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The dependence on foreign non-renewable sources of energy has been urging most countries to find paths to energy independence such as those that promote the expansion of biofuel production. The primary forces behind the continued surge in biofuel production and capacity expansion were a combination of blending mandates and tax subsidies in several countries, with strong support from agricultural interests. Many countries such as the USA, the United Kingdom, Japan, China, and the European Union (EU) have targeted to expand biofuel production and have enacted mandates for blending biofuels into vehicle fuels in the future. Consequently, the production of biofuel will increase consistently.
The Worldwatch Institute stated that global production of fuel ethanol derived primarily from sugar or starch crops increased 18 per cent to 46 billion litres in 2007, whereas production of biodiesel made from feedstock such as soy, rape and mustard seed, and palm and waste vegetable oils rose an estimated 33 per cent to 8 billion litres. This implies that the world production of biofuels in 2007 rose about 20 per cent to an estimated 54 billion litres or 1.5 per cent of the global supply of liquid fuels (Monfort, 2008).
The United States, which produces ethanol primarily from corn, and Brazil, which primarily uses sugar cane, account for 95 per cent of the world's ethanol production. Germany maintained its lead in biodiesel by increasing production capacity. Other European countries such as Austria, Belgium, Greece, Italy, the Netherlands, Poland, and Portugal also expand biodiesel production capacity (Monfort, 2008). Malaysia and Indonesia also seek to capture some proportions of biodiesel market by expanding their palm oil plantations.
In spite of the fact that the oil price in 2009 is much lower than that in 2008, it seems that biofuel production will continue developing. Biofuel development, however, has been criticized for its possible negative social, economic and environmental impacts. In this relation, it is worthwhile to present the key findings of the OPEC Fund for Internatinal Development (OFID) study prepared by IIASA (2009) as follows: First, factors that cause the increase in food price include increased demand for biofuels' feedstocks and rising agricultural fuel and fertilizer prices. Biofuel development scenarios indicate a strong relationship between agricultural prices and the share of first generation biofuels in total transport fuels. For example, with biofuel share of 4 per cent, the cereal price index increases by 20 per cent; with a 7 per cent biofuel target, the cereal price index increases by 40 per cent. Thus, biofuel development will seriously affect food security and this is a factor in rising hunger. Second, biofuel development absorbs cereal production. For different biofuel scenarios, about 66 per cent of cereal used for ethanol production in 2020 will be obtained from increased crop production, 24 per cent from reduced feed use and 10 per cent from reduced food use. Third, biofuel development provides modest benefits for rural development. The increase in agricultural value-added induced by first generation biofuel production is relatively small. Fourth, the net greenhouse gas savings resulting from expansion of biofuels can only be expected after 30 years. For shorter periods, net greenhouse gas balances are dominated by carbon debts due to direct and indirect land use changes. Fifth, the impact of biofuel development scenarios will be the increase in net expansion of cultivated land during 2000-2020 by 20-40 per cent. Sixth, biofuel development fuels deforestation. The analysis of biofuel development scenarios suggest that any prolonged dependence on the first generation biofuels will result in increased risk of deforestation with the inherent consequences of substantial carbon emissions and biodiversity loss.
Finally, the OFID study concluded that the development of second generation of biofuel using biomass residues from agricultural crops and forestry is imperative to minimize, if not to eliminate, the negative impacts of the first generation of biofuels. However, while the technology development of second generation of biofuels seems to take a relatively long period of time to be economically feasible, the development of first generation biofuels that can compete with fossil fuel and minimize the negative impacts remains necessary.
The International Water Management Institute (IWMI) stated that not only will the development of biofuel crops have impact on food, energy and the environment, but it also affects water use. In countries where water is already scarce, like India and China, growing biofuel crops will aggravate existing problems (IWMI, 2008). For this reason, it is necessary to find less thirsty crops such as jatropha and sweet sorghum which have much less impacts on food production and the environment than others. In the case of Indonesia, nyamplung (Callophylum inopilum) is another potential biofuel feedstock.
Written by Masdjidin Siregar, Consultant for Japan International Research Center for Agricultural Sciences (JIRCAS), Bogor, Indonesia.
(Reference available upon request) |
