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    A group of Spanish investors is building a new bioethanol plant in the western region of Extremadura that should be producing fuel from maize in 2009. Alcoholes Biocarburantes de Extremadura (Albiex) has already started work on the site near Badajoz and expects to spend €42/$59 million on the plant in the next two years. It will produce 110 million litres a year of bioethanol and 87 million kg of grain byproduct that can be used for animal feed. Europapress - September 28, 2007.

    Portuguese fuel company Prio SA and UK based FCL Biofuels have joined forces to launch the Portuguese consumer biodiesel brand, PrioBio, in the UK. PrioBio is scheduled to be available in the UK from 1st November. By the end of this year (2007), says FCL Biofuel, the partnership’s two biodiesel refineries will have a total capacity of 200,000 tonnes which will is set to grow to 400,000 tonnes by the end of 2010. Biofuel Review - September 27, 2007.

    According to Tarja Halonen, the Finnish president, one third of the value of all of Finland's exports consists of environmentally friendly technologies. Finland has invested in climate and energy technologies, particularly in combined heat and power production from biomass, bioenergy and wind power, the president said at the UN secretary-general's high-level event on climate change. Newroom Finland - September 25, 2007.

    Spanish engineering and energy company Abengoa says it had suspended bioethanol production at the biggest of its three Spanish plants because it was unprofitable. It cited high grain prices and uncertainty about the national market for ethanol. Earlier this year, the plant, located in Salamanca, ceased production for similar reasons. To Biopact this is yet another indication that biofuel production in the EU/US does not make sense and must be relocated to the Global South, where the biofuel can be produced competitively and sustainably, without relying on food crops. Reuters - September 24, 2007.

    The Midlands Consortium, comprised of the universities of Birmingham, Loughborough and Nottingham, is chosen to host Britain's new Energy Technologies Institute, a £1 billion national organisation which will aim to develop cleaner energies. University of Nottingham - September 21, 2007.

    The EGGER group, one of the leading European manufacturers of chipboard, MDF and OSB boards has begun work on installing a 50MW biomass boiler for its production site in Rion. The new furnace will recycle 60,000 tonnes of offcuts to be used in the new combined heat and power (CHP) station as an ecological fuel. The facility will reduce consumption of natural gas by 75%. IHB Network - September 21, 2007.

    Analysts fear that record oil prices will fuel general inflation in Kenya, particularly hitting the poorest hard. They call for the development of new policies and strategies to cope with sustained high oil prices. Such policies include alternative fuels like biofuels, conservation measures, and more investments in oil and gas exploration. The poor in Kenya are hit hardest by the sharp increase, because they spend most of their budget on fuel and transport. Furthermore, in oil intensive economies like Kenya, high oil prices push up prices for food and most other basic goods. All Africa - September 20, 2007.

    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.

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Saturday, September 29, 2007

Research finds recovery from acid rain much slower than expected

Acid rain emerged as a concern in the 1960s with observations of dying lakes and forest damage in northern Europe, the United States, and Canada. It was one of the first environmental issues to demonstrate a large-scale regional scope. The chief pollutants — oxides of sulfur (SOx) and nitrogen (NOx) from combustion of fossil fuels — can be carried hundreds of kilometers by winds before being washed out of the atmosphere in rain, fog, and snow. Acid rain kills plant life, destroys agriculture and forests, pollutes rivers and streams, and erodes stonework.

Over the last 20 years, serious action has been taken across Europe to clean up acid pollutants from power generation and industry, which was widely expected to bring recovery. However, new research led by Cardiff University's School of Biosciences shows that the expected improvements in rivers are far short of expectations.

The dissappointing findings are important for the developing world, and in particularly for Asia, where acid rain still is a major problem. There, energy consumption has surged and reliance on coal and oil remains very high. By 2020, Asian SO2 emissions could reach 110 million metric tons if no action is taken beyond current levels of control (graph, click to enlarge). As a result, damage to natural ecosystems and crops is likely to increase dramatically, at an enormous social and economic cost.

An example from India illustrates the dramatic effects of acid rain on agricultural productivity: researchers there found that wheat growing near a coal-fired power plant where SO2 deposition was almost five times greater than the critical load (the amount the soil can safely absorb without harm) suffered a 49 percent reduction in yield compared with wheat growing 22 kilometers away.

Damage could be largely avoided if modern pollution control technologies, such as flue-scrubbers, are widely adopted and if low-sulfur fuels are used. In this context, bioenergy and biofuels offer a major alternative to coal and oil. Co-firing low-sulfur biomass in power plants combined with a transition to 100% biomass power plants and biofuels in transportation can drastically reduce both SOx and NOx emissions.

From the Cardiff University scientists we learn that these efforts are urgent, because ecosystem recovery from acid rain takes much longer than expected. Recent studies in Galloway, the Scottish Highlands and Wales reveal that many streams are still highly acidified, decades after the first pollution control measures came into effect. Biological recovery has been particularly poor.

Key findings from the projects, carried out by combined teams from Cardiff University, the Centre for Ecology & Hydrology and National Museum Wales, include:
:: :: :: :: :: :: :: :: ::

  • Acidity in Welsh headwaters is declining, but only slowly
  • More than two thirds of all streams sampled were acid enough during high flow to cause biological damage, with metals at toxic concentrations
  • Sulphur pollution from man-made sources is still an important cause of acid episodes, particularly in Wales
  • Sensitive insects survive conditions in the most acid streams for only a few days
  • Headwater acidification is still a significant problem for important salmon fisheries, and Special Areas of Conservation such as the Welsh River Wye.
Professor Steve Ormerod of the School of Biosciences, a leading researcher into the biological effects of acid rain for more than 20 years, said: "Organisms and ecosystems are the best indicators of recovery from pollution, so these results will alarm anyone interested in the well-being of our rivers. We need to understand the factors responsible for such delayed recovery, particularly since climate change is likely to make the acidification problem even worse."

Dr Chris Evans, an acid-rain specialist from the Centre for Ecology & Hydrology in Bangor, added "pollution reductions are slowly improving in upland waters, but there is a long way to go. The large biological effects of acid episodes shown by this work mean that it is vital to continue monitoring these ecosystems if we are to protect them in future."

The research contrasts with other recent studies which showed some encouraging early signs and will come as disappointing news to those who thought the acid rain problem was solved.

Graph credit: World Resources Institute.

Eurekalert: Recovery from acid rain 'much slower than expected' - September 28, 2007.

World Resources Institute: Acid Rain: Downpour in Asia.

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The Seven Commandments of Mexican biofuels: from social justice to sustainability

In a very interesting essay Ricardo Cantú of Mexico's School of Public and Political Administration at Monterey's Technological University explores how one might go about creating a sustainable ethanol economy that simultaneously serves the interests of social justice, the environment, and energy security, in the context of Mexico. A project much like that of the Biopact, focused on Sub-Saharan Africa.

The overriding goal emerging from Cantú's excellent paper titled "Ethanolomics: The Think-About's of the Mexican Ethanol Project" [*.pdf] is to devise a strategy for improving the living standards of the rural poor in Mexico via an invigoration of the agricultural economy, boosting energy security for the population at large while limiting the catastrophic effects of high oil prices on the poor, and contributing to the fight against climate change by producing fuels that effectively reduce carbon emissions.

In theory, biofuels "could potentially [...] solve all of the above problems" writes Cantú, an argument voiced by many biofuel proponents in the Global South (and partially by organisations like the FAO, the WorldWatch Institute and the IEA). Plant based alternatives to oil could:
diminish the global ecological harm that the fossil fuels are making; lessen the economical dependence of some countries with the global markets and foreign policies [...]; be a renewable energy source, because it would use biomass inputs; and power up rural economical dynamism.
But this is theory. The same theory set out in our 'Biofuels Manifesto'. In reality, biofuels can go two ways: either perpetuating social injustices, concentrating power in an ever smaller number of hands, and damaging the environment, or they can become an engine for poverty alleviation, rural revival, a healthier environment, reduce hunger and bring global social justice. In order to make sure biofuels take the latter path, Cantú provides a set of ground rules. It won't be easy to follow them, but it is not impossible either. The guidelines are:
:: :: :: :: :: :: :: :: :: :: ::

  1. Over the whole chain, the use of biomass should produce fewer emissions of greenhouse gases net than on average with fossil fuel.
  2. Production of biomass for energy must not endanger the food supply and other local applications (such as for medicines or building materials).
  3. Biomass production must not affect protected or vulnerable biodiversity and will, where possible, have to strengthen biodiversity.
  4. In the production and processing of biomass, the quality of soil, surface and ground water and air must be retained or even increased.
  5. The production of biomass must contribute towards local prosperity.
  6. The production of biomass must contribute towards the social well being of the employees and the local population.
  7. The overall ethanol production costs should be cheaper and more accessible than that of the fossil fuels, or at least the same level, excluding all the subsidies or tax benefits to the producers or distributors.
That's quite a checklist. Over at Salon, Andrew Leonard, in his typically succinct and sharp way, picks one of these to see what it really means: The production of biomass must contribute towards local prosperity.

Cantú stresses that a key requirement of a biofuel economy in Mexico is that the farmers capture the rewards of their production. In other words, one wants to avoid a situation in which farmers sell their sugar cane or maize or sorghum at rock-bottom prices to middlemen who then grab all the upstream profits. Cantú envisions farmer cooperatives setting up their own ethanol mills, and dealing directly with distributors.

Such a model is not uncommon in the U.S. and in Europe, and there's no reason, in principle, it couldn't work in Mexico or in other developing countries, says Leonard. But it would require strong government leadership and the sharp eye of civil society organisations to check whether policies are enacted.

Indeed, to achieve all the goals outlined above would require a tightly regulated market with significant government intervention: in other words, a direct repudiation of the kind of Washington Consensus policies of deregulation and privatization that the West has been pushing on Latin America and elsewhere for decades.

Ricardo Cantú, "Ethanolomics: The Think-About’s of the Mexican Ethanol Project" [*.pdf], Cátedra de Integración Económica y Desarrollo Social, Escuela de Graduados en Administración Pública y Politica Pública, Tecnológico de Monterrey, Working Paper No. 2007-3.

Salon: The Seven Commandments of Mexican ethanol - September 28, 2007.

Biopact: Worldwatch Institute chief: biofuels could end global malnourishment - August 23, 2007

Biopact: FAO chief calls for a 'Biopact' between the North and the South - August 15, 2007

Biopact: IEA report: bioenergy can meet 20 to 50% of world's future energy demand - September 12, 2007

Biopact: High oil prices disastrous for developing countries - September 12, 2007

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Malaysia to trial jatropha in Sabah - replicating palm oil's poverty reduction power?

The palm oil industry is a corner stone of Malaysia's economy, generating export revenues only surpassed by oil and gas. It has become politically incorrect to say this, but over the past decades the sector has brought unprecedented wealth to hundreds of thousands of small farmers. Small holders retain a 41% share of the hectarage in the sector. The incidence of small holder poverty has dropped from 30% in the 1970s to nearly zero today, a stronger reduction than observed in any other agricultural segment. According to an analysis of the sector presented to an UNCTAD workshop:
the government of Malaysia, though its poverty redressal programs, in particular the organized smallholder programs involving oil palm, has been able to enhance the incomes of agricultural smallholders and lifted them from the vicious cycle of poverty.
Today, these strong social arguments in favor of palm oil have been clouded by environmental worries. Deforestation resulting from expanding plantations could carry a cost higher than the direct social and economic benefits from palm oil. Environmental economists are still studying the matter, but as things stand today, it may be more sensible to keep forests intact as carbon sinks, and compensate the farmers for doing so. However, the threat of ever rising oil prices may make this proposition untenable in the long run. With oil at a record $80 per barrel and rising, palm based biofuels may become more commercially attractive than the carbon value of forests.

Recently, two scientists writing in Nature urged conservationists to forget the idea of compensated reduction - which is a top-down, bureaucratic scheme unlikely to reach the small holders who need the money most - and instead suggested they should become palm oil farmers themselves. With the profits made from the plantations, conservationists could then buy forests to keep them intact (earlier post). To some the idea sounded bizarre ('join the enemy, to beat him') but it clearly illustrates the tension between direct socio-economic benefits from palm oil and more abstact benefits from environmental goods and services embodied in intact forests.

Malaysia is accutely aware of this tension, which has prompted it to show interest in diversifying its portfolio of biofuel crops by looking into Jatropha curcas. The shrub has been touted as an alternative to the large oil crops because it can be grown on poor soils, with limited inputs, away from forests.

The country's Plantation Industries and Commodities Ministry will therefor launch a pilot project in Kota Marudu in northern Sabah (map, click to enlarge) to cultivate jatropha, whose seeds contain up to 40 percent oil. Should the project prove to be viable, commercial cultivation of the plant will be carried out in the state, minister Datuk Peter Chin Fah Kui says.

But despite the environmental arguments in favor of jatropha, the same social logic which drove the government's efforts in the palm oil industry is still at work. After a dialogue with small holders in the region, the minister said:
We need to study the suitability of the [jatropha] crop in terms of soil and weather, and we chose Kota Marudu for the pilot project on the request of its MP, Datuk Dr Maximus Ongkili, as the area is among the least developed in Sabah, and we must do something to improve the lot of the people in the constituency.
Could jatropha replicate the poverty alleviating power of palm oil, while at the same time avoiding the environmental problems associated with palms?
:: :: :: :: :: :: :: :: :: ::

Chin thinks so and hopes smallholders, especially those in Kota Marudu, will participate in the cultivation "as it is sure to provide good returns". The ministry regards jatropha as an alternative crop that could contribute to the production of biodiesel in Malaysia with the potential to become a full-blown commercial crop.

However, the question remains on what type of land the jatropha will be grown and what its effects will be on land competition and on indirect pressures on forests.

If the crop is planned on land that would be suitable for palm oil, it will be difficult to convince farmers to grow it, since jatropha can't compete qua productivity and is extremely labor intensive (earlier post). On the other hand, of marginal interest may be the role jatropha could play in crop diversification. Small farmers who produce for a market that is heavily dependent on global market forces often face strong price fluctuations, and thus often stand to benefit from a diversified crop portfolio.

The strongest arguments in favor of jatropha - the fact that it can be grown on marginal soils and in semi-arid environments requiring little inputs of water - probably don't make sensee in Sabah. After all, Sabah is a heavily forested, lush green region in Borneo, the largest island in the humid tropics. The extent of 'marginal' soils there is probably limited.

On oil palm cultivation in Sabah, Chin added the federal government will continue to support the sector in the state with the use of new methods including quality seedlings. And here too, the support schemes are directed at small holders, the traditional recipients of financial and agro-technical aid:
We want to ensure that it is not only the large plantations that benefit from the latest methods but also the smallholders, which is why we have the quality seedlings aid scheme
In recent years, improved palms have been developed with some cultivars showing a 30% increase in yield. In order to arrive at a more sustainable palm oil sector, it is crucial for small holders to have access to these cultivars, so that replanting opens a cycle of higher productivity.

In another development, Chin said his ministry will introduce a new system that saves time for rubber tappers. If the smallholders use the new method, which involves gas and chemical extraction techniques, they will only need to tap 11 days a month, but the latex they collect will be equivalent to the amount from tapping daily, he explained.

Some environmentalists from the West have done their best to discredit Malaysia's plantation sector as a whole. One of their strategies has been to focus on the large estates as if they are the only actors in the industry. Too often they gloss over the fact that millions of people derive their livelihoods from the sector and that it has had profoundly beneficial social effects for Malaysia's rural population. If managed well, the biofuel market is set to bring more wealth to the small holders once again.


Bernama: Biofuel Crop Jatropha To Be Cultivated In Sabah - September 28, 2007.

Arif Simeh, "The Case Study on the Malaysian Palm Oil" [*.pdf], Regional workshop on commodity export diversification and poverty reductionin South and South-East Asia (Bangkok, 2001), UNCTAD.

Biopact: Jobs per joule: how much employment does each energy sector generate? - September 01, 2006

Biopact: Towards a truce: environmentalists should use palm oil as a lever for conservation - September 03, 2007

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