France speeds up green energy effort - Chirac defends EU biofuel subsidies
Several developments in France show that the country is speeding up its efforts on biofuels. For Biopact, these steps are a mixed blessing.
The good news is that France is building a distribution infrastructure for biodiesel and ethanol, with the Ministry of Finance pledging support "without reservation" for the development of E85, a fuel made of 85% ethanol as "the first fuel of the post-oil era". Large-scale development of E85 should first and foremost serve the interest of consumers by remaining cheap. It will also serve France's energy independence. Concretely, from 2007 onwards, 500 to 600 ethanol pumps will be built in France, at the 'grandes autoroutes' network which connects most cities of the country with Paris.
Secondly, minister Thierry Breton announced that French car makers have committed to investing in flex-fuel cars that can effectively use the E85 fuel. He projects that by 2009, half of all new cars sold in France will be flex-fuel cars. If this level of market penetration can indeed be realised, the country's ambitious biofuels plan stands a chance of succeeding.
These two developments are good news, because it means that a green fuel infrastructure and fleet is going to come into existence. Our goal, however, is to have the actual fuel coming from the developing world. It is on this point that a third development is threatening. President Jacques Chirac announced today that France will defend biofuel subsidies for its farmers. France is a recipient of funds under the EU's Common Agricultural Policy, the subsidies of which many see as a huge barrier to the development of agriculture in the Global South.
The recent 'Doha Development Round' of trade negotiations collapsed precisely because neither the EU nor the US were prepared to lower their agricultural subsidies. Some have said biofuels and bioenergy may offer the key to break this deadlock, even though if it simply means that agricultural subsidies are going to be replaced with biofuels subsidies, not much will change. Chirac's announcement contains a first and disappointing hint that this may actually be the future course of the EU.
Chirac called on the EU on Thursday to start planning for a future of non-food-based farming, saying that agriculture must remain "at the heart of the European ambition." Meeting with farmers, Chirac set out what he said were the "new frontiers" of agriculture — based on bio-technologies and non-food-based farming — and a continued central role in farming for France. While farmers leave the profession in growing numbers, agriculture remains "at the heart of this century's challenges ... and France is one of the best placed countries in the world to take it up," the president said.
France is an EU agriculture leader and its farmers are among the top beneficiaries of EU subsidies. Paris has scuffled with partners to maintain its hefty subsidies to farmers. Chirac warned that reforms of the EU's Common Agriculture Policy, or PAC, as well as financing, must not be thrown into question "until 2013 included," a reference to the EU budget of 2007-2013:
ethanol :: biodiesel :: bioenergy :: biofuels :: energy :: sustainability :: subsidies :: European Union :: France ::
At the same time, the World Trade Organization plans to eliminate farm export subsidies by 2013, including those in Europe, the United States, Canada and Australia.
For the period after 2013, "the new CAP must maintain community preference and public aid for the social and environmental aspects of agriculture," he said. Above, all it must expand to include non-food products.
He asked that European agriculture experts begin reflecting "starting now" on the farming of the years 2015-2020 and called for a European conference on the future of agriculture.
"I say it firmly. Europe was largely built on agriculture. It must remain at the heart of the European ambition," Chirac said.
More information:
BBC News: Chirac pushes for biofuel farming - Oct. 6, 2006
http://news.bbc.co.uk/2/hi/europe/5412528.stm
International Herald Tribune: French president pleads for non-food agriculture of future - October 5, 2006
Le Monde: Thierry Breton : "Un véhicule sur deux roulera au flexfuel en 2009" - Oct. 3, 2005.
Euractiv: France to gear-up biofuels use from 2007 - Sept. 28
Article continues
The good news is that France is building a distribution infrastructure for biodiesel and ethanol, with the Ministry of Finance pledging support "without reservation" for the development of E85, a fuel made of 85% ethanol as "the first fuel of the post-oil era". Large-scale development of E85 should first and foremost serve the interest of consumers by remaining cheap. It will also serve France's energy independence. Concretely, from 2007 onwards, 500 to 600 ethanol pumps will be built in France, at the 'grandes autoroutes' network which connects most cities of the country with Paris.
Secondly, minister Thierry Breton announced that French car makers have committed to investing in flex-fuel cars that can effectively use the E85 fuel. He projects that by 2009, half of all new cars sold in France will be flex-fuel cars. If this level of market penetration can indeed be realised, the country's ambitious biofuels plan stands a chance of succeeding.
These two developments are good news, because it means that a green fuel infrastructure and fleet is going to come into existence. Our goal, however, is to have the actual fuel coming from the developing world. It is on this point that a third development is threatening. President Jacques Chirac announced today that France will defend biofuel subsidies for its farmers. France is a recipient of funds under the EU's Common Agricultural Policy, the subsidies of which many see as a huge barrier to the development of agriculture in the Global South.
The recent 'Doha Development Round' of trade negotiations collapsed precisely because neither the EU nor the US were prepared to lower their agricultural subsidies. Some have said biofuels and bioenergy may offer the key to break this deadlock, even though if it simply means that agricultural subsidies are going to be replaced with biofuels subsidies, not much will change. Chirac's announcement contains a first and disappointing hint that this may actually be the future course of the EU.
Chirac called on the EU on Thursday to start planning for a future of non-food-based farming, saying that agriculture must remain "at the heart of the European ambition." Meeting with farmers, Chirac set out what he said were the "new frontiers" of agriculture — based on bio-technologies and non-food-based farming — and a continued central role in farming for France. While farmers leave the profession in growing numbers, agriculture remains "at the heart of this century's challenges ... and France is one of the best placed countries in the world to take it up," the president said.
France is an EU agriculture leader and its farmers are among the top beneficiaries of EU subsidies. Paris has scuffled with partners to maintain its hefty subsidies to farmers. Chirac warned that reforms of the EU's Common Agriculture Policy, or PAC, as well as financing, must not be thrown into question "until 2013 included," a reference to the EU budget of 2007-2013:
ethanol :: biodiesel :: bioenergy :: biofuels :: energy :: sustainability :: subsidies :: European Union :: France ::
At the same time, the World Trade Organization plans to eliminate farm export subsidies by 2013, including those in Europe, the United States, Canada and Australia.
For the period after 2013, "the new CAP must maintain community preference and public aid for the social and environmental aspects of agriculture," he said. Above, all it must expand to include non-food products.
He asked that European agriculture experts begin reflecting "starting now" on the farming of the years 2015-2020 and called for a European conference on the future of agriculture.
"I say it firmly. Europe was largely built on agriculture. It must remain at the heart of the European ambition," Chirac said.
More information:
BBC News: Chirac pushes for biofuel farming - Oct. 6, 2006
http://news.bbc.co.uk/2/hi/europe/5412528.stm
International Herald Tribune: French president pleads for non-food agriculture of future - October 5, 2006
Le Monde: Thierry Breton : "Un véhicule sur deux roulera au flexfuel en 2009" - Oct. 3, 2005.
Euractiv: France to gear-up biofuels use from 2007 - Sept. 28
Article continues
Friday, October 06, 2006
Gabon's biofuel dilemma
Gabon is one of Africa's most successful economies. As a major oil producer it succeeded in managing its petro-dollars exceptionally well, in contrast to many other African countries where the black gold is a real curse, leading to mass corruption, political instability and enormous social inequalities.
Because of this good management, other economic sectors have thrived, and more importantly, Gabon has been able to protect its precious environment. The rainforests of the country constitute one of the world's biodiversity hotspots. A fledgling eco-tourism industry has been built around it and large areas have been designated as natural parks and protected zones. Control mechanisms against illegal logging and poaching seem to be working [see Gabon's Biodiversity and Protected Areas profile at the World Resources Institute's Earthtrends website].
All these positive developments are due to Gabon's well managed oil wealth. But the country's petroleum production is facing a rapid decline: whereas today Gabon produces some 265,000 barrels per day, it is estimated that by 2010 this will have halved to approximately 140,000bpd. Obviously, the question then becomes whether the Central African country can keep both its economy growing and its environment intact when the petro-dollars stop flowing in.
Biofuels production in Gabon would be highly problematic, given its pristine ecosystems. The risk exists that a simplistic economic logic will prevail and that forests are going to be logged to make place for energy crops. However, the current government, and more in particular its Minister for Conservation, Enviroment, Science & Technology, Mme Georgette Koko, is clearly committed to protecting this resource. How to do this in a concrete manner, and given the pressure of declining oil revenues, is a very difficult matter.
Earlier we reported about a new idea that is being circulated to help developing countries like Gabon protect their ecosystems and more in particular their tropical rainforests. The concept is known as 'compensated reduction' and it comes down to putting a concrete monetary value on the resource (rainforests as carbon sinks), which can be translated into a carbon credit that can then be traded on the global carbon market. This approach is interesting, but hardly sufficient:
bioenergy :: biofuels :: energy :: sustainability :: ecoservices :: compensated reduction :: rainforests :: oil depletion :: Gabon ::
The question is whether such a mechanism will ever succeed in stopping illegal deforestation and the conversion of forests into lands for energy crops. The hard economic truth tells us that 'compensated reduction' will fail if a price based on the mere market value for carbon is put on the forests. Energy crops bring in much more immediate cash profits. Moreover, when oil resources decline, prices for energy shoot up, making the case for biofuels even stronger (Gabon will experience this stress very soon within its own market). The price for carbon is not tied in such a straight manner to oil prices.
So what to think of compensated reduction? We have a reference point which shows whether this accounting system results in a compensation strong enough to counter the push towards erasing tropical forests in order to plant energy crops. Recently, scientists calculated the total value of all the eco-services of Boreal forests. These services include carbon capture and storage, water filtration and waste treatment, biodiversity maintenance, pest control, and so on. The total monetary value was estimated to be about US$160 per hectare of forest. Extrapolating this to tropical rainforests is very difficult, but even doubling this value (taking into account eco-tourism, discovery of plant pharmaceuticals, etc...) would still not be enough to compensate farmers whose alternative is to grow energy crops. An oil palm plantation brings between US$500-800 per hectare of net profits to a small farmer. Compensated reduction does not compensate enough.
So countries like Gabon face a very difficult dilemma. Unless oil consumers - that is all of us - start saving energy, or start building a global fund for the future protection of rainforests and biodiversity in the tropics, Gabon will probably not withstand the push towards producing energy crops. Compensated reduction, if merely based on carbon prices, will never tempt farmers to give up planting energy crops.
Another strategy might be found in introducing market barriers based on sustainability criteria for biofuels. The world's largest economies, the EU and the US, can decide to block market access for biofuels that were not produced in a sustainable manner. The problem is that a country like Gabon will look at its own energy needs first, and only if those are satisfied will it think of exporting bioenergy.
On the other hand, the EU/US are already losing power on the global market today, where growth in energy consumption is coming from rapidly emerging economies like China and India. It is highly unlikely to see the latter countries coupling market access for biofuels to stringent sustainability criteria. We are already seeing that China's 'no questions asked' attitude in Africa is extremely utilitarian. 'Soft' concepts like environmental conservation are not on its agenda. This means that a Gabonese farmer may decide to skip the EU/US markets, and simply sell to China or India. No questions asked.
It will be interesting to see how a country like Gabon deals with this dilemma. As its oil production declines, it will have to think very carefully on how to resist the temptation of abandoning its successful conservation policies in favor of biofuels production.
More information:
InfoPlus Gabon: A quand le biocarburant dans les stations d’essence du Gabon? - Sept. 27, 2006
InfoPlus Gabon: Le ministère de l’Environnement veut préserver les écosystèmes - Feb. 10, 2006
Article continues
posted by Biopact team at 6:54 PM 0 comments links to this post