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    AltraBiofuels, a California-based producer of renewable biofuels, announced that it has secured an additional US$165.5 million of debt financing for the construction and completion of two plants located in Coshocton, Ohio and Cloverdale, Indiana. The Coshocton plant's capacity is anticipated to reach 60million gallons/year while the Cloverdale plant is expected to reach 100 million gallons/year. Business Wire - June 23, 2007.

    Brazil and the Dominican Republic have inked a biofuel cooperation agreement aimed at alleviating poverty and creating economic opportunity. The agreement initially focuses on the production of biodiesel in the Dominican Republic. Dominican Today - June 21, 2007.

    Malaysian company Ecofuture Bhd makes renewable products from palm oil residues such as empty fruit bunches and fibers (more here). It expects the revenue contribution of these products to grow by 10% this year, due to growing overseas demand, says executive chairman Jang Lim Kuang. 95% of the group's export earnings come from these products which include natural oil palm fibre strands and biodegradable mulching and soil erosion geotextile mats. Bernama - June 20, 2007.

    Argent Energy, a British producer of waste-oil based biodiesel, announced its intention to seek a listing on London's AIM via a placing of new and existing ordinary shares with institutional investors. Argent plans to use the proceeds to construct the first phase of its proposed 150,000 tonnes (170 million litres) plant at Ellesmere Port, near Chester, and to develop further plans for a 75,000 tonnes (85 million litres) plant in New Zealand. Argent Energy - June 20, 2007.

    The first conference of the European Biomass Co-firing Network will be held in Budapest, Hungary, from 2 to 4 July 2007. The purpose of the conference is to bring together scientists, engineers and members of public institutions to present the current state-of-the-art on biomass co-firing. Participants will also discuss future trends and directions in order to promote awareness of this technology as a sustainable energy supply, which could decrease the dependency on fossil fuels and guarantee a decentralised source of energy in Europe. The conference is supported by the EU-funded NETBIOCOF (Integrated European Network for Biomass Co-firing) project. NetBioCof - June 19, 2007.

    Green Energy Resources predicts US$50 per ton biomass woodchip prices within the next twelve months. The current US price level is between $25-32 per ton. Demand caused by the 25-30 new power plants planned in New England by 2010 does not include industry, institutions, universities, hospitals or conversions from natural gas, or cellulostic ethanol. Procurement of woodchips will be based on the delivery capacity of suppliers not local prices for the first time in history. Green Energy has been positioning in New England with rail and port locations to meet the anticipated sector expansion. MarketWire - June 19, 2007.

    In the first major initiative in the US to build a grassroots communications network for the advancement of biofuels adoption, a new national association called The American Biofuels Council (ABC) has been formed. American Biofuels Council - June 19, 2007.

    The Novi Sad-based Jerković Group, in partnership with the Austrian Christof Group, are to invest about €48 million (US$64.3m) in a biodiesel plant in Serbia. Property Xpress - June 19, 2007.

    Biodiesel producer D1 Oils, known for its vast jatropha plantations in Africa and Asia, is to invest CNY 500 to 700 million (€48.9-68.4 / US$65.5-91.7) to build a refinery in Guangxi Zhuang autonomous region, in what is expected to be the first biodiesel plant in the country using jatropha oil as a feedstock. South China Morning Post - June 18, 2007.

    After Brazil announced a record sugar crop for this year, with a decline in both ethanol and sugar prices as a result, India too is now preparing for a bumper harvest, a senior economist with the International Sugar Organization said. Raw sugar prices could fall further towards 8 cents per lb in coming months, after their 30% drop so far this year. Converting the global surplus, estimated to be 4 million tonnes, into ethanol may offer a way out of the downward trend. Economic Times India - June 18, 2007.

    After Brazil announced a record sugar crop for this year, with a decline in both ethanol and sugar prices as a result, India too is now preparing for a bumper harvest, a senior economist with the International Sugar Organization said. Raw sugar prices could fall further towards 8 cents per lb in coming months, after their 30% drop so far this year. Converting the global surplus, estimated to be 4 million tonnes, into ethanol may offer a way out of the downward trend. Economic Times India - June 18, 2007.

    A report from the US Department of Agriculture Foreign Agricultural Services (USDA FAS) estimates that the production of ethanol in China will reach 1.45 million tonnes (484 million gallons US) in 2007, up 12% from 1.3 million tonnes in 2006. Plans are to increase ethanol feedstocks from non-arable lands making the use of tuber crops such as cassava and sweet sorghum. USDA-FAS - June 17, 2007.

    The Iowa State University's Extension Bioeconomy Task Force carried out a round of discussions on the bioeconomy with citizens of the state. Results indicate most people see a bright future for the new economy, others are cautious and take on a distanced, more objective view. The potential for jobs and economic development were the most important opportunities identified by the panels. Iowa is the leading producer of corn based ethanol in the US. Iowa State University - June 16, 2007.

    Biofuel producer D1 Oils Plc, known for establishing large jatropha plantations on (degraded land) in Africa and Asia, said it was in advanced talks with an unnamed party regarding a strategic collaboration, sending its shares up 7 percent, after press reports linking it with BP. Firms like BP and other large petroleum companies are keen to secure a supply of biofuel to meet UK government regulations that 5 percent of automotive fuel must be made up of biofuels by 2010. Reuters UK - June 15, 2007.

    Jean Ziegler, a U.N. special rapporteur on the right to food, told a news briefing held on the sidelines of the U.N. Human Rights Council that "there is a great danger for the right to food by the development of biofuels". His comments contradict a report published earlier by a consortium of UN agencies, which said biofuels could boost the food security of the poor. Reuters - June 15, 2007.

    The county of Chicheng in China's Hebei Province recently signed a cooperative contract with the Australian investment and advisory firm Babcock & Brown to invest RMB480 million (€47.2/US$62.9 million) in a biomass power project, state media reported today. Interfax China - June 14, 2007.

    A new two-stroke ICE engine developed by NEVIS Engine Company Ltd. may nearly double fuel efficiency and lower emissions. Moreover, the engine's versatile design means it can be configured to be fuelled not only by gasoline but also by diesel, hydrogen and biofuels. PRWeb - June 14, 2007.

    Houston-based Gulf Ethanol Corp., announced it will develop sorghum as an alternative feedstock for the production of cellulosic ethanol. Scientists have developed drought tolerant, high-yield varieties of the crop that would grow well in the drier parts of the U.S. and reduce reliance on corn. Business Wire - June 14, 2007.

    Bulgaria's Rompetrol Rafinare is to start delivering Euro 4 grade diesel fuel with a 2% biodiesel content to its domestic market starting June 25, 2007. The same company recently started to distributing Super Ethanol E85 from its own brand and Dyneff brand filling stations in France. It is building a 2500 ton/month, €13.5/US$18 million biodiesel facility at its Petromidia refinery. BBJ - June 13, 2007.

    San Diego Gas & Electric (SDG&E), a utility serving 3.4 million customers, announced it has signed a supply contract with Envirepel Energy, Inc. for renewable biomass energy that will be online by October 2007. Bioenergy is part of a 300MW fraction of SDG&E's portfolio of renewable resources. San Diego Gas & Electric - June 13, 2007.

    Cycleenergy, an Austrian bioenergy group, closed €6.7 million in equity financing for expansion of its biomass and biogas power plant activities in Central and Eastern Europe. The company is currently completing construction of a 5.5 MW (nominal) woodchip fired biomass facility in northern Austria and has a total of over 150 MW of biomass and biogas combined heat and power (CHP) projects across Central Europe in the pipeline. Cycleenergy Biopower [*.pdf] - June 12, 2007.

    The government of Taiwan unveils its plan to promote green energy, with all government vehicles in Taipei switching to E3 ethanol gasoline by September and biofuel expected to be available at all gas stations nationwide by 2011. Taipei Times - June 12, 2007.

    A large-scale biogas production project is on scheme in Vienna. 17,000 tonnes of organic municipal waste will be converted into biogas that will save up to 3000 tonnes of CO2. 1.7 million cubic meters of biogas will be generated that will be converted into 11.200 MWh of electricity per year in a CHP plant, the heat of which will be used by 600 Viennese households. The €13 million project will come online later this year. Wien Magazine [*German] - June 11, 2007.

    The annual biodiesel market in Bulgaria may grow to 400 000 tons in two to three years, a report by the Oxford Business Group says. The figure would represent a 300-per cent increase compared to 2006 when 140 000 tons of biodiesel were produced in Bulgaria. This also means that biofuel usage in Bulgaria will account for 5.75 per cent of all fuel consumption by 2010, as required by the European Commission. A total of 25 biofuel producing plants operate in Bulgaria at present. Sofia Echo - June 11, 2007.

    The Jordan Biogas Company in Ruseifa is currently conducting negotiations with the government of Finland to sell CER's under the UN's Clean Development Mechanism obtained from biogas generated at the Ruseifa landfill. Mena FN - June 11, 2007.

    Major European bank BNP Paribas will launch an investment company called Agrinvest this month to tap into the increased global demand for biofuels and rising consumption in Asia and emerging Europe. CityWire - June 8, 2007.

    Malaysian particleboard maker HeveaBoard Bhd expects to save some 12 million ringgit (€2.6/US$3.4 million) a year on fuel as its second plant is set to utilise biomass energy instead of fossil fuel. This would help improve operating margins, group managing director Tenson Yoong Tein Seng said. HeveaBoard, which commissioned the second plant last October, expects capacity utilisation to reach 70% by end of this year. The Star - June 8, 2007.

    Japan's Itochu Corp will team up with Brazilian state-run oil firm Petroleo Brasileiro SA to produce sugar cane-based bioethanol for biofuels, with plans to start exporting the biofuel to Japan around 2010. Itochu and Petrobras will grow sugarcane as well as build five to seven refineries in the northeastern state of Pernambuco. The two aim to produce 270 million liters (71.3 million gallons) of bioethanol a year, and target sales of around 130 billion yen (€800million / US$1billion) from exports of the products to Japan. Forbes - June 8, 2007.

    Italian refining group Saras is building one of Spain's largest flexible biodiesel plants. The 200,000 ton per year factory in Cartagena can handle a variety of vegetable oils. The plant is due to start up in 2008 and will rely on European as well as imported feedstocks such as palm oil. Reuters - June 7, 2007.

    The University of New Hampshire's Biodiesel Group is to test a fully automated process to convert waste vegetable oil into biodiesel. It has partnered with MPB Bioenergy, whose small-scale processor will be used in the trials. UNH Biodiesel Group - June 7, 2007.

    According to the Barbados Agricultural Management Company (BAMC), the Caribbean island state has a large enough potential to meet both its domestic ethanol needs (E10) and to export to international markets. BAMC is working with state actors to develop an entirely green biofuel production process based on bagasse and biomass. The Barbados Advocate - June 6, 2007.


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Friday, June 22, 2007

UK government proposes new measures to encourage sustainable biofuels

The UK's Transport Secretary Douglas Alexander underlined the British government's commitment to sustainable biofuels, as he launched a consultation on an environmental reporting system for this type of fuel and a package of measures to complement the reporting requirement.

The consultation is a key part of work on the Renewable Transport Fuel Obligation (RTFO), which means that by 2010, 5% of all the fuel sold on UK forecourts should come from biofuels. This is expected to save 1 million tones of carbon a year, the equivalent of taking 1 million cars off the road.

In addition to the consultation, the Secretary of State today announced that:
  • from April 2010 the government aims to reward biofuels under the RTFO according to the amount of carbon they save. This will be subject to compatibility with EU and WTO requirements and future consultation on the environmental and economic impacts;
  • from April 2011 the government aims to reward biofuels under the RTFO only if they meet appropriate sustainability standards. This will be subject to the same provisos as above and subject to the development of such standards for the relevant feedstocks.
  • the government will ask the RTFO Administrator to report every three months on the effectiveness of the RTFO's environmental reporting system, and on the carbon and sustainability effects of the RTFO;
  • the government intends to set challenging targets for: the level of greenhouse gas savings we expect to see from biofuels used to meet the RTFO, the proportion of biofuels from feedstock grown to recognised sustainability standards and the amount of information we expect to be included in sustainability reports;
  • the government has asked the Low Carbon Vehicle Partnership to explore the feasibility of a voluntary labelling scheme, allowing responsible retailers to show that the biofuels they supply are genuinely sustainable. Any scheme would need to be compatible with WTO rules.
Note that the references to the WTO rules imply that such sustainability criteria can not become a new set of protectionist trade barriers blocking the import of competitive biofuels produced in the developing world. Moreover, it is to be expected that very few biofuels produced in either the US or the EU can conform to a criterion that requires these biofuels to reduce carbon emissions. There is as yet no scientific consensus on the greenhouse gas balance of these fuels. Some scientists have found first generation biodiesel and ethanol made from rapeseed and corn to be net carbon contributors or to have very weak balances (here for rapeseed, and for corn).

On the other hand biofuels made from tropical crops, like sugarcane and cassava-based ethanol and sustainably produced biodiesel from palm oil, have a very strong carbon and energy balance, but they may fuel deforestation and partly offset these advantages. Alternative crops like new varieties of sweet sorghum and jatropha curcas, which thrive in non-forest, semi-arid lands may offer the perfect compromise. Other tropical grass and tree species might do so as well and prove better feedstocks for second-generation biofuels than the ones currently used in the UK. There is a large potential for sustainable biofuel trade (earlier post).

The British government has often stated that without bioenergy imports it will not be easy to achieve its biofuels targets. Moreover, it has been investing (together with Brazil) in a few developing countries to help them produce biofuels for export. But amongst key stakeholders there is now a consensus that a comprehensive set of sustainability criteria for all biofuels should be introduced:
:: :: :: :: :: :: :: :: :: ::

A large number of existing agri-environment and social accountability schemes have been benchmarked against a set of core environmental and social principles, to allow the government to propose a list of "qualifying standards" for RTFO purposes. These are standards that deliver an acceptable level of sustainability assurance. The consultation document suggests that the following standards should initially count as "qualifying standards", although the list will be revised as suitable new standards are developed for different feedstocks:
On launching the consultation Douglas Alexander said:
Biofuels present an opportunity to address the climate change impact of transport. But we must ensure appropriate safeguards are in place. The UK is leading international debate on this issue. We are one of the first countries to develop a detailed methodology to allow transport fuel suppliers to report in detail on the carbon and sustainability impacts of their biofuels. And the comprehensive package of new measures we are proposing today only strengthens this global leadership role, by making clear our determination to put in place a mandatory sustainability framework for biofuels, putting us at the forefront globally of tackling this important issue.
To receive certificates under the RTFO scheme from April 2008, it is intended that transport fuel suppliers will have to complete a report on the carbon savings offered by their biofuels, as well as on the wider sustainability impacts associated with them. The RTFO Administrator will publish information on the environmental impacts of the RTFO. The consultation sets out the detail of the proposed requirements for these reports.

The consultation closes on 13 September. The RTFO Administrator will publish the final version of the reporting requirements as soon as possible after the RTFO Order has been made.

The approach will be piloted with a number of transport fuel suppliers alongside the public consultation.

The British consultation comes after the Netherlands created a first proposal for a set of biofuels sustainability criteria, earlier this year, the so-called Cramer Criteria. On a conceptual level, some researchers have designed a kind of Green Biofuels Index, measuring the greenhouse gas and energy balance of particular biofuels.

Note that none of the proposals takes social justice nor historical justice into account. Developing countries have often said that the US and European countries have deforested their own forests long ago, which allowed them to create a modern agricultural base which they now might use to grow energy crops - as if this past doesn't count.

This historic deforestation burden not only contributed massively to past greenhouse gas emissions, it also allowed rapid industrialisation. Developing countries think it is unfair that the US and the EU impose criteria on them today, whereas these very countries have a tremendous historic deforestation burden. In fact, the West has become so wealthy because of this highly carbon intensive industrial development, that it has broken the trend of increasing deforestation. In the EU and the US, forest cover is for the first time in centuries increasing again (more here).

A more just proposal for sustainability criteria would add carbon emitted from deforestation in the past, to the actual carbon balance of biofuels produced in the present. On the historic carbon burden of highly industrialised countries, see here.

References:
The consultation documents, including further information on the proposed targets, can be found on the UK's Department for Transport website, here.



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