Are Biofuels the Answer?

Are biofuels the answer? It depends on what the question is.

Biofuel Investment Prospects

BusinessWeek this week has a solid article reviewing the investment landscape for biofuels. The question it tries to answer is, Who will make money in biofuels? The short answer, according to BusinessWeek: “Shell, BP, DuPont, and other majors.” Read the article to see why.

But there are other vital questions about biofuels. Are they really a feasible source of energy? Can biofuels reduce our dependence on fossil fuels and foreign energy sources? Can they mitigate global warming?

A Liquid, Mass-Producible Fuel

Since biofuels are made from plants, some consider them inherently renewable, especially compared to fossil fuels, which are extracted from the ground and would take millions of years to replenish. In theory, biofuels can be created in huge volumes, over millions of acres of forest and agricultural land, and even in the water (for algae-derived bio fuels). Although they release greenhouse gases when burned, they absorb them when growing, theoretically making them friendlier to the environment than fossil fuels.  And, as a liquid fuel, they could share the existing pipeline and tanker-based distribution network already developed for oil and gasoline. That is one reason why Shell has made multiple investments in biofuels.

Some Schemes Blasted for Ineffectiveness

There are probably dozens of biofuel schemes under development or discussion. Some of them have come under harsh criticism. Corn-based ethanol programs, for instance, are blamed for driving up food prices, as farmland was shifted to food-crop use. And ethanol has up to 36% less energy per gallon than gasoline. It is said to offer  relatively little benefit in reducing greenhouse gases compared to other types of biofuels. And the picture of greenhouse gas benefits has recently gotten blurrier.

Biofuels Exacerbate Global Warming?

Last year a controversial study was published that asserted “Almost all biofuels used today cause more greenhouse gas emissions than conventional fuels if the full emissions costs of producing these ‘green’ fuels are taken into account.”

If this were true, that would make biofuels useless from the point of view of abating global warming. But how to calculate the true, full-lifecycle impact of a biofuels program on greenhouse gas emissions is still being debated. A California Air Resources board, which just adopted a new regulation to limit greenhouse gas emissions from cars and trucks, has decided that the question needs further study and has asked staffers to report back on this issue in January of 2011.

The Limits of Market Forces

It is seductive to believe that market forces will usher in our energy future so long as the true cost and benefit of all alternatives is reflected in market prices. But the true carbon-cost of biofuels looks like it will be debated for some time. And it may well be ultimately defined via a political, rather than a scientific, process. That could cause free-market hopefuls to despair.

Unintended Consequences

It’s worth noting that biofuels programs carry the risk of several unintended consequences:

  • paradoxically increasing greenhouse gas emissions
  • distorting agricultural land use
  • reducing supply and increasing cost of human and animal food sources
  • necessitating increased use of fertilizers

Unintended consequences are not a distinctive feature of biofuels–all energy technologies seem prone to them. (Look for a blog post on this topic soon.)

Alas, More Study Is Needed

But altogether, it seems that there is more research and debate required before there is clarity on the role of biofuels in our energy complex. Personally, I am incline to favor those that focus on reclaiming agricultural and forest waste and make use of marginal/unproductive agricultural land, rather than the vast programs that forsee dedicating tens of millions of productive agricultural acres to it. At least not yet.

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1 Comment

Filed under biofuels, carbon, emissions

One response to “Are Biofuels the Answer?

  1. Worth taking a look at the documentary “Fields of Fuels”. I think that biofuels won’t be enough and the solution to transport energy needs lie in the mitigation of the travel than alternatives to fuel, like supporting the public transport and non-motorized transport.

    See my post from January (updated in April) on biofuels

    Very nice blog. Came across this morning following your “Carbon Cost” email to GHG mailing list.

    With regards,

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