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The lesser evil

For a long time biofuels were the beacon of hope among alternative energies, but now they are increasingly seen as a problem. The EU is cutting back its quotas while international organisations are calling for a major shift in thinking regarding energy consumption.

Politicians and society have learnt their lesson. As long as the use of biogenic fuels was kept on a small scale their reputation was excellent. Rapeseed oil and the biodiesel fuel produced from it were seen as a good solution to the problems of dwindling fossil fuel reserves and global warming.

Photo: AP

The countries of Europe set their goals accordingly: Austria, for instance, plans to increase its use of bio-energy by around 80 percent in comparison with 2004 levels by the year 2020. Sweden aims to become the first country in the world to do without oil as a source of energy entirely – primarily by focussing on the production of energy from biomass. France's Ministry of Agriculture has announced plans to raise its biofuel quota to 7 percent in the next few years, for which it would need to set aside another two million hectares of land for biofuel crops. And in the Czech Republic there are plans to triple the use of biomass by 2010 in comparison with 2005 levels.

No advantages over mineral oil

But in Germany critical voices could already be heard years ago. As early as 1993, the Umweltbundesamt (UBA - the Federal Environment Agency) warned that from the point of view of environmental protection rapeseed oil and biodiesel offered "no decisive advantages” over mineral diesel – but no one listened. At the time the UBA appealed for good old wood, other solid renewable raw materials and organic waste to be used instead – particularly as even back then the expert authorities were sceptical about the potential of rapeseed oil to reduce CO2 emissions, among other things for economic reasons. This would be a "particularly uneconomical measure”, the UBA calculated, because it would be simpler to reduce the fuel consumption of cars by 5 percent than to replace 5 percent of the total consumption of mineral-based fuels with biofuels.

Of EU quotas and directives

But the objections died away. The European Union was particularly keen to promote the use of the biogenic fuels. In its "Directive 2003/30/EC of May 2003 on the Promotion of the Use of Biofuels or other Renewable Fuels for Transport”, it even went as far as to set a target quota: by 2010, 5.75 percent of all motor and diesel fuel was to be produced from biomass. In Germany this directive has already been implemented with the introduction of the Biofuels Quota Act.

A negative energy balance

However, the negative effects of the various biofuels soon became apparent. Intensive farming with use of artificial fertilisers and agricultural chemicals gave bio-energy a bad name, particularly once the energy balance of these fuels came under scrutiny. The high levels of water required in certain regions for growing the biofuel crops provided a further argument against biofuels. And rising food prices, driven up by the competition for land for crops, have also become a major issue: where biofuels are growing, food crops can no longer be planted.

Criticism from the OECD

Since then an increasingly cold wind has been blowing as far as biofuels are concerned. The Organisation for Economic Co-operation and Development (OECD) recently called for all subsidies for biofuels to be scrapped because their cultivation could lead to the destruction of natural habitats. In a report published in July 2008, the OECD wrote that the promotion of biofuels in the EU, the USA and Canada was making only a "minimal” contribution to climate protection. At the same time the promotion of these crops was costing tens of billions per year. "There are much more efficient ways of doing something for climate protection than promoting biofuels”, says Stefan Tangermann, director for trade and agriculture at the OECD. He argues that reducing energy consumption should be the first priority.

Costly compared with emissions trading

For according to the OECD, every ton of CO2 emissions that is avoided through the use of ethanol and biodiesel in North America and Europe costs between 600 and 1,100 euros. That makes it extremely expensive. The standard of comparison continues to be Europe's emissions trading scheme, in which a ton currently trades for 23 euros. That means that companies that are subject to the emissions trading scheme can avoid a ton of CO2 emissions for a thirtieth of what biofuels cost society. Germany's Sachverständigenrat für Umweltfragen, a scientific advisory body which advises the German government on environmental issues, has already explained that in terms of climate protection there are better ways to use biomass than for the production of fuel – for example, by using it in efficient small-scale power plants.

Global commodity flows

It is the complexity of global commodity flows in the farming industry that took advocates of biofuels by surprise and that has now brought the agro-fuels into disrepute. Take the following example: after shortages of European-produced rapeseed oil pushed up its price, many European producers of biofuels started looking to the rain forests for alternatives – or rather to those places where rain forests once grew. For the places where tropical rain forests grow also offer perfect conditions for growing oil palms. Thus in Indonesia large areas of tropical jungle are being cleared to make way for palm plantations. Critics are already bandying around the term "deforestation diesel”.

Destruction of the Amazon

The situation is similar with soya, which can also be used as a raw material for biodiesel. Soya plantations are one of the main reasons behind the destruction of the Amazon region. And developments in the sugar industry are also taking a problematic turn. The fact that sugar can be fermented into bio-alchohol and then mixed with petrol has led to changes on the sugar markets. Latin American environmental groups are already saying that the rise in demand has turned sugar cane plantations and the production of ethanol in Brazil into a farming monopoly that lives from slave labour.

A turning point for biofuels?

In the meantime the German government has taken action. Since August 2006 it has levied a tax on biodiesel which will go up to 45 cents per litre by 2012. Efforts are also underway to turn back the tide at an EU level: the EU's original target whereby agro-fuels such as rapeseed, palm oil and bio-ethanol were to account for 10 percent [of transport fuel] by 2020 has now been lowered to 6 percent. This decision was recently made by the European Parliament's Industry and Energy Committee. Since then observers have been talking of a "biofuel turning point”.

Bernward Janzing

Born in Furtwangen in 1965, Bernward Janzing is a free-lance journalist specialising in the energy industry and technology. He lives in Freiburg.
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