and fiber demand of the country's growing population; this is equivalent to roughly 15.7 to 17.9 million barrels of oil per day, an output that can be sustained for decades
Under the Sino-Congolese deal, a further $2 billion is earmarked for rehabilitating the crumbling mining infrastructure and setting up joint ventures in the mines sector. The state mining conglomerate Gecamines went bankrupt in 1990 and since then there has been a free-for-all that sees hundreds of giant 36-wheel trucks plying the roads each day, carrying mineral-rich ores across the border to Zambia.

When it comes to bioenergy, Beijing is paving the way for investments in the forestry, palm oil and rubber sector, with a recent announcement by a Chinese firm that it might invest $1 billion in a 3 million hectare energy plantation. Besides half a million barrels of oil equivalent energy, the project would bring 'a hundred thousand jobs' (earlier post). For its part, the Congolese government has identified bioenergy and biofuel production as a priority area for industrialisation (earlier post), and is actively seeking foreign investors:
:: :: :: :: :: :: :: :: :: ::

China's move into the DRC is part of a wider scramble for resources in Africa. The official Xinhua press agency recently estimated there are at least 750,000 Chinese working or living for extended periods on the continent, a reflection of burgeoning economic ties that reached $55 billion in trade in 2006.

Chinese trade and investment has galvanised mineral production from South Africa (manganese) to Niger (uranium), and from Sudan to Angola (oil).

Much of that activity reflects an intense appetite for the African resources needed to fuel China's manufacturing sector, but big Chinese companies have quickly become formidable competitors in other sectors as well, particularly for big-ticket public works contracts, like the ones now proposed for DRC.

China is building major new railroad lines in Nigeria and Angola, large dams in Sudan, airports in several countries, and new roads almost everywhere.

One of the largest road builders, China Road and Bridge Construction, owned by the Chinese government, has 29 projects in Africa (many financed by the World Bank or other lenders) and offices in 22 African countries. So China's money may be going to Chinese companies to provide these big projects.

Skepticism in the West
The Chinese deal was signed at a time when an IMF mission landed in Kinshasa to review progress towards the resumption of budget support for Congo. IMF, World Bank and African Development Bank officials seem to have been caught offguard by the scale and timing of China’s plans.

The agreement comes at a delicate stage in Congo’s negotiations towards forgiveness of debt accumulated under the dictator Mobutu Sese Seko, who died in 1997, totalling about $8 billion, or equal to 800 per cent of current national exports.

Western mining groups, awaiting the results of a government review of about 60 contracts signed during the recent civil war, were also seeking more details from the Kinshasa government.

IMF and World Bank officials have acknowledged the scale of Congo’s infrastructure needs. But they are seeking to ascertain whether the Chinese loans are in line with Kinshasa’s commitment under the financial institutions’ heavily indebted poor countries debt reduction initiative not to contract new debt on anything but concessional terms.

In a best-case scenario, the IMF would restart a lending programme – the last one stalled in 2006 because of poor implementation – and Congo would stand to benefit from an 80 per cent write-off of its external debt in mid-2008 at the earliest. “If the terms of the deal do not meet the concessionality issue, that would be a concern,” said an IMF official.

Most of the mining activity in the country is being carried out by smaller, more entrepreneurial companies. Large western mining groups are keen to gain access to these resources to replace their dwindling deposits but have largely held back from investing in the country – put off by continuing unrest, widespread corruption and the lack of infrastructure.

Alex Gorbansky, managing director of Frontier Strategy Group, a political risk consultancy, said China’s $5bn draft agreement with Kinshasa would put pressure on both the large mining companies looking to get in and the small miners already there. “It will give China a distinct advantage in the Congolese copper belt,” he pointed out.

He said large western mining groups, such as Anglo American and Rio Tinto, were spending increasing amounts of time and money weighing opportunities in Congo. But China’s move might mean they had left it too late to secure the best assets. Gorbansky added that there was a risk that some of the mining licences held by smaller companies could be transferred to Chinese investors but Victor Kasongo, the country’s deputy mines minister, insisted this would not be the case.

Map: rough overview of Congo's transport infrastructures and China's projects. Credit: Biopact 2007, cc

Financial Times (via Onet): Alarm over China’s Congo deal - September 20, 2007

BBC: China opens coffers for minerals - September 18, 2007

BBC: Congo's cable revamp world record - July 31, 2007

World Bank: feature page on the DR Congo, with a good overview of the state of the country's economy.

Biopact: Energy to produce biofuels, from the world's largest dam - September 04, 2006

Biopact: New Congo government identifies bioenergy as priority for industrialisation - May 03, 2007

Biopact: DR Congo: Chinese company to invest $1 billion in 3 million hectare oil palm plantation - July 28, 2007

Biopact: International roundtable looks at building the world's largest dam in Congo - October 04, 2006

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Asia-Pacific nations urged to study biofuels more carefully

The nations of Asia and the Pacific are being urged to study the issue of biofuels with greater care before deciding on how they will use their agricultural products to generate energy. Scientists say there is an urgent need to support the current rush toward major decisions on biofuel policies in Asia and the Pacific with solid research and unbiased information about their potential benefits, impact, and risks. In the long-run the biofuels revolution promises to lead to both poverty alleviation and the protection of the environment, the scientists conclude, but this positive outcome depends on careful decisions to be taken today.

This appeal was issued at the end of a recent Expert Consultation on Biofuels organized by the Asia Pacific Association of Agricultural Research Institutions(APAARI) together with the Philippine-based International Rice Research Institute (IRRI), the International Crops Research Institute for the Semi-Arid Tropics in India (ICRISAT), the Washington-based International Food Policy Research Institute (IFPRI), and the International Maize and Wheat Improvement Center (CIMMYT) in Mexico. The consultation was held at IRRI’s headquarters in Los Baños, Philippines, on August 27-29.
There’s no doubt biofuels will have an impact on agriculture in Asia and the Pacific and present some very interesting new opportunities. But we need to be absolutely sure this will not affect the region’s food security and its continuing efforts to alleviate poverty. - R.S. Paroda, APAARI’s executive secretary
In the Asian region, both China and India are gearing up for substantial investments in biofuels. Malaysia and Indonesia are investing heavily in oil palm plantations for biodiesel production. The Philippines has mandated the blending of gasoline with 5 percent biofuel. However, at the same time, countries such as China have currently banned the use of maize – a vital food crop for national food and feed security – as biofuel.
The donor community should fund new R&D efforts on bioenergy, since the long-run benefits will lead to both poverty alleviation and protection of the environment – thus meeting two of the major Millennium Development Goals. - Conclusion 9 of the Expert consultation
The consultation focused on important issues such as (i) how bioenergy production may have an impact on global and regional food security, (ii) understanding bioenergy options for key crops and cropping systems in Asia, (iii) identifying research priorities for designing and evaluating integrated food-bioenergy production systems, and (iv) developing a framework for research on biofuels in key agricultural systems of Asia:
:: :: :: :: :: :: :: :: :: :: ::

Conclusions of the Expert Consultations

1. The Bioenergy Revolution is fast approaching. Biofuels will play a major role in the global economy of the future. Many countries are exploring different strategies and policies on alternative energy sources, and the Asia-Pacific region, in particular, is expected to play a significant role in the development and promotion of biofuels.

2. Poverty is still widespread in Asia. It is not clear to what extent poor farmers will benefit from the Bioenergy Revolution. What is clear is that the introduction and/or expansion of biofuel crops will cause major land-use changes, and that many feedstocks (although originally targeted at marginal lands) will compete with food crops in productive eco-regions. The challenge is to ensure a balance between food and biofuel production.

3. Policymakers need to protect the poor from rising commodity prices likely to be triggered by the diversion of crop produce or area expansion of biofuel crops. Therefore, there is an urgent need to strengthen policy research in order to avoid decisions that may lead to competition between food and bioenergy, and identify a complementary approach that benefits both sectors.

4. International organizations and the international agricultural research centers (IARCs) must accelerate their biofuel-related research in order to generate much-needed international public goods (IPGs) that will benefit resource-poor farmers. They also need to enhance regional coordination of R&D efforts on bioenergy in the Asia-Pacific region, encourage regional information sharing, and facilitate research networking and capacity building of NARES.

5. Public-sector research needs to ensure that technology advances made in the private sector ultimately benefit the poor in the developing world. This is particularly important for many second-generation biofuel technologies, which, for want of proper policies and IPR regime, may not be accessible to poor farmers in Asia. Public-private partnerships, being the key factor, will have to be established and promoted.

6. It is critical that scientists examine and share unbiased information on the life cycle performance and economics of bioenergy technologies, and their impact on food security and poverty. The social and environmental impacts of these technologies will also have to be assessed. This requires a standardized typology of food-feed-fiber-energy–producing agricultural systems as well as standardized methodologies for their integrated assessment.

7. Asian countries should consider the use of crop residues, especially rice and wheat straw, which are largely being burned in most countries. This is a priority area for R&D, particularly with regard to thermal conversion technologies for different scales and the level of residue retention, which may be needed for sustainable land use under different cropping systems.

8. Potential biofuel-producing countries in Asia should conduct their own national assessments critically and devise appropriate strategies to meet long-term bioenergy goals. APAARI and other regional/global organizations should devise strategies for the Bioenergy Revolution, and sensitize policymakers so that Asia-Pacific countries can reap the expected benefits.

9. The donor community should fund new R&D efforts on bioenergy, since the long-run benefits will lead to both poverty alleviation and protection of the environment – thus meeting two of the major Millennium Development Goals.

The International Rice Research Institute (IRRI) is the world’s leading rice research and training center. Based in the Philippines and with offices in 10 other Asian countries, it is an autonomous, nonprofit institution focused on improving the well-being of present and future generations of rice farmers and consumers, particularly those with low incomes, while preserving natural resources. IRRI is one of 15 centers funded through the Consultative Group on International Agricultural Research (CGIAR), an association of public and private donor agencies.

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Biomass 'more attractive' investment than wind

According to veteran energy reporter Matthew Wald all renewables have their pros and cons, without there being a clear favorite. Wald analysed the trade-offs associated with alternatives in Getting Power to the People [*.pdf], a special in-depth feature appearing in the September/October 2007 issue of the Bulletin of the Atomic Scientists.

However, Kurt Alen of Thenergo, a Belgian green energy firm, disagrees. Investors can expect to see more profit from biomass companies than they would from ploughing their capital into wind power and other renewables.

When it comes to reducing greenhouse gas emissions - a growing market with carbon emissions as a commodity - energy investors have four basic choices: either backing fossil fuels with all the future risks and uncertainties this entails (peak production, increasing prices, climate penalties); throwing their weight behind nuclear, which is being plagued by limited long term uranium supplies and the eternal waste problem; investing in carbon-neutral renewables like wind and solar; or backing energy concepts that fight climate change most effectively, namely carbon-negative bioenergy.

While wind has been a favoured alternative technology of the investment community, biomass is a more attractive prospect for several reasons. According to Alen, a lot of people understand the wind concept, but few understand biomass and its present and future advantages.

Biomass projects generate more profits than other renewables for two key reasons:
  • First, by partnering with the producers of the fuel - be they farmers, forests or facilities producing large quantities of organic waste - such schemes can ensure a steady supply of the fuel and a reliable market for the heat produced from CHP plants. In one of its projects Thenergo charges farmers a gate fee for unwanted manure, extracts the methane to produce power and then sells the residue back to the farmers as fertiliser. The biomass energy producer often gets paid for his raw materials. When waste is not available, biomass can always be traded physically and imported in an efficient and competitive manner.
  • The second advantage over wind is the operational time. Wind is an energy 'converter' whereas biomass is an 'energy carrier', which is a major advantage. Investors sometimes make the mistake of comparing potential schemes by the Megawatt, but fail to take into account that a 10MW wind park might produce less energy than a 3MW biomass plant because it would be running at a lower efficiency and would not use its full capacity - the wind does not always blow, whereas a well-run biomass facility is operational on a continuous basis.
Using these arguments, Alen showed that a €15million biomass might sell €4.1million of power per year, twice the value of the energy produced by an equivalent priced wind farm.

Carbon-negative energy and carbon credits
Added to this is the fact that in the medium to long term, biomass projects can be coupled to carbon capture and storage (CCS) technologies, resulting in carbon-negative energy production. Only biomass can achieve this. Wind power is carbon-neutral at best and only prevents a rise in atmospheric CO2 emissions in the future. Carbon-negative bioenergy on the contrary takes CO2 emissions from the past out of the atmosphere. With the prospect of CCS being included in carbon-trading schemes (earlier post), this gives carbon-negative biopower a strong advantage over other renewables:
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Thenergy attempts to maximise its profits through shrewd trading of certificates for green power production and selling its energy on the markets at the right time. But even without subsidy from certificates, alternative energy sources will soon be a viable business proposition, said Alen.

Thenergo is a leading European bioenergy company. Recently it launched a Belgian-Dutch partnership to develop a 5MW biocoal project in the Netherlands. The project will generate annually up to 42,800MWh of power and 75,000 tons of biocoal pellets. These pellets are made from thermally processed biomass either from dedicated energy crops or from wood debris, forest residue and chippings. This 'designer coal' can be burned in existing coal plants.

It also announced the development of a 3MW CHP biogas project in Flanders. The project will be operational for up to 8,000 hours per year, generating annually 24,000MWh of clean power, enough to supply around-the-clock electricity for up to 6,000 households. Feedstocks are locally sourced waste streams for which it gets paid.

Eurekalert: Trade-offs reveal no clear favorites in alternative energy market - September 11, 2007.

Wald, Matthew, "Getting power to the people"[*.pdf], Bulletin of the Atomic Scientists, Vol. 63, N° 5, September/October, 2007, pp. 26-43, DOI: 10.2968/D630D5008

Edie News Center: Biomass 'more attractive investment' than wind - August 31, 2007

Biopact: Carbon-negative energy gets boost as UNFCCC includes CCS in CDM mechanism - September 19, 2007.

Biopact: Thenergo to develop new 3MW CHP biogas project in Flanders - August 08, 2007

Biopact: Belgian-Dutch partnership to develop 5MW biocoal project - August 10, 2007

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Need for biofuel policies illustrated in Hungary, where opportunistic biomass harvesting amplifies drought

An interesting example of the need for strong policies and farming rules for biofuels comes from Hungary. Like many other countries in the EU, Hungary has suffered a drought, slashing its corn output by half. These droughts are responsible for an increase in food and biofuel feedstock prices (earlier post).

According to Szent Istvan University professor Marta Birkas, lack of precipitation is not the only cause of this drought in Hungary's maize areas: careless agricultural techniques, opportunistic biofuel production and burning agricultural by-products in power plants have amplified the situation's severity.

This year's dry weather would have had less impact on crops if farmers had left the maize plants' stalks and straw on the fields as protection from the sun and evaporation, instead of selling it as biomass.
There is plenty of biomass out there to burn and lots of fallow land to grow energy crops. I caution everyone not to sell [corn] straw and stalks to power plants. The soil needs it as a protection from drought. - Marta Birkas, Szent Istvan University professor
Like the professor says: there is enough land and biomass from other sources, so in theory biofuels as such are not the problem. What is problematic is the market-driven rush to cash in on the biofuel boom, which pushes farmers to disregard basic sustainability rules and which drives them to exploit resources where they can be gotten in the least costly way. The problem can be observed elsewhere.

Analysts from the IEA's Bioenergy Taskforces confirm that there is 'plenty of land out there' on a planetary basis (to be exact: more than enough to produce more energy from sustainable biofuels than the world's total energy use combined). But the best land is used first, and expansion into the very areas that would make biofuel production more sustainable, is more costly. Moreover, in the specific case of Hungary it must be said that corn is a crop that should be abandoned for biofuels production in any case, as the energy balance of maize-based fuel is very weak, as is its GHG reduction potential. It also requires heavy inputs of fertilizers.

Thus, strong policies are urgently needed to ensure a certain degree of sustainability. Biofuel makers in Hungary turn grains and oil seeds into gasoline and many burn farm byproducts to meet the often high energy needs of their plants for processes like fermentation. For this, they utilize resources that should be left on the field, especially when drought looms:
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Wrong farming methods, especially careless ploughing, also reduces the soil's ability to store water efficiently, Birkas said.

Ministry officials said Hungary would invest heavily in farm machinery and irrigation to address these problems as drought was becoming more frequent, hitting the major grain growing country for the fourth time in 10 years.

"Soil dryness has several causes, both lack of precipitation and wrong agricultural techniques," Agriculture Minister Jozsef Graf told Reuters.

Hungary needs to raise its irrigated area by at least 100,000 ha from about 80,000 hay, another official said.

This year's drought is expected to cut the maize crop by half to 4 million tones and Hungary has started buying back grain left in European Union stores from previous bumper seasons to sell to animal breeders short of feed.

Reuters: Biofuels worsen Hungary's drought, expert says - September 20, 2007.

Biopact: UN: biofuels not to blame for high food prices - September 14, 2007

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