Biofuel For Transport

 

BIOFUELS FOR TRANSPORTATION Global Potential and Implications for Sustainable Agriculture and Energy in the 21st Century

— Su Summ mmar aryy —  June 2006

 

Acknowledgments Sponsor 

German Federal Ministry of Food, Agriculture and Consumer Protection (BMELV) Collaborating Agencies

German Agency for Technical Cooperation (GTZ) German Agency of Renewable Resources (FNR) Producer and Publisher 

Worldwatch Institute Lisa Mastny, Editor  Project Manager 

Suzanne C. Hunt, Worldwatch Institute Lead Researchers and Contributors

Jim Easterly, Easterly Consulting

Jose Moreira, Moreira, Brazilian Reference Reference Center on Biomass

Andre Faaij, Flavin, UtrechtWorldwatch University Institute Christopher Ladeene Freimuth, Freimuth Consulting Uwe Fritsche, Öko-Institut Mark Laser, Dartmouth College Lee Lynd, Dartmouth College

Sergio of São Paulo Janet L.Pacca, Sawin,University Worldwatch Institute Lauren Sorkin, Worldwatch Institute Peter Stair, Worldwatch Institute Alfred Szwarc, ADS Technology and Sustainable Development Sergio Trindade, SE2T International, Ltd.

Other Contributors: Thanks to the following people for contributing time, materials, and/or review comments: Don Abraham (Social Technologies); Technologies); Clayton A Adams; dams; Carsten Agert (Fraunhofer (Fraunhofer-Institut -Institut für Solare Energiesysteme); Weber Amaral (Brazilian Biofuels Programme); Robert Anex (Iowa State University); Eliana Antoneli (Brazilian Biofuels Programme); Daniel Aronson (Petrobras); Dirk Assmann (GTZ); Sergio Barros (U.S. Department of Agriculture-USDA); Christoph Berg (F.O. Licht); Göran Berndes (Chalmers University of Technology); Davis Bookhart (Charm21); Barbara Bramble (National Wildlife Federation-NWF); Thomas Breuer (University of Bonn); Steve Brisby (California Air Resources Board); Neil Brown (U.S. Senate Committee on Foreign Relations); Robert Brown (Iowa State Bioeconomy Initiative); William Burnquist (Centro de Tecnologia Copersucar-CTC); Copersucar-CTC); Heloisa Burnquist (University of São Paulo); Jake Caldwell (Center for American Progress); Matt Carr (Biotechnology Industry OrganizationBIO); Eduardo Carvalho (União da Agroindústria Canavieira de São Paulo-UNICA); Frank Casey (Defenders of Wildlife); Christine Clashausen (GTZ); Suani Teixeira Coelho (Regional Government of São Paolo); Ana Unruh Cohen (Center for American Progress); Daniel de La To Torre rre Ugarte (University of Tennessee); Aimee Delach (Defenders of Wildlife); Mark A. Delucchi (University of California, Davis); Neeraj Doshi (Tufts Fletcher School of Law and Diplomacy); Reid Detchon (Energy Future Coalition); Brent Erickson (BIO); Emanuel Filho (Petrobras); Elke Foerster (GTZ); Hilary French (Worldwatch Institute); Lew Fulton (U.N. Environment Programme); Rubens Gama (Brazilian Embassy); Jana Gastellum (Energy Future Coalition); Simon Godwin (DaimlerChrysler); Alex Goyes (International Food & Agricultural Trade Policy Council-IPC); Nathanael Greene (Natural Resources Defense Council-NRDC); Ralph Groschen (Minnesota Department of Agriculture); Kathleen Hadley (National Center for Appropriate Technology); Technology); Brian Halweil (Worldwatch Institute); Charlotte Hebebrand (IPC); Russel Heisner (BC International); Jan Henke (Institute for World Economics); Christian Henkes (GTZ); Chris Herman (U.S. Environmental Protection Agency); Bill Holmberg (American Council on Renewable Energy); Monique Hoogwijk (Ecofys); Rob Howse (University of Michigan); Roland Hwang (NRDC); Paul Joffe (NWF); Francis Johnson (Stockholm Environment Institute); John Karhnak (Raytheon UTD); Dennis Keeney (Institute for Agriculture and Trade Policy-IATP); Policy-IATP); Birger Kerckow (FNR); Jim Kleinschmidt (IATP); Ricardo Külheim (GTZ); Regis Verde Leal (University of Campinas); Deron Lovaas (NRDC); Warren Mabee (International Energy Agency-IEA); James Martin (Omnitech International); I nternational); Joseph Mead (World Energy Alternatives); Rogerio Miranda (Winrock International); Ian Monroe (Winrock International); David Morris (Institute of Local Self-Reliance); Danielle Nierenberg (Worldwatch Institute); Peter O'Connor; Leslie Parker (Renewable Energy and International Law Project); Sillas Oliva Filho (Petrobras); Luiz Prado (LaGuardia Foundation); Luke Pustevjosky (Fieldstone Private Capital Group); Guido Reinhardt (IFEU Institute); Michael Renner (Worldwatch Institute); Fernando Ribeiro (São Paulo Sugar Cane Agroindustry Union); Thereza Rochelle (Brazilian Biofuels Programme); Rodrigo Rodrigues (Brazilian Ministry of Agriculture); Ian Monroe (Winrock International); Friederike Rother (GTZ); Katja Rottmann (Worldwatch Institute); Larry Russo (U.S. Department of Energy); Liane Schalatek (Heinrich Böll Foundation); Hosein Shapouri (USDA); Ralph Simms (Massey University); Edward Smeets (Utrecht University); Ron Steenblik (International Institute for Sustainable Development); Steve Suppan (IATP); Freyr Sverrisson (Energy Consultant); Holger Thamm (Office of Angelika Brunkhorst, Member of German Parliament); Ibrahim Togola (Mali-Folkecenter); (Mali-Folkecenter); Boris Utria (World Bank); Friedrich Wacker (German Embassy); Michael Wang (Argonne National Laboratory); David Waskow (Friends of the Earth); Carol Werner (Environmental and Energy Study Institute); Jetta Wong (Environmental and Energy Study Institute). B I O F U E L S

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BIOFUELS FOR TRANSPORTATION

A Booming Industry

recent years are China, recent China, Col Colombi ombia, a, Indi India, a, the Phi Philiplippines, and Thail Thailand. and. The Swedish Swedish government government has vowed to end the country’s dependence on fossil fuels by 2020, with biofuels slated to play a major role. role. Among the companies that have Figure 1. World Fuel Ethanol Production, 1975–2005 announced signifi40,000 cant new invest-

The world is on on the verge of of unprecedented growth in the production production and use of biofuels (liquid fuels derived from plants and other other biomass). Rising oil prices, national security concerns, concerns, the desire to increase incr ease farm inco incomes, mes, and a host host of new and and improved technologies are propelling many governments to enact powerful incentives incentives for the production and use of of these fuels. This, in tturn, urn, is sp sparkin arkingg a large new wave of investment. The two most most prevalent biofuels biofuels are ethanol, currently produced produced from sugar or starch crops, and biodiesel, produced from from vegetable oils or animal fats. World pro production duction o off ethanol more more than doubled between 2000 and and 2005 2005,, while p production roduction of biodiesel quadrupled. (See Figures 1 and 2.) 2.) In 2005 alone, ethanol production production rose 19 percent and biobiodiesel production jumped 60 percent (starting from a much smaller base). In total, total, biofuels now now provide provide 1 percent of the world’s world’s liquid transport fuels. Brazil and the United States together account for 90 percent of the world percent world’s ’s fuel ethan ethanol ol production, production, thanks to strong government support that began in the 1970s. (See Table Table 1.) In Brazil, ethanol derived from sugar cane claims 40 percent percent of the light fuels market market and has helped the country end its dependence on imported oil. In the the much larger U.S. fuels market, market, ethanol ethanol derived mainly from corn now makes up 2 percent of  the total light fuel supply supply.. The European European Union, Union, and Germany in particular, dominates world biodiesel production and use. (See Table Table 2.) As oil prices and environmental concerns have risen in the past few years, investmen investmentt in new biofuel facilities has mushroomed mushroomed in Brazil, Brazil, Europe, the United States, and elsewhere. elsewhere. Among the countries countries that have made major commitments to biofuels in

30,000 ments in biofuels    s are Archer Daniels    r    e    t     i     L Midland, Midl and, Cargi Cargill, ll,    n20,000    o     i     l     l     i DaimlerChrysler,     M Dupont, Dupon t, and Shell. Shell. 10,000 Major investors in Source: Christoph Berg  biofuels include 0 1975 1980 1985 1990 1995 19 2 000 20 2005 20 Richard Branson, Bill Gates, Vinod Khosla, Khos la, and most most Figure 2. World Biodiesel Production, 1975–2005 4,000 recently,, the global recently investmentt firm investmen 3,000 Goldman Sachs.    s    r And several leading    e    t     i     L    n2,000 automakers, includ   o     i     l     l     i ing Ford, Ford, General General     M Motors Mo tors,, and 1,000 Volkswagen, have Source: F.O. Licht  0 announced plans to 1975 1980 1985 1990 1995 19 2 000 20 2005 20 dramatically increase productio prod uction n of flexiflexible-fuel vehicles that can run on varying blends of  ethanol and gasoline.  

The Promise of New Technologies Biofuel production has become substantially more efficient over the last 25 years as Brazil and the

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United States have scaled up their industries. In the U.S., U.S., ethanol ethanol from corn corn is now competitive competitive with gasoline, gasoline, while in Brazil sugar cane ethanol is far less expensive than gasoline. gasoline. (See Figure 3.) Such Such incremental gains are likely to continue for years to come. come. However, However, the greatest potential for biofuels lies in the development of new technologies technologies that will significantly expand the range of biomass feedstock, increase conv conversion ersion efficiencies, and lower production costs. One of the innovations innovations expected to dramatically boost biofuel production is the ability to generate the fuels from cellulosic materials such as plant stalks, leaves, leav es, and wood. This includes includes producing producing ethanol ethan ol thr through ough the the use of enzym enzymes, es, and synthetic diesel via a gasification/FischerTropsch process pioneered in Germany  and South Africa. These techn technologies, ologies,

use. If com combined bined with greatly greatly increased increased vehicle vehicle fuel economy, econom y, strengthened public transportation, and new automotive technologies technologies such as plug-in hybrids, biofuels can play a central role in building a sustainable transportation sector. sector. A recent joint joint study by the U.S. U.S. Departments of  Agriculture and Energy found that advanced biofuels could substitute for 37 percent of U.S. transport fuel use within the next 25 years, with the figure rising to 75 percent percent if vehicle fuel economy economy is doubled. The biofuel potential in Europe is estimated to be in the range of 20–25 20–25 percen percent, t, even assuming assuming tha thatt strict sustainability criteria are used for land use and crop choice and that bioenergy use in non-transport sectors grows in parallel. Many small developing developing countries with favorable growing climates could likely  meet all of their liquid fuel needs with biofuels. The yields of currently used biofuel feedstock feedstock vary  widely.. (See Figure 4.) The efficiency of the converwidely conversion process process and the availability of of suitable land and water resources for biofuel production will be the

which are still relatively relatively expensive, are close to being introduced commercially commercially and will make it possible to create liquid fuels from agricultural, municipal, and forestry wastes, as well as from non-food non-food perennial perennial crops such as Figure 3. Cost Ranges for Ethanol and switchgrass that Gasoline Production, 2006 can be grown on Ethanol from Source: IEA, Reuters, DOE  degraded lands sugar cane, Brazil with modest water Ethanol from corn, U.S. and fertilizer Gasoline, requirements. wholesale New biofuel Ethanol from grain, EU technologies have Ethanol from attracted substantial cellulose government R&D $ 0. 0.00 $0.25 $0 .5 .50 $0.75 $1.00 $1.25 Dollars Per Liter Gasoline Equivalent investment and are now becoming a hot investment area for the venture capital community in Silicon Valley and beyond. As a result, technological progress is likely to accelerate in the years immediately ahead.

primary limitations to the future contribution of  these fuels. Among the potential potential challenges that will need to be addressed as markets expand are growing competition for for land and water resources, aquifer depletion deple tion,, soil er erosio osion, n, and the loss loss of biologic biologically  ally  rich ecosystems, ecosystems, including tropical forests. PolicyPolicymakers will also need to keep an eye on the potential for biofuels to drive drive up food prices, a trend that could be beneficial to farmers but could also make it more difficult to meet the food needs of the urban poor. poor.

Table 1. Top Five Fuel Ethanol Producers in 2005 (million liters)

Brazil United States China European Union India

16,500 16,230 2,000 950 300

 

Source: Christoph Berg

Table 2. Top Five Biodiesel Producers in 2005 (million liters)

Germany France United States Italy Austria

1,920 511 290 227 83

Source: F. O. Licht

How “Green” Are Biofuels? One of the great promis promises es of biofuels biofuels is their their potenpoten-

Policymakers around the world are asking how large Policymakers a share of the world’s world’s liquid fuel supply can be pro-

tial to provide an a n environmentally sustainable alternative to the petroleum fuels that have exacted such a heavy toll on the planet. planet. Biofuels do have have the ability  to reduce pollution, pollution, but they can also exacerbate exacerbate a range of of other environmental environmental p problems roblems if not developed carefully. Biofuels are essentially a way to convert convert solar energy into liquid liquid form via photosynt photosynthesis hesis.. One of the greatest concerns concerns raised about them, however, however, is their net energy balance—i. balance—i.e., e., whet whether her production production of the fuels requires more energy inputs (particularly fossil energy,, in th energy thee form form of fertilizer fertilizers, s, tracto tractorr fuel, fuel, processprocess-

vided by biofuels. While no definitive definitive answer is yet possible, there is no doubt doubt that these fuels could could potentially account account for a significant significant share of total fuel

ing energy, energy, etc.) than is ultimately co contained ntained in the biofuels themselves. Advances in technology technology have improved production production efficiency, efficiency, giving all current

How Large is the Potential?

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biofuels a positive fossil energy energy balance. (See Table Table 3.) Not only is the efficiency efficiency of the conversion conversion process advancing steadily, steadily, but bioenergy is increasingly  increasingly  being used for feedstock feedstock processing processing as well. Both approaches reduce reduce the amount of fossil fuels used to convert conv ert crops into biofuels. Transportation is responsible for 25 percent percent of the world’ss greenhouse gas (GHG) emissions, and this world’ share is rising. Biofuels have have the potential to significantly reduce GHG emissions, particularly with the development of advanced bio biomass mass technologies technologies that rely on agricultural wastes and cellulosic crops such as switchgrass. switchgrass. (See Figure Figure 5.) If cultivated cultivated in the right way, way, these crops can actually actually sequester carbon in the soil, helping to reduce reduce the amount in the atmosphere atmosp here.. Howev However er,, if biofuels biofuels are produced produced from low-yielding crops, grown with heavy heavy inputs inputs of fossil energy on previously wild grasslands or forests, and/or processed into into fuel using fossil energy energy,, they  have the potential to generate as much or more GHG emissions than petroleum fuels do. Blending biofuels with petroleum fuels generally  brings a reduction in vehicle vehicle emissio emissions ns of sulfur, sulfur, particulates, and carbon carbon monoxide. monoxide. In dev developing eloping countries, ethanol and biodiesel biodiesel could play a signifisignificant role in improving urban air quality and helping to phase out lead-based and otherwise toxic fuel additives. One of the risks risks of biofuels biofuels is the potentia potentiall for fuel crops to be grown on on ecologically fragile lands, accelerating soil soil erosion erosion an and d the depletion of aquifers. In addition, biofuel crops could destroy some of the world’ss remaining tropical ecosystems, home to vast world’ treasures of biodiversity. biodiversity. Ecologists point with alarm

expansion of biofuel producTable 3. Fossil Energy Balances tion will need to be accomof Selected Fuel Types panied by a new generation Fossil Fuel Energy of strict land-use land-use laws, laws, par(feedstock) Balance ticularly in countries with Cellulosic ethanol 2–36 2– 36 tropical forests that are at Biodiesel (palm oil) ~9 risk of of destru destruction ction.. Ethanol (sugar cane) ~8 The experien experience ce of the Biodi iodies esel el (w (was aste te veget egetab able le oil) oil) 5–6 Biodiesel (soybeans) ~3 world’s leading biofuel proBiodiesel (rapeseed, EU) ~ 2.5 ducers has shown that in the Ethanol (wheat, sugar beets) ~2 absence absen ce of stro strong, ng, well well-Ethanol (corn) ~1.5 Diesel (crude oil) 0.8 – 0.9 implemented policies, enviGasoline (crude oil) 0.8 ronmental degradation and Gasoline (tar sands) ~ 0.75 social conflicts can result. Note: Figures represent the amount of energy conGovernmental Government al policy decitained in the listed fuel per unit of fossil fuel input. The ratios for cellulosic biofuels are theoretical. sions, and the resolve resolve to see For sources, see full report. them properly enacted, are therefore critical in determining the the net ecological ecological impacts of biofuels.

A New Future for Rural Communities? Another promise Another promise of biofuels— biofuels—and and one one of the main main political engines behind them—is their potential to increase farm incomes and strengthen rural economies. econo mies. The ability to grow eenergy nergy crops in addition to food and fiber crops could transform agriculture more profoundly than any development since the green revolution. The dispersed nature of agriculture makes makes it unlikely that biofuel production will become as cen-

Figure 4. Biofuel Yields of Selected Ethanol and Biodiesel Feedstock 7,000 Source: Fulton et al.

to the massive Brazilian soybean crop that is encroaching on the out outer er fringes of the Amazon Amazon Basin.. While Basin While most of this crop crop is currentl currentlyy used as cattle  feed, soybeans are co considered nsidered a significant significant potential pote ntial biodiesel biodiesel source. source. Large Large-scale -scale use of palm oil, the most economic economical al feedstock for biodiesel today,, could lead today lead to similar problems: problems: tropical forests in southeast Asia have already been cleared to make room for palm plantations, plantations, mainly as a source for cooking oil. Once technology allows for more widespread production ducti on of biof biofuels uels from from grasses and tre trees, es, these

tralized as the oil industry. How However, ever, as biofuels become a major commodity commodity,, larger farms and

perennial crops could be used to protect lands that are vulnerable to erosion and to restore lands degraded by grazing. grazing. For such benefits to to be realized, realized, the

agribusinesses will play a growing growing role. Agricultural resources are unevenly distributed in many countries, and the ability of small farmers to benefit from bio-

6,000

Ethanol Feedstock

   e    r 5,000    a    t    c    e     H4,000    r    e     P3,000    s    r    e    t     i     L2,000

Biodiesel Feedstock

1,000 0

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Barl Ba rley ey Wheat Wheat Co Corn rn

F O R

Sugarr Sugar Soybean Castor Sunflower Rape- Jatropha   Palm Suga Beet Cane Beans Seed seed Oil

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fuels will be determined in part by broader decisions about land reform refo rm and tax polici policies. es. If smaller-scale production is to be nurtured as a way of distributing the economic benefits of biofuels, government policies will be needed to encourage this. The production production of biofuels biofuels has already begun to affect agricultural commodity markets. About 50 percent of of Brazil’s Brazil’s sugar cane crop was dedicated to producing ethanol ethanol in 2005, and this demand has helped drive up the price price of sugar world worldwide. wide. In The global transport sector generates onethe United United States, an estimated quarter of the world’s energy-related green15 percent of the corn crop was house gases. used to produce ethanol in 2005, and in 2006 the the volume of of corn used for ethanol ethanol is expected to equal total U.S. corn exports. exports. In the European Union, Union, more than 20 percent percent of the rape-

widely the benefits are shared will depend in part on whether farmers and and producers of forestry materials own portions of of the biofuel processing processing and distribution industry (e.g. via co-ops or other other ownership structures). Re-circulating biofuel revenues revenues in the local economy can maximize the economic benefits of shifting away away from imported fuels. In countries and regions where access to modern forms of energy is limited limited or absent absent,, governme government nt and development agency support for small-scale biofuel production can help provide clean, clean, accessible energy  that is vital for rural development and poverty alleviation, helping to achieve the Un United ited Nations’ Millennium Development Goals.

Energy Security and Trade The world’s current transportation systems are highly  dependent on petroleum, petroleum, a resource that is concenconcentrated in relatively relatively few countries. This has left the globall economy globa economy at risk of disrup disruption tion,, partic particularly  ularly  with oil supplies as tight as they are now. now. Biofuels

seed crop was tapped to provide about 1 percent of  EU transport fuel in the form form of biodiesel in 2005 2005.. As a refined product, product, biofuels can add value value to raw  agricultural goods. The biofuel industry has already  become an engine of economic development and job creation in south-central south-central Brazil and the U.S. U.S. Midwest. The ethanol industry is credited with directly providing nearly 200,000 jobs in the United States and half  a million jobs in Brazil. These benefits are now likely  likely 

promise to bring a much broader broader group of countries into the liquid liquid fuel business, diversifying supplies supplies and reducing reduc ing the risk of disruption disruption.. And becau because se biofuels biofuels can be produced produced in most most regions regions of the glob globe, e, the risks inherent in transporting fuel over long distances will also be reduced. Of the wo world’s rld’s 47 poorest poorest countries, 38 are net oil importers, impo rters, and 25 of these import import all of their their oil. oil. In many smaller and poorer nations, nations, 90 percent or mor moree of the total energy used comes comes from imported imported fossil fuels.. In some fuels some cases, cases, a large large share share of the foreign foreign exchange earnings earnings goes to pay for oil, and much of  the government revenue is used to subsidize kerosene and diesel fuel. Yet many of these same countries have substantial agricultural bases and are well suited to growing growing sugar cane, palm oil, and other highly  producti prod uctive ve energy crops. crops. Some of these countries countries even have the potential to become net exporters of  liquid fuels. International trade in biofuels is currently limited by the fact that many countries maintain tariffs on these fuels, both to protect protect their domestic industries industries and to assure that their substantial domestic subsidies are not used to support support the industries of other nations. (See Figure 6.) This is likely likely to change in the

to spread internationally, internationally, with the greatest impact occurring in agriculturally based economies with favorable conditions conditions for growing biofuel crops. crops. How 

 years ahead. Many Many of the rich coun countries tries that consume consume large quantities quantities of transportation transportation fuels (in Europe Europe and Japan, for example) hav havee limited land available for

Figure 5. Potential Reductions in GHG Emissions, by Feedstock Type    r 120    e    t    t    n   e    e   m 100     l    o    a    l    v    i     i    u    K      q   e     ) 80     E    l    c     2     i    t     h   n     O    e   e    c     C    V    r 60    n   r    e     i    p    e     (    n    P 40    o   s     i    t    n    c   o    u    i     d   s 20    e   s     R    i    m     E 0

Source: IEA

Fibers (switchgrass, poplar)

4

Wastes Sugars Vegetable Oils Starches (waste oil, (sugar cane, (rapeseed, (corn, harvest, sugar beet) sunflower wheat) residues, seed, sewage) soybeans)

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growing biomass feedstock, which leaves growing leaves them unable to generate generate more than a fraction of of their transportation fuels from domestically produced biofuels. Some countries may decide to eliminate biofuel tariffs on a bilateral basis with individual trading partners. partner s. The U Unite nited d States, States, for example, example, already  already  allows the preferential preferential import of of ethanol from from the Caribbean. And Sweden has has indicated that it wants to encourage large-scale biofuel biofuel imports. Ongoing negotiations at the World World Trade Trade Organization, aimed at liberalizing trade in agricultural commodities, are expected to address the potential for reducing biofuel trade barriers, offering an opportunity for for countries to generate new agricultural revenue streams to offset the loss loss of of trade-distorting subsidies.

Policy Recommendations For biofuels to make a large and sustainable contribution to the world energy economy, economy, governmen governments ts will need to enact consistent consistent,, long-range, and coordicoordinated policies that are informed by broad stakeholder participation. Policy Policy priorities iinclude: nclude: • Strengthen the Market. Biofuel policies should focus on market development, development, creating an enabling environment environ ment based on sound fiscal policy and support for private investment, investment, infrastructure development,, and the build ment building ing of transportatio transportation n fleets that are able to use the new fuels. • Speed the Transition to Next-Generation Technologies. Polic Policies ies are needed to expedite the transition to the the next generation of feedstock and technologies that will enable dramatically increased production at lower lower cost, while reducing negati negative ve environmental environ mental impacts. • Protect the Resource Base. Maintaining soil productivity, water quality, quality, and myriad myriad other ecosystem services is essential. National and international international environmental sustainability principles and certification systems are important for protecting resources as well as maintaining public trust in the merits of  biofuels. • Encourage Broad Rural Economic Benefits. Government fiscal and land use policies will help determine how broadly the economic e conomic revenues revenues from biofuels are spread and how they will shape rural economies. • Facilitate Sustainable International Biofuel Trade. Continued rapid growth growth of biofuels will require require the development of of a true international mark market et in these

fuels, unimpeded unimpeded Figure 6. Ethanol Import Duties in by the trade Selected Countries, 2004 $0.25 restrictions in $0.23 Source: IEA place today. today. Freer $0.20    r movemen mov ementt of bio   e    t     i     L$0.15 $0.14 fuels around the    r    e     P    s world should be    r $0.10    a     l     l $0.10    o $0.07 coupled with social     D $0.05 $0.05 and environmental environmental standards and a $0.00 $0.00   $0.00 Australia United European Brazi Bra zil l Canada Can ada New Ne w Japan credible system to States Union Zealand certify compliance. • Efficiency and Improved Public Transport. Biofuels should be developed within the the context context of a broad transformation of the transport sector sector aimed at dramatically improving transport tra nsport efficiency. Supportive government policies have been essential to the development development of modern biofuels over over the past two decades. Photo by André Bogaert Countries seeking to develop domestic biofuel industries will be able to draw  important lessons— both positive and negative—from the industry pioneers: Brazil, the United United States, State s, and the the European Union. Biofuels could transform agriculture more profoundly than any development since the green revolution. Among the successful policies that have fostered biofuel production and use are: • Blending Mandates • Tax Incentives • Government Purchasing Policies • Support for Biofuel-Compatible Infrastructure and Technologies • RD&D (including crop research, research, conv conversion ersion technology development, development, feedstock handling, etc.) • Public Education and Outreach • Reduction of of Counterprod Counterproductive uctive Subsidies Subsidies • Investment Risk Reduction for Next-Generation Facilities • Gradual Reduction Reduction of Supports as the Market Matures

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Biofuels for Transportation: Global Potential and Implications for Sustainable Agriculture and Energy in the 21st Century was produced by the Worldwatch

Institute and the German Agency for Technical Cooperation (GTZ), with funding from the German Federal Ministry of Consumer Protection, Food and Agriculture (BMELV). The findings and recommendations are based on the work of an international, interdisciplinary interdisciplinary team o off researchers, b building uilding on the input from d detailed etailed country studies carried out by the GTZ in Brazil, China, India, and Tanzania, and do not necessarily reflect the views of the Ministry.

To download a longer summary of the report, visit www www.worldwatch .worldwatch.org/pubs/ .org/pubs/biofuels. biofuels.

Contacts:

Suzanne Hunt Worldwatch Institute 1776 Massachusetts Avenue, N.W. Washington, DC 20036-1904 U.S.A. Tel: (+1) 202.452.1992, ext. 541 Fax: (+1) 202.833.0377 E-mail: [email protected] Elke Förster  Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ) GmbH Dag-Hammarskjöld-Weg 65760 Eschborn 1-5 Germany Tel: (+49) 6196 791424 Fax: (+49) 6196 796103

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