Have We Reached Peak Bio-fuel?

Is there really an energy security risk?


Former NATO Secretary General Anders Fogh Rasmussen is calling on Europe to increase the production of biofuels from an energy security perspective because of geopolitical risks. This is a tough ask if such increase in supply levels of 1st generation feedstock for fuel runs counter to the need to provide food security with an ever-increasing population.


Do we have any land left to grow food?


According to the “Global biofuel production, 1980–2013” U.S. Energy Information Administration, in 2011 the world production of ethanol was 545 billion gallons of which the US produced 61% and Brazil produced 26%. For biodiesel was 147 billion gallons. The EU accounted for 44%, the US 16% and Brazil had 11%.


The USDA reported that the growth of biofuel production between 2001 when 7% of the US corn crop was used for Ethanol production rose to 45% by 2013. US Soybean use for biodiesel rose from 2007 at 14% to 30% by 2013. The key reasons for biofuel production are mainly due to subsidies and fuel mandates. However, by 2013 the blending limits for ethanol in gasoline had reached its peak requiring an amendment to fuel mandates in blending ratios of ethanol to gasoline to increase production.


In Europe, where the vast majority of ethanol is produced from wheat, the EU 2020 targets require that 10% of transportation should be from biofuels. Adding to the restriction is that these targets have to be met with no more than 7% of the land, where currently as much as 5% is already being used for growing feedstocks for biofuel production. There are many opinions on the sustainability of biofuel production, from my own perspective in a recent article (“Biofuel, even cellulosic ethanol, is wasteful“) or on the use of land relating to the term “Peak Soil”.


Where has all the food gone?


There is substantial evidence that the increase in biofuel production over the last 10 years has resulted in an increase in volatility of the price of food. Subsidies and minimum fuel mandates that lead to any further growth in biofuel production in Europe, or any of the OECD countries, as suggested by Anders Rasmussen, for first-generation biofuels will likely contribute to food insecurity of consumers of food in low-income countries.


Therefore, if public assistance is provided to promote first-generation biofuel production for the purpose of energy security or reducing greenhouse gas emissions, an impact assessment should be undertaken where such policies impose upon food security. The short and long-term implications of such policies on the undernourished and the vulnerable must be explicitly considered in any policy evaluations of their costs and benefits.


Where else can they go?


There is a risk that negative effects of any growth in biofuel production will add to an increase of economic migration. With the potential of as many as 8 to 10 million migrants moving into Europe due to food price volatility that may not only affect low-income countries.

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