Thursday, February 21, 2008

Even EU-Mandarinate Questions Ethanol & other Biofuels

Ethanol made with corn [maize] is widely seen as a political scam by farm-belt states to boost the price per bushel. Hence Bob Dole was called the Senator from Archer-Daniel Midlands behind his back. Here's a tidbit on how the ever-so-politically-correct Euroweenies are sorting it out:
ARE WE living at a high point of support for biofuels, at least in Europe, as a means of tackling climate change? The signs are pointing that way. Officially, the 27 nations of the European Union are still committed to a (wildly ambitious) target of using fuel from plants to provide 10% of all the fuel needs of EU's transport sector by 2020 (biofuels account for about 2% of transport fuel at the moment, and even that is concentrated in a handful of countries).

The agriculture lobby remains gung-ho for this target, part of the wider EU climate change package agreed with much fanfare last March. Whole swathes of central Europe are turning yellow, as farmers ramp up production of oilseed rape, with a view to selling to biodiesel manufacturers.

But the chorus of dissenting voices is not just growing, it is changing in nature. At first, the main opposition came from NGOs and environmental groups, worrying that biofuels were not as green as they were cracked up to be, and backed by a number of scientists. Then the scientific credentials of the doubters started to improve, with some serious journals publishing worrying findings about previously unsuspected indirect damage caused by planting biofuel crops on grasslands, or scrubby areas.

Last month, a leaked report by scientists from the European Commission's own research body said there was it was impossible to say with any reasonable degree of certainty that biofuels actually saved on greenhouse gas emissions. The same month, a House of Commons committee in Britain came out against biofuels. Now, it emerges that the British government is launching a major review of biofuels, and whether they do any good. The review comes from the transport ministry, and the wording of its announcement makes pretty clear that the government is having second thoughts about the whole EU target.

According to the British government announcement:

"A number of new research papers have come out in recent weeks and months (including in particular a recent article in Science magazine "Use of US croplands for biofuels increases greenhouse gas emissions through emissions from land use change") which suggest that the indirect impacts of biofuel production have not always been taken into account in earlier carbon saving calculations."

Officially, the European Commission (under heavy pressure from farmer-friendly nations in the block), is still keen on the biofuels target. But leaders left themselves a get-out clause when they agreed the plan last year. The biofuels target kicks in only if environmentally sustainable biofuels are available. The commission and the current holders of the EU rotating presidency, Slovenia, are reportedly working on sustainability criteria at the moment. Expect serious horse-trading, and much lobbying, as those criteria are worked out: the way they are worded will probably make some forms of fuel viable in the EU, and others not. Battlecamps are already forming. There is the biodiesel lobby, the lobby for buying ethanol from hot and sunny places like Brazil, the lobby for palm oil from Asia, and all the rest of them.

It would not be astonishing if Britain ended up leading one of the opposing factions in this debate. As a big country that likes to think of itself as a leader, generally, in the climate change debate, it is also run by a government that is pretty deaf to appeals from its domestic farming lobby.

If this reporter had to make a prediction, the EU will still end up with some sort of biofuels target, because the farm lobby in Europe is so powerful, but it will not be anything close to 10%. Talking to an official about all this today, they made the good point that any big cut in the biofuel target would cause another, follow-on problem, because it would put the transport sector under pressure to find another way to cut greenhouse gas emissions. We have not heard the last of this.

Even the much more cost-effective Brazilian ethanol made from sugar cane costs close to the petroleum equivalent, and US corn-based ethanol costs more to make than it delivers in BTUs. God gave the Euros an attitude, but little natural resource bases onshore except coal.

And the US is the Saudi Arabia of coal.

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