Monday, February 28, 2011

"Perhaps the most regressive public policy ever initiated"

and "not just madness, it is wicked."

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U.S. Has "Foot On The Gas" On Ethanol: Vilsack; Analysis


U.S. Has "Foot On The Gas" On Ethanol: Vilsack

Date: 28-Feb-11
Country: USA
Author: Charles Abbott

U.S. Has
A truckload of corn is dumped into a chute at the Lincolnway Energy plant in the town of Nevada, Iowa, December 6, 2007.
Photo: Jason Reed

The United States "can do it all" -- turn more corn into ethanol without running short of food, Agriculture Secretary Tom Vilsack said on Thursday, as oil prices soared and the government raised its forecast of food price increases this year.
"There is no reason for us to take the foot off the gas," said Vilsack, referring to biofuels at a two-day Agriculture Department conference on the outlook for this year's crops. "We can do it all."
A record 5 billion bushels of corn will be used to make ethanol in the marketing year opening on Sept 1, up slightly from this year, said USDA. It also forecast food prices will rise 3.5 percent this year -- double the U.S. inflation rate.
Former president Bill Clinton, who spoke shortly after Vilsack, said there were stark trade-offs in using crops to make fuel. They affect the food supply in other nations as well as decisions around the world on where to grow crops.
"I think the best thing to say is we have to become energy independent but we don't want to do it at the cost of food riots," said Clinton. "The more biofuels we grow here, the less crops we have to put on the international market."
Vilsack said biofuels are an important component to U.S. energy security that also boost rural employment and income. A 2007 law guarantees a rising share of the motor fuel market to ethanol, peaking at 15 billion gallons from 2015. Production is running at 13.5 billion gallons a year now.
U.S. farmers are capable of growing enough corn to meet rising demand for food, fuel, livestock feed and exports, he said. This year's corn crop is projected for a record 13.73 billion bushels, up 10 percent from last year. Corn supplies are expected to be tight for one or two more years, however.
Clinton suggested annual reviews of supplies to assure there will be "good food at affordable prices," to maximize energy independence and to prevent climate change but did not say who should carry out the reviews.
Analyst Gary Blumenthal of consultants World Perspectives said biofuel use reduces U.S. grain exports and "certainly is incentivizing production elsewhere."
"The inequity in the situation is biofuel is a mandated market," Blumenthal said. "You're not allowing food to compete fairly with fuel" in buying supplies.
Dan Glickman, agriculture secretary during the Clinton era, said "by and large, it (ethanol) has a positive impact" on the economy and was only a small factor in food prices. Glickman said Clinton did not suggest government rationing or grain.
Some 4.95 billion bushels of corn are forecast to be turned into ethanol in the year ending Aug 31. Joe Glauber, USDA chief economist, said usage would rise marginally in the new year because ethanol is saturating the market at the 10 percent blend that is standard.
The Environmental Protection Agency has approved a 15 percent ethanol blend for cars and light trucks made since 2000, about 60 percent of the fleet. The U.S. House (of Representatives) voted last weekend to block EPA from implementing E15 and to bar use of federal funds to install "blender" pumps that dispense up to 85 percent ethanol in fuel, but the Senate has yet to act on such legislation.
Corn grower and ethanol trade groups said Clinton was wrong. There is plenty of fallow farmland that could be used for biofuels without harming the environment and that petroleum is a bigger factor in food prices, they said.
Oil prices rocketed above $100 a barrel on Thursday due to unrest in the Middle East but retreated slightly. U.S. crude oil settled at $97.28 a barrel after hitting its highest price since September 2008.
( Editing by David Gregorio)

© Thomson Reuters 2011 All rights reserved


Analysis: Forget Fuel Costs, U.S. Farmers Cheer Oil Surge

Date: 28-Feb-11
Country: USA
Author: Carey Gillam and Rod Nickel

Not too long ago, a surge in oil prices such as this week's would have caused a groan of misery from the U.S. farm belt, forced to pay higher prices for tractor fuel and fertilizer. Today, farmers are far more likely to cheer.
The farm sector's response to a surge in fuel costs has inverted for two important reasons: the rise of biofuels now means more corn and soybeans are likely to be drawn into the fuel pool; and the disconnect between natural gas and crude prices means fertilizer costs are not being dragged higher.
While neither trend is new, it's been put in sharp relief this week as U.S. oil prices surged to $100 for the first time since 2008 amid Middle East unrest. U.S. crude futures rose toward $100 per barrel again on Friday before easing.
On balance, the surge is far more likely to lend support for a near-record corn sowing season than it is to crimp farm income through higher costs for crop chemicals and transportation charges, analysts say.
"All indications are that the only thing that will keep a farmer from planting this year is if he drops dead walking out the door ... and then somebody else will grab his tractor and plant for him," said Missouri corn farmer Richard Oswald.
"There is every incentive in the world to plant. High oil prices are just one more incentive."
In addition, the surge has come long after most farmers have tilled their fields and locked in fertilizer purchases, leaving them better prepared than in 2007-2008, according to National Corn Growers Association CEO Rick Tolman.
"When we saw this (run-up) a couple years ago, it really raised input prices and squeezed the margin," said Tolman.
This year, input costs may pinch, but they won't puncture the upbeat mood. Grain futures have fallen sharply this week as risk-averse speculators flee the market, but most remain within sight of their records struck in 2008.
Profits this year look to be strong. The U.S. Department of Agriculture has forecast farm income to be $94.7 billion in 2011, up 19.8 percent from the 2010 forecast and the second-highest inflation-adjusted value in the past 35 years.
To be sure, higher oil prices raise transportation costs for farmers just like everyone else.
However, fuel to run farm machinery, trucks and other equipment accounts for only a tiny portion of overall inputs -- about 3 percent of the total cost of growing corn on an acre of land in central Illinois this year, said Gary Schnitkey, professor of farm management at University of Illinois.
That's more than offset by the bullish impact on grain prices.
"I think crude oil probably causes (crop) commodity prices to go up more than costs," Schnitkey said.
Another important factor is natural gas, used to make urea, a source for nitrogen fertilizer used on corn. Fertilizer generally accounts for more than 40 percent of the total operating costs for corn, versus 16 percent for soybeans, according to USDA data.
Until the past few years, a rise in oil prices would almost certainly have dragged natural gas higher; however the discovery of decades' worth of cheap domestic shale gas has put a semi-permanent damper on the market, keeping prices at unseasonally low levels even as oil surges.
Partly as a result of the benign natural gas cost, fertilizer prices look to hold steady through the U.S. spring planting season and then soften, said David Asbridge, president of NPK Fertilizer Advisory Services in St. Louis, Missouri.
"At the world level, we've got plenty of nitrogen fertilizer," he said. "We've got a lot of imports coming into the U.S. and there's really no reason for prices to stay as high as they are."
Oil prices have risen to a record premium over natural gas on an energy-equivalent basis. Natural gas futures traded below $4 per million British thermal units (mmBtu) on Friday, near a three-month low.
Political unrest in Libya, which pumps nearly 2 percent of world oil output sent Brent crude prices near $120 a barrel to a 2-1/2 year high on Thursday, before easing off its top on Friday.
All that means the mood in the countryside remains fairly ebullient as corn futures prices hold around $7 a bushel and government agricultural officials look for American farmers to plant 92 million acres to corn this spring, up from 88.2 million acres in 2010/11.
Ethanol makers are expected to consume a record 5 billion bushels of corn this year, or about 36 percent of the harvest, the USDA said.
And with strong global food demand for a growing population, food prices are forecast to rise 3.5 percent this year, nearly double the overall inflation rate.
This year, with natural gas costs staying low, and global demand for short supplies of corn strong, farmers won't be deterred from planting corn.
"This year, with the price of corn where it is, and the yield advantage of corn over soybeans and the fact that it's good to rotate, all of those are in favor of corn holding its acreage," said North Dakota State University agronomist Joel Ransom.
(Additional reporting by Jeanine Prezioso in New York; Editing by Clarence Fernandez and Lisa Shumaker)

© Thomson Reuters 2011 All rights reserved

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Sime Darby palm oil plans in Cameroon

"Sime Darby, the world�s biggest listed palm oil producer, is considering plans for a 300,000 hectare plantation in Cameroon"...


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Africa’s pollution and land grab threat from UN carbon market

Press Release from the Gaia Foundation

Monday 28 February 2011

Africa's pollution and land grab threat from UN carbon market

The United Nation's carbon offset mechanism is rewarding pollution, and could lead to a land grab for industrial biofuels, tree plantations, genetically modified crops and biochar projects in Africa

A new briefing, titled "The CDM in Africa: marketing a new land grab", produced by the Gaia Foundation in collaboration with the African Biodiversity Network, Carbon Trade Watch, Timberwatch Coalition and Biofuelwatch, examines the experience of the United Nation's carbon market, the Clean Development Mechanism (CDM), and looks at emerging threats.

Through the CDM, developed countries claim to offset their emissions, by paying to support developing country projects that are supposed to either reduce greenhouse gas emissions, or absorb carbon dioxide. Until now, only 2% of CDM projects have been located in Africa, as the majority of current projects are connected to industrial emissions. However, increasing numbers of African biofuel and industrial tree plantation projects are entering the CDM pipeline.  Further proposals to include other land-use methodologies could lead to an aggressive African land grab.

The briefing finds that the CDM creates perverse incentives for polluting activities. In the Niger Delta, an oil company is currently paid to stop its illegal gas flaring. In Durban, South Africa, a controversial toxic rubbish dump and community health hazard, which should have been closed years ago, is gaining CDM credits for generating "clean electricity" using methane from the dump as fuel.

Tamra Gilbertson of Carbon Trade Watch explains: "CDM support can end up rewarding companies for their failure to abide by the law.  It subsidizes fossil fuel exploitation, and can undermine efforts to promote waste separation and reduction, while offering little or no financial benefit to the host country and causing harm to local communities."

Wally Menne of Timberwatch Coalition adds, "The supposed climate benefits are often exaggerated and highly questionable, with serious doubts that the projects are `additional' (i.e. would not have happened without CDM support). In Kuyasa, Cape Town, the much-hyped world's first "gold standard" CDM project has still failed to deliver in the 8 years since its launch, having not generated any credits or contributed towards mitigating climate change."

In addition, the authors warn of escalating land grabs for CDM projects.  Anne Maina of the African Biodiversity Network points out, "Africa is expected to make more land available for industrial-scale biofuel and tree plantations for CDM projects.  These will have significant negative impacts on forests, wetlands and grassland ecosystems, affecting small-scale farmers, pastoralists, indigenous peoples and food prices. We challenge the harmful myth that there is plenty of land to spare in Africa."  

A further threat comes from proposals to include new CDM methodologies that consider land use, agriculture and soil practices as "carbon sinks".  Among the technologies being considered is "biochar" which involves the burying of charcoal in soil, supposedly to sequester carbon.

Rachel Smolker of Biofuelwatch points out that: "There is scant evidence that biochar actually sequesters carbon or improves soil fertility.  Support from the CDM or other markets would be extremely premature.  Advocates are nonetheless calling for half a billion hectares of land dedicated to plantations for biochar feedstocks, as well as the use of massive amounts of agriculture and forestry residues.  This will only exacerbate the current land grab that Africa is already experiencing."

Additional proposals to include crops that are genetically modified for resistance to herbicides are also being considered, as it is claimed that using herbicides instead of tilling for weeds reduces carbon emissions lost from soil.  However, studies cast doubt that this leads to a net reduction of emissions.  Furthermore, the moment a field is ploughed, the "sequestered" carbon emissions are released again.

Teresa Anderson of the Gaia Foundation adds: "African countries have been strong advocates against GM crops, as patented seeds and GM cross-pollination threaten the continent's crop diversity and farmers' rights. The CDM poses a threat to Africa's food security by expanding into these new and unsound methodologies."

The authors warn that African countries hoping for development or financial benefits by hosting CDM projects, should be wary of financial, social and environmental problems, impacts on communities, questionable climate benefits, and the likelihood of few or no real financial rewards.  Instead, the carbon market provides an opportunity to further exploit Africa for its land and resources.


1) The briefing "The CDM in Africa: marketing a new land grab" is a joint briefing co-authored by the Gaia Foundation, African Biodiversity Network, Carbon Trade Watch, Timberwatch and Biofuelwatch.  It can be downloaded at: 

2) More information about the threat to African communities from biofuels can be found in the briefing "Agrofuels and the Myth of the Marginal Lands" by Gaia Foundation, African Biodiversity Network, Biofuelwatch and others:
3) More information about the threat to Africa from biochar can be found in the briefing "Biochar Land Grabbing: the impacts on Africa" by ABN, Biofuelwatch and the Gaia Foundation: Africa briefing(2010).pdf
4) More information regarding the efficacy of GM "no-till" agriculture for carbon sequestration can be found in the "Agricultural Practices and Carbon Sequestration" fact sheet by Union of Concerned Scientists. 

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Environmentalists Say Moratorium on Forest Conversion an Empty Promise

Environmentalists Say Moratorium on Forest Conversion an Empty Promise

Fidelis E. Satriastanti | February 17, 2011

Green activists said on Wednesday that the government's much-hyped plan for a moratorium on new logging concessions would only apply to forests that were already protected in the first place.

The two-year moratorium on new concessions in peatland and primary forests is part of a bilateral agreement with Norway, in exchange for which Indonesia will receive $1 billion in funding for Reducing Emissions from Deforestation and forest Degradation (REDD-plus) activities.

In order for the moratorium to be legally binding from its Jan. 1 start date, it must be backed by a presidential decree, which has yet to be issued.

The Civil Society Organization Common Platform, comprising the groups Greenpeace Southeast Asia, the Indonesian Forum for the Environment (Walhi), the Indonesian Center for Environmental Law and Sawit Watch, a palm oil industry watchdog, said even if enforced, the government's claim that the moratorium would protect more forested areas was blatantly false.

"The government lied about the moratorium, because based on a map [of the affected forest areas], only 41 million hectares will be protected, but these are already categorized as conservation and protected areas," said Teguh Surya, head of international liaison and climate justice at Walhi.

"[The moratorium] will be useless, because even without it, [those forests] are automatically protected anyway."

There are two versions of the draft presidential decree, one submitted by the Forestry Ministry and the other by the presidentially appointed REDD task force.

The ministry's version states the moratorium should apply only to primary forests and peatlands, while the task force's version says secondary forests in peat areas should also be included.

The CSO's newly released "Indicative Indonesian Moratorium Map" shows there are 32.9 million hectares of primary forest, 6.5 million hectares of non-forest peatland and 2.4 million hectares of secondary peat forest, all protected under prevailing regulations.

Kiki Taufik, a geographic information specialist with Greenpeace Southeast Asia, said both versions offered the same thing, though their wording differed.

"It's just a name game between the two drafts," he said.

"The ministry wants to save primary forests and peatland, but doesn't specify what type of peatland. Meanwhile, the task force states it wants to protect primary forests, secondary forests and peatland, but the secondary forests it wants covered are only those in peat areas, so there's no difference."

He said the CSO wanted the moratorium to extend to all secondary forests, which account for the remaining 95 million hectares of the country's forests.

Abetnego Tarigan, director of Sawit Watch, said almost all forested areas in the country were logging areas and categorized as secondary forests.

"The government doesn't take into consideration a forest's ability to recover on its own, so there are plenty of areas that have recovered but are still considered secondary forests," he said.

"This is also why logging permits can be issued for these areas, because they're still secondary forests even though they've recovered."

Abetnego said incorporating secondary forests into the plan would not paralyze the industry.

"Those protesting about including secondary forests in the moratorium are from the extractive industries, such as mining and monoculture [plantations] because they need to cut down all the trees," he said.

He also said businesses should fully support a moratorium because it would provide an opportunity to fix the complicated system for issuing concessions.

"It costs them a lot to get permits now, where you have several regulations overlapping one another," Abetnego said.

"It's completely wrong to say that we'd lose trillions as a result of the moratorium, because the truth is natural resources aren't a creative industry but a basic industry. It's not like software, which needs to be put into use as soon as possible. If we don't use our natural resources, we can hold on to them for the future."


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Sunday, February 27, 2011

Scotland: Councillors vote to fight biomass plant

26th February

Councillors vote to fight biomass plant

CONTROVERSIAL plans for a multi-million pound biomass plant suffered a setback this week.

Forth Energy's proposals for a 100 megawatt development, on Forth Ports' land at Grangemouth Docks, had already generated a large number of objections from residents and Grangemouth community council.

Now Falkirk Council has lodged its official opposition to the proposals.

The council's planning committee yesterday (Wednesday), went against officers' recommendations and voted to oppose, in principle, Forth Energy's plans.

It was claimed a main concern was the lack of information on the impact the development, which would bring significant investment and jobs, would have on air quality in the town.

Councillor Angus MacDonald said: "The good health of 18,000 Grangemouth residents is more important than the 300 jobs the site would bring. This is the wrong site in the wrong place and 75 per cent of residents are against it. It is too close to housing and the Asda superstore. The wood to be used as fuel is to be imported from North America - which is hardly locally sourced. It is clearly not renewable energy if the plant is not close to the actual fuel source."

Councillor Alistair McNeill, who supported Councillor MacDonald's motion to oppose the plans, stated the 300 jobs the development would create would be construction jobs and the plant would only employ around 40 people when it was up and running.

The council's environmental health officers said the information they had been supplied suggested it was unlikely the plant would have an adverse impact on air quality in the town.

Council leader Craig Martin added that the plans were in line with the local authority's planning policies and moved the committee approve the proposals in principle.

He said: "We are not the decision-making body here. We are simply referring our views to Scottish ministers, who will then take their decision at a later date."

However, planning committee convener Billy Buchanan backed the motion to oppose.

He said: "This is one of the biggest applications to come forward to this council so we have to make sure it is of benefit to the wider community. We don't want to be accused in the future of imposing anything which will have an adverse effect on the community. "We would like to see this massive investment in the area, but a lot of questions remain unanswered."


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Friday, February 25, 2011

Spain increases mandatory biofuel blending percentage post-Libya

Spain to lower speed limit as oil prices rise

Spain will lower motorway speed limits, cut train prices and use more biofuel in a bid to combat rising oil prices due to Libya unrest

Bus on the motorway, Spain The maximum speed limit on Spanish motorways will be reduced to 110kph (68mph). Photograph: Carlos Dominguez/Corbis

Spain will lower motorway speed limits, cut train ticket prices and use more biofuel under an emergency energy-saving initiative because of soaring oil prices brought on by unrest in Libya, an official said Friday.

The Libya crisis has sharply reduced exports from the oil-rich nation, and about 13% of the oil Spain consumes comes from Libya.

Deputy prime minister, Alfredo Pérez Rubalcaba, said Spain's energy supply is not in danger, despite shutdowns by oil companies operating in Libya, but the national energy bill will rise significantly because of the sharply higher petroleum prices.

He said a €10 per barrel (£8.50 per barrel) increase in oil prices will cost Spain an extra €500m (£425m) per month.

Spain's energy saving measures will be approved formally next week and take effect on a temporary basis on 7 March.

The maximum speed limit on Spanish motorways is 120kph (75mph) and this will be reduced to 110kph (68mph). The government will rush to print new signs to alert people of the change.

"We are going to go a bit slower and in exchange for that we are going to consume less gasoline and therefore pay less money," Pérez Rubalcaba said. For instance, he said, a car running on petrol will use 15% less fuel at the new, lower speed limit.

The government also will order a 5% reduction in fares on commuter and middle-distance trains by the state railway system Renfe.

"We are going to wage a major campaign to promote public transport, which is always welcome but which in this case is absolutely necessary for us," he said.

Finally, oil companies will also have to add more biofuel to the gasoline and diesel they produce – from the current mandatory 5.8% proportion, up to 7%, the deputy prime minister said.

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Thursday, February 24, 2011

US articles on corn ethanol and food prices

Two articles:
1. 'former President Bill Clinton on Thursday warned farmers not to use so much corn for ethanol fuel that it leads to higher food prices and riots in poor countries.'
2. Despite criticism that using food for fuel was helping to drive up prices, Agriculture Secretary Tom Vilsack told the conference the government had no intention of scaling back on ethanol.  "There is no reason for us to take the foot off the gas," Vilsack told the conference. "This is a great opportunity for us because we can do it all, make no mistake about it."

Bill Clinton: Too much ethanol could lead to food riots

buy this photo Agriculture Secretary Tom Vilsack applauds at left, as former President Bill Clinton waves after addressing the Agriculture Department's Agricultural Outlook Forum in Arlington, Va., Thursday, Feb. 24, 2011. (AP Photo/Cliff Owen)

WASHINGTON — Former President Bill Clinton on Thursday warned farmers not to use so much corn for ethanol fuel that it leads to higher food prices and riots in poor countries.

"We have to become energy independent but we don't want to do it at the expense of food riots," Clinton said at the Agriculture Department's annual agricultural outlook conference, which draws agribusiness executives, university experts and others in the industry from around the country.

The Des Moines Register reported Clinton stopped short of calling for slower biofuel production but said there was a need for some kind of periodic reassessment of the industry. There is a need to "make intelligent decisions with three- to five-year time horizons with the best information we have to maximize the availability of good food at affordable prices," Clinton said. He did not elaborate on the remark and did not take questions after his speech.

Clinton's warning stood in contrast to the more bullish views of Agriculture Secretary Tom Vilsack, who said there "no reason to take the foot off the gas" when it comes to biofuels, because U.S. farmers "can do it all."

Clinton told the outlook forum he believes producing biofuels such as corn-based ethanol is important for reducing U.S. dependence on foreign oil. But, he said, farmers should look beyond domestic production and consider the needs of developing countries.

"We know that the way we produce and consume energy has to change, yet for farmers there are no simple answers," he said. "There is a way for us to do this and to do it right."

Clinton's foundation has worked to develop agribusiness in African countries such as Malawi and Rwanda.

At the department's annual Agricultural Outlook Forum, chief economist Joseph Glauber said food prices are expected to rise this year and corn use for ethanol will continue to grow. He said 37 percent of all U.S. corn production could be used for ethanol by 2012.

The ethanol industry long has said that its production does not significantly drive up food prices and that the price of corn contributes to a tiny percentage of every food dollar.

"The driver behind rising food prices has been and remains oil," said Matt Hartwig of the ethanol industry group Renewable Fuels Association. "Rising oil prices, even before the unrest in the Middle East and Northern Africa, have made everything we buy from food to clothes to oil more expensive."

Other industries, including some cattle feeders, have contended that ethanol contributes to food price spikes, affecting their bottom lines and consumers, too.

After years of boosting subsidized ethanol production, Congress has taken an increasingly skeptical look at the fuel as food prices have fluctuated and cutting spending has become a legislative priority.

More than $5 billion in ethanol tax credits were extended at the end of last year as a part of an end-of-session tax deal. But the new Republican House passed two amendments to a spending bill last weekend that would attempt to slow ethanol use.

Even longtime supporters of ethanol in Congress have acknowledged that the country's mood may mean less support for the ethanol industry. Sen. Charles Grassley, R-Iowa, said this week that he would have to "bite the bullet" if he has to decide between cutting the deficit and supporting the House amendments.

Grassley said his priority is to show voters that Congress has gotten the message of fiscal responsibility after the last election.

"I would have to sacrifice almost anything to get to that point," he said.

Glauber said Thursday that ethanol production is currently running at more than 13 billion gallons a year. Congress has required refiners to blend 36 billion gallons of biofuels, mostly ethanol, into auto fuel by 2022.

Grain supplies to remain thin despite huge U.S. crops

ARLINGTON, Virginia | Thu Feb 24, 2011 10:15am EST

ARLINGTON, Virginia (Reuters) - U.S. farmers will plant massive corn and soybean crops this spring but it may take more than two years to rebuild razor-thin stocks and quell the global surge in grain prices, the U.S. Agriculture Department said on Thursday.

With growing concern among world governments over rising food prices, the U.S. corn stockpile is forecast to be the smallest since 1996 and soybeans would amount to a mere two-week supply by time this year's crops were ready for harvest.

"While it is often said the cure for high prices is high prices, even with additional supplies expected this year, it is likely that the tight stocks-to-use situation will not be entirely mitigated over the course of one or even two growing seasons," USDA Chief Economist Joseph Glauber told the department's annual outlook conference on Thursday.

The planting forecasts were unchanged from the department's projections made earlier this month, surprising some analysts that the department didn't trim the numbers somewhat.

"It should be bullish all around even though the USDA stuck to their higher estimates than I probably would have done," said Jack Scoville, analyst for Price Futures Group.

"It seems to me they're implying some very strong demand here because the ending stocks estimates remain pretty tight, really across the board," he added.

U.S. farmers will plant the second largest corn crop since 1944 at 92 million acres and plant 78 million acres with soybeans, a record amount.

USDA projects the corn crop to be a record 13.73 billion bushels, down from the initial estimate of 13.755 billion. The U.S. soy crop will reach 3.345 billion bushels, down from USDA's initial estimate of 3.355 million.

The USDA pegged 2011/12 U.S. corn ending stocks at 865 million bushels, and soybeans stocks at 160 million bushels.

Ethanol makers are expected to consume a record 5 billion bushels of corn this year, or some 36 percent of the harvest.

Despite criticism that using food for fuel was helping to drive up prices, Agriculture Secretary Tom Vilsack told the conference the government had no intention of scaling back on ethanol.

"There is no reason for us to take the foot off the gas," Vilsack told the conference. "This is a great opportunity for us because we can do it all, make no mistake about it."

Despite a recent pullback, agricultural commodity prices have surged during the last year to their highest levels since the 2008 global food scare following catastrophic storms and droughts that have slammed the world's leading agriculture countries.

Tight global commodity stockpiles have pushed food prices higher, making it harder for the poor and contributing to political unrest in countries with high poverty rates and unemployment.

The turmoil has highlighted the need for farmers in the United States, the world's biggest exporter, to grow larger crops this year and replenish tight supplies.

(Reporting by Charles Abbott and Christopher Doering; Writing Russell Blinch; Editing by Lisa Shumaker)

Councillor Andrew Boswell
Green Party Group Chair, Norfolk County Council
E:;  T: 01603-613798, M 07787127881

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Wednesday, February 23, 2011

US House votes to block E15: Analysis: U.S. Resolute On Ethanol


Report: House votes 'overwhelmingly' to block E15 fuel

Ethanol E15 Warning According to The Detroit News, the U.S. House of Representatives has voted to block the Environmental Protection Agency from moving toward a higher blend of ethanol in America's gasoline. Representatives voted 286-135 against allowing the EPA to issue a waiver that would allow gas stations to sell E15. Currently, fueling stations are only allowed to sell E10, which contains up to 10 percent of the biofuel. The new legislation would allow a 50-percent increase in the amount of ethanol sold in each gallon of gasoline. Representative John Sullivan (R-Oklahoma) attached an amendment to the bill to provide funding for the U.S. government through September, effectively killing the legislation.

While The Renewable Fuels Association criticized the decision to stop the E15 waiver, several groups were thoroughly against the increase in ethanol. Those include everyone from the Specialty Equipment Market Association to the American Bakers Association.

The EPA has already approved E15 for vehicles made after 2001, but some groups worry that a higher blend across the board could wind up corroding older engines. Meanwhile, proponents of the increase claim that larger ethanol quantities will help lower America's dependence on foreign oil.

[Source: The Detroit News]

Analysis: In Food Vs Fuel Debate, U.S. Resolute On Ethanol

Date: 15-Feb-11
Country: USA
Author: Timothy Gardner and Charles Abbott

Analysis: In Food Vs Fuel Debate, U.S. Resolute On Ethanol Photo: Reuters/Mark Blinch
A process operator shows a handful of corn at the GreenField Ethanol plant in Chatham, Ontario, in this April 10, 2008 file photo.
Photo: Reuters/Mark Blinch

As world food prices reach new highs, a handful of U.S. politicians and hard-hit corporations are readying a fresh effort to forestall the use of more U.S. corn and soybeans as motor fuel.
They are likely doing so in vain, say experts.
Unlike in 2008, when a wave of global panic over grain supplies provoked a fierce "food vs fuel" debate, there's so far only muted outcry over biofuels, even after corn surged last week to within 10 percent of its 2008 peak following a forecast showing even higher use in the ethanol sector.
While that may yet change as higher prices fuel inflation and trigger worries over supply security, officials and experts say ethanol is too ingrained in public policy and the economy of the U.S. heartland to be easily dislodged.
"What would it take for this public policy to be altered- The answer -- a lot," said Gary Blumenthal of World Perspectives, a private consultant.
"The best voices for demanding change are U.S. consumers themselves, but that will require a food price spike larger than the 2 to 3 percent currently forecast by USDA. And since the Fed focuses on core inflation and ignores food and energy, it gets ignored there as well."
U.S. ethanol production this year will consume 15 percent of the world's corn supply, up from 10 percent in 2008. That share will continue to rise as the industry faces a mandate to boost minimum production an additional 20 percent by 2015. And exports are booming thanks to costly sugar-based rivals.
Ethanol has become a lightning rod for criticism from opponents including foodmakers, livestock feeders, environmentalists and budget hawks.
The largest U.S. meatpacker, Tyson Foods Inc, which also raises chickens, and No. 1 pork processor Smithfield Foods Inc, which raises hogs, say ethanol drives up feed costs sharply and hurts consumers.
"It makes a lot more sense for us to burn our trash than burn our feed," Tyson CEO Donnie Smith said last month.
As yet, foes have not found an electric argument to compel broad-scale change.
On the global stage, the hand-wringing over soaring prices has focused on markets, not biofuel.
French President Nicolas Sarkozy, who has made food security a centerpiece of his one-year term leading the Group of 20 leading economies, has called for rules to curb commodity volatility, not to roll back widespread efforts to convert more crops to fuel.
That finding has the support of a World Bank study released last July, that said: "The effect of biofuels on food prices has not been as large as originally thought, but that the use of commodities by financial investors ... may have been partly responsible for the 2007-08 spike."
But with spending cuts the top issue for lawmakers this year, ethanol subsidies may be swept into the deficit debate.
"Before this (debate) is over ... I suspect a lot of things will be looked at," said House Agriculture Committee Chairman Frank Lucas of Oklahoma, where major industries are ranching and oil and gas -- two sectors skeptical of ethanol.
Backtracking on existing ethanol mandates would be almost unthinkable at this point. At some 900,000 barrels per day (bpd), ethanol now makes up about 10 percent of the gasoline pool in the world's largest oil consumer.
"The fact is the industry has pretty much been built," Joe Glauber said this week. "This isn't a question of just saying 'cut it off.' It's much more complicated than that."
And food prices, at least at home, have yet to pinch.
Prices at U.S. grocery stores and restaurants shot up 5.5 percent in 2008 without inspiring an ethanol overhaul. They were a negligible 1.8 percent in 2009 and a tiny 0.8 percent last year, so 2.5 percent may seem large this year. The overall inflation rate is forecast for 1.9 percent.
Nor is there great political will to make it an issue.
Republicans, including the Tea Party caucus, pushing for deep budget cuts, could single out the 45-cents-a-gallon fuel tax credit that encourages biofuel production, and helps ensure the sector remains profitable.
But at $6 billion a year, they are a drop in the U.S. budget bucket, and overturning them would likely face stiff opposition from President Barack Obama -- whose determination to boost domestic resources is as resolute as his predecessors.
"Biofuels continue to be an important component of our clean energy strategy," a White House spokesman said when asked about ethanol, tight corn supplies and rising food prices.
"These home-grown, renewable fuels reduce our dependence on oil and create jobs and rural economic development."
Besides the tax credits, a 2007 law guarantees renewable fuels a rising share of the market. For corn ethanol, the mandate is 12.6 billion gallons this year and 15 billion gallons annually from 2015.
Production is set to reach 13.5 billion gallons this year -- up 46 percent from 9.235 billion gallons in 2008. Makers will exceed the mandate this year due to exports and profit-making moments when ethanol is cheaper than gasoline.
When grain prices skyrocketed in 2008, Texas, home of the U.S. oil industry, asked the Bush administration to halve the ethanol mandate for that year. The request was rejected.
Last year, Congress battled over ethanol subsidies before approving a one-year extension. Senator Dianne Feinstein of California is working on legislation to trim ethanol subsidies. "Federal subsidies and tariffs for ethanol are wrong for our fiscal policy and wrong for the environment and rising commodity prices are another indicator of that," she said.
"It's unfathomable that the corn ethanol industry can continue to assert that using 40 percent of the corn crop has no impact on food stocks or commodity prices," said the Environmental Working Group, an ethanol critic.
Ethanol defenders say that critique ignores the benefit of distillers dried grains, an ethanol co-product that can substitute for corn in livestock rations. Forty million tons of grains are available at lower cost than corn, they say.
Comparatively small numbers of lawmakers oppose corn ethanol, while farm-state lawmakers are a strong bloc of support. Last year, the argument centered on possible cuts in the tax credits rather than elimination of them.
The major U.S. makers are privately owned POET, Archer Daniels Midland Co and Valero Energy Corp.
Advanced biofuels, such as ethanol from cellulose found in grass and woody plants, are the darling of corn ethanol critics. But the next-generation fuels amount to only a trickle of output and will need years to grow.
"Without ethanol, you have to have 10 percent more gas derived from oil. If you look at the impact on consumers, it would be huge," said Tom Buis of the ethanol trade group Growth Energy.
(Editing by Russell Blinch)

© Thomson Reuters 2011 All rights reserved

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U.N. Biodiversity Panel Could Guide On Trade, Farms

U.N. Biodiversity Panel Could Guide On Trade, Farms

Date: 18-Feb-11
Country: NORWAY
Author: Alister Doyle

A U.N. scientific panel meant to help safeguard animal and plant species should help guide governments with practical studies of issues such as trade, farming or energy, experts said on Thursday.
They said the panel, whose role has not yet been clearly defined, should also do more to value nature. Past studies have estimated, for instance, that the world's coral reefs provide annual services worth $172 billion, from fisheries to tourism.
"Knowing likely consequences of alternative policy options is critical to the choice of the best strategy," four leading experts wrote in the journal Science, urging the panel to help predict the impact of government choices on nature.
Environment ministers from around the world will meet in Nairobi next week to discuss how to set up the Intergovernmental Platform on Biodiversity and Ecosystem Services (IPBES), inspired by a U.N. panel on climate change.
The panel of climate experts focuses largely on impacts of greenhouse gas emissions, often over a century and on a global scale. The authors urged a more practical, shorter-term focus for the IPBES, often looking at regional effects.
"The IPBES should be given rather more specific policies and programs," lead author Charles Perrings of Arizona State University told Reuters in a telephone interview.
Governments agreed last year to set up IPBES after warnings that the world is facing the fastest pace of extinctions since the dinosaurs vanished 65 million years ago, hit by factors such as expanding cities, farms, pollution and climate change.
Perrings said studies might be, for instance, of the impacts of stricter world trade rules to try to slow a spread of insect pests, or of the effects on nature of setting aside more cropland to produce biofuels.
In recent years, efforts to promote biofuels had often fallen short of hopes for curbing greenhouse gas emissions from burning fossil fuels and contributed to driving up world food prices. Biofuels could also add pressures for deforestation.
" stimulate biofuels production in the United States moved too fast," Harold Mooney, of Stanford University and one of the authors, told Reuters. A scientific assessment in advance might have rung alarm bells.
Perrings said that scientists still knew little about the value of natural services despite a U.N. backed study, The Economics of Ecosystems and Biodiversity.
"It will be a critical part of IPBES," he said of efforts to value nature. One study, for instance, showed that planting mangroves along a coastline in Vietnam cost $1.1 million but saved $7.3 million a year in maintaining dykes.
Governments agreed at a meeting in Japan last year to stem the loss of animal and plant species with a sweeping plan of targets for 2020.

© Thomson Reuters 2011 All rights reserved

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The palm oil PR offensive is gathering pace – but not weight

The palm oil PR offensive is gathering pace – but not weight

An Adam Smith Institute report is the latest development as the palm oil industry attempts to rebrand itself as 'the good guys', but many of its claims appear to be unfounded

Orangutan and baby in Borneo, South East Asia
An orang-utan and baby in Borneo. Photograph: Tim Davis/Getty
Last week, I received an email from the Adam Smith Institute alerting me to a new briefing paper it is publishing this week. The ASI must have known that the title would catch my eye – and indeed it did: "Dispelling the myths: Palm oil and the environmental lobby."
The ASI bills itself as the "one of the world's leading thinktanks" and says that its aim is to "promote free markets, limited government, and an open society". It is known for being one of the chief policy architects of privatisation and the poll tax during the Thatcher era.
With this kind of pedigree, I was intrigued to see what the ASI's views on palm oil might be. I already had an inkling what its views on the "environmental lobby" might be (clue: not positive), but I wasn't aware that it had ever passed judgment on the merits of south-east Asia's highly controversial palm oil plantations.
But something else intrigued me: the timing of the paper. It was only a few weeks since I wrote about Tory MEP Roger Helmer, who had been flown out to Malaysia by the palm oil industry to give a speech in which he advised it how it could better lobby Brussels. Earlier this month the world's second largest palm oil producer, Golden Agri-Resources, signed an agreement with conservation group the Forest Trust. And just last week a major Malaysian palm oil producer approached the Guardian with an offer to take a journalist on a tour of one of its plantations – the offer was declined. But did all this signal that the palm oil industry in Malaysia had launched a new offensive to improve its reputation in Europe, and in particular was it trying to use free-market, libertarian advocates such as the ASI and Helmer to do its bidding?
The ASI paper itself (pdf) contains few surprises. To support its case, the paper largely draws on three sources: the Malaysian Timber Council, the Malaysian Palm Oil Council and the Taxpayers' Alliance. In doing so, it attacks the "green lobby" on fairly predictable ideological lines, such as believing that "capitalism is responsible for a widespread collapse in habitat". It adds that palm oil plantations act as useful carbon sinks – "a fact ignored entirely by the green lobby" – and that "environmentalists' fundamental opposition to agriculture development" is a "key contributor" to the growing worldwide food crisis. The ASI paper is also critical of green NGOs receiving funds from the EU, as well as their claim that Malaysia's plantations in particular are a threat to the orang-utan. In conclusion, it states:
It's time we questioned many of the claims and assertions made by the green lobby. The cultivation of palm oil is perhaps one of the best examples of such current controversies. It turns out that under closer analysis some of the key criticisms of both the industry and countries such as Malaysia are flawed.
Adopting high-profile endangered animals is a cynical device to win more support and funding for green NGOs such as Friends of the Earth and WWF. We should take the Malaysian example as a sign to reassess many assumptions about the environmental impact of industry in the developing world, and remember that our well-meaning sentimentality can have profoundly negative consequences for people trying to work their way out of poverty.
Given its supportive stance, one immediate and obvious question to ask is did the palm oil industry commission the ASI to write this briefing paper, or in anyway influence it? I put just this question to the thinktank. It replied:
The ASI commissioned the briefing paper as we thought it was an interesting topic that hadn't been explored and did not receive any funding from any external groups.
Fair enough. No obvious wiggle room in that answer. I also noticed that the paper's author, and the ASI chairman, Keith Boyfield, runs a consultancy called Keith Boyfield Associates which "helps clients to improve their international competitiveness". Its website lists some well-known clients including BNFL, JP Morgan and the Society of Motor Manufacturers & Traders. Was it possible the consultancy's clients include a representative of the palm oil industry? I called Boyfield and asked how he'd come to write the paper. He said:
Eamonn Butler, the director of the Adam Smith Institute, and myself attended a lunchtime seminar organised by the Institute of Economic Affairs, where I'm a fellow, about this whole controversy and debate about palm oils. They had some speakers there including the guy who is the minister of commodities for the Malaysian government. I found myself sat next to his private secretary and he got me interested. There were two people who asked questions after the seminar, Eamonn and myself. I asked: 'Why is it that you've been making such a poor hand at trying to get your point of view across?'
I'd been reading into this subject and seen things hadn't worked out very well for Indonesia. But then I looked at the Malaysian case and I thought there was an argument to say that the palm oil plantations on the Malaysian peninsular when not damaging to the orang-utans because they were never there, but rather that they were in Borneo where it looked as if there had indeed been some erosion of rainforests. But from what I've read and heard, the Malaysian side have a relatively strong argument that they are looking after rainforests and that they've even been creating nature reserves. Sometimes you get the idea that Malaysians are rabidly cutting down rainforests. But I wanted to argue that there needs to be a little more balance about where the orang-utans actually live. If anyone has got counter arguments, that's fine. I'd be very interested in seeing them.
Boyfield confirmed that his consultancy has "no links with the palm oil industry in anyway". He added that he was on the Taxpayer's Alliance advisory board and that "he was once in a restaurant in Brussels with Roger Helmer about three years ago", but said he not had any dealings with him since and certainly not over this matter. He also said he would soon be writing up the paper as an article for the Wall Street Journal, where he has had pieces published in the past.
Unsurprisingly, the "green lobby" has also noticed the ASI paper and is keen to correct its, as one representative put it, "nonsense". This is the response I received from Kenneth Richter, the Friends of the Earth's biofuel campaigner:
The link between rapid palm oil expansion and deforestation is clear and has been confirmed by leading scientists. In 2007, the United Nations concluded that today's rapid growth in plantations is "one of the greatest threats to orang-utans and the forests on which they depend", and now "the primary cause of permanent rainforest loss" in Malaysia and Indonesia.
Leading scientists have refuted the palm oil lobby's claim that palm oil plantations are better carbon sinks than the forests or peat lands they are replacing.
It seems far-fetched and unfounded to blame the suspension of World Bank funding for palm oil corporations for the rise in food prices – in fact, research by the OECD and the World Bank has confirmed that growing crops for biofuels in place of food has been a contributing factor to this problem.
To avoid trashing rainforests, land grabbing, and increasing climate changing emissions, the UK government must urgently scrap targets for biofuels – the fastest growing demand for palm oil – as well as investing in greener cars and public transport.
The ASI paper aims much of its ire at WWF. This is what a WWF representative told me in response:
In light of our commitment to work with all actors, from local communities to producers, retailers and consumers, on an issue like palm oil, it is bizarre to claim that WWF has an "ideological opposition to economic development". In fact, industry agrees with us, hence the willingness of businesses to work with us on developing sustainable certification standards.
Moreover, to suggest, as the authors of the report do, that we are opposed to agricultural development and that this opposition has contributed the growing worldwide food crisis and to riots in the streets of developing countries is entirely without basis.
In fact, we are keen to engage with progressive businesses of all kinds across a wide range of sectors, and we actively support sustainable growth in sectors like plantation agriculture – entirely contrary to the suggestions of the report.
Elsewhere it may be true, as the report says, that palm oil plantations can be a sink for carbon; but when they replace high-carbon habitats like wetlands, peat soils and forests then they will be a net emitter.
Indeed, Indonesia's biggest oil palm grower, Golden Agri-Resources, have recently announced a ban on all further palm oil expansion onto land containing more than 35 tonnes per hectare of carbon – not something they would do unless they were convinced that in terms of climate change it does not make sense to replace forests and peat with palm oil.
In addition Sime Darby, one of Malaysia's largest palm oil producers, has also now committed to produce carbon-neutral palm oil as well as to being fully RSPO certified – recognising that sustainability in palm oil is not only possible but also desirable.
On the matter of funding: environmental NGOs – including WWF – receive money for the expertise they provide to European institutions. Without this support, only corporate and industry interests would be represented at EU level. Many such NGOs are involved in working groups and "high level groups" that require time and resources and, unfortunately, we cannot provide this without financial help.
The grant we receive to operate in Brussels under the "Life+ regulation" was approved by both the European Parliament and the Council of Ministers; there is broad political consensus on the need of such funds. The funds are transparent and all recipients are known and accountable to their objectives.
WWF has almost 5 million members around the world, approximately 3 million of which are in Europe. These citizens want to see the WWF mission fulfilled at local, national and international level and our role in Brussels is crucial if we are to be successful.
We've always been entirely transparent about our sources of funding and receiving public funds for the work that we do is an entirely legitimate part of a healthy, democratic process.
Meanwhile, a Greenpeace spokesman said:
The Adam Smith Institute has exposed the ongoing effort to reposition the Malaysian palm oil industry as the good guys, free from peatland emissions or habitat destruction. Yet they can't see that all-out reality denial is exactly what gives the industry a bad name whilst simultaneously harming the efforts of those companies that are working to tackle these problems.
Palm oil is a highly controversial commodity: that much we already knew. But this clear change of gear in the battle to win over public opinion suggests we will be hearing much more about this ubiquitous product in coming months.

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Journal of Peasant Studies

Journal of Peasant Studies, Volume 37 Issue 4 2010, Biofuels, Land and
Agrarian Change is free to download until the end of March.

Many academic articles about biofuels and agrarian change:

The politics of biofuels, land and agrarian change: editors' introduction
Saturnino M. Borras Jr.; Philip McMichael; Ian Scoones
Pages 575 – 592

Agrofuels capitalism: a view from political economy
Ben White; Anirban Dasgupta
Pages 593 – 607

Agrofuels in the food regime
Philip McMichael
Pages 609 – 629

Forests, food, and fuel in the tropics: the uneven social and
ecological consequences of the emerging political economy of biofuels
Peter Dauvergne; Kate J. Neville
Pages 631 – 660

Assumptions in the European Union biofuels policy: frictions with
experiences in Germany, Brazil and Mozambique
Jennifer Franco; Les Levidow; David Fig; Lucia Goldfarb; Mireille
Hönicke; Maria Luisa Mendonça
Pages 661 – 698

Power is sweet: sugarcane in the global ethanol assemblage
Gail Hollander
Pages 699 – 721

Fields of dreams: negotiating an ethanol agenda in the Midwest United
Sean Gillon
Pages 723 – 748

Biofuels in Brazil: debates and impacts
John Wilkinson; Selena Herrera
Pages 749 – 768

Biofuel, dairy production and beef in Brazil: competing claims on land
use in São Paulo state
Andre Novo; Kees Jansen; Maja Slingerland; Ken Giller
Pages 769 – 792

Agrofuel policies in Brazil: paradigmatic and territorial disputes
Bernardo Mançano Fernandes; Clifford Andrew Welch; Elienaí Constantino
Pages 793 – 819

Processes of inclusion and adverse incorporation: oil palm and agrarian
change in Sumatra, Indonesia
John F. McCarthy
Pages 821 – 850

The biofuel connection – transnational activism and the palm oil boom
Oliver Pye
Pages 851 – 874

The political ecology of Jatropha plantations for biodiesel in Tamil
Nadu, India
Pere Ariza-Montobbio; Sharachchandra Lele; Giorgos Kallis; Joan
Pages 875 – 897

Over the heads of local people: consultation, consent, and recompense
in large-scale land deals for biofuels projects in Africa
Sonja Vermeulen; Lorenzo Cotula
Pages 899 – 916

Big Sugar in southern Africa: rural development and the perverted
potential of sugar/ethanol exports
Ben Richardson
Pages 917 – 938

The politics of Jatropha-based biofuels in Kenya: convergence and
divergence among NGOs, donors, government officials and farmers
Carol Hunsberger
Pages 939 – 962

(my apologies if this was posted before on this list, but I haven't
noticed it)


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Aviation biofuels conference - Rotterdam 22 - 24 March "World Biofuels Markets"

Aviation Biofuels conference in Rotterdam 22 to 24th March 2011
organised by World Biofuels Markets

"Biofuels could reduce aircraft emissions by 80%"

More than 2 billion people enjoy the benefits of flying each year yet the commercial aviation industry produces around 677 million tonnes of carbon dioxide per year. The industry has identified biofuels as a major way it can reduce its greenhouse gas emissions.

This is the start of something extraordinary, but challenges remain.

Green Air Online is pleased to partner with the World Biofuels Markets, where you can meet representatives from the aviation industry and hear best practice from the associated areas of Biofuels Standards, Advanced Biofuels and Investment. You will also benefit from first-hand experiences of 250 experts, including 50 CEOs and Presidents who are driving the future development of biofuels at Europe's largest biofuels congress and exhibition. Visit for more information.

A full days programme will be dedicated to Aviation Biofuels at World Biofuels Markets 2011. View the agenda online at the" target="_blank"> WBM 2011 website.

Our Aviation Biofuels session is part of the 6th annual World Biofuels Markets: Where the biofuels industry meets to do business. Around 2,000 attendees are expected over three intense days of high-level content and unrivalled networking opportunities.

Amongst the speakers already confirmed for 2011 are:

Jan Ernst de Groot, Board Member, KLM
Mark Watson, Head of Environmental Affairs, Cathay Pacific Airways
Jonathon Counsell, Head of Environment, IATA Environmental Committee Members, British Airways
Joachim Buse, Head of Aviation Biofuel, Lufthansa
Martin Porsgaard Nielsen, Manager, Environment and Sustainability, SAS Group
Lourdes Maurice, Chief Scientific and Technical Advisor for Environment, Federal Aviation Administration
Dirk Kronemeijer, Managing Director, SkyNRG & Vice President, Business Innovation, KLM
Joe Bauer, Director of Asset Management, NetJets
Paul Nash, Head of New Energies, Airbus
Jonathan Hart, Environment Strategy Manager, Civil Aerospace, Rolls-Royce

Key topics include:

• Commercialisation of Aviation Biofuels
• Policy, Certification and Fuel Approval
• Developing New Sources for Sustainable Aviation Fuels
• Conversion Technologies and Processing Feedstocks for Aviation

If you haven't already, download our brochure now for the updated full agenda outline and confirmed speakers at:

To register your place:
Call: +44 (0)20 7099 0600
Or book online at

Large group discounts are available – enquire when you get in touch.

I look forward to meeting you next month.

Kind regards,
Claire Poole
World Biofuels Manager

T: +44 (0) 203 355 4227
F: +44 (0) 207 900 1853


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The palm oil PR offensive is gathering pace – but not weight

An Adam Smith Institute report is the latest development as the palm oil industry attempts to rebrand itself as 'the good guys', but many of its claims appear to be unfounded.


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Controversial Logging Exposes Sweden's Hollow Forest Policy

[Note that Sweden is one the countries from which UK energy companies such as Forth Energy state that they intend to source wood for bioenergy from.]

Protect the Forest & Friends of the Earth Sweden Press release - February
23rd, 2011

Controversial Logging Exposes Sweden's Hollow Forest Policy

The Swedish Forest Agency has recently granted permission to log pristine subalpine forest in a vast roadless wilderness. Protect the Forest and Friends of the Earth Sweden now condemn the Swedish forest policy and the Swedish forestry model. The two environmental organisations demand a radical
improvement of the forest management legislation.

The Änok river delta is located in the heart of one of Europe's last expanses of wilderness, bordering on the UNESCO World Heritage Laponia and only a few kilometers away from Sarek National Park. The forests along the delta are some of the finest virgin pine forests that remain in the country. There is no doubt from either environmental protection authorities or environmental NGO's that the area is of high conservation value. Despite this, the Swedish Forest Agency has recently authorized permission for clear-cutting subalpine old-growth forest in the middle of the Änok river

"Virgin forest logging in Änok is a good example of how Swedish forest management legislation lacks the capacity to balance the interests of conservation and production", says Daniel Rutschman, secretary of Protect the Forest. "In combination with the severe cuts in state funding for forest
protection, the Swedish forest policy has now totally collapsed."

During the UN biodiversity summit last fall, Sweden and 192 other countries signed an international agreement which established that at least 17 percent of each land based ecosystem must be protected until the year 2020. This corresponds to the demands of the environmental movement and scientists(1),
who argue that at least 20 percent of the productive forest land must be protected. However, none of the tools needed to realize the ambitions have been presented by the government, and there is no legislation in support of the environmental targets. The environmental movement is also critical to
Swedish authorities for not using the existing EU-legislation concerning species and habitats.

"The Swedish forestry model, based on voluntary nature consideration, has proved insufficient", states Ellie Cijvat, chairperson of Friends of the Earth Sweden. "The forest industry has proved themselves unable to take this kind of responsibilty. It is time for Sweden to pass legislation which will protect remaining old-growth forests and core areas. We need a legal framework which guarantees environmentally sound forestry, so that necessary consideration is taken to soil, water and biodiversity; a framework which stimulates low-impact, nature oriented management methods".

Protect the Forest and Friends of the Earth Sweden hold that the destruction of the Swedish forest ecosystem immediately must cease, and that valuable areas like the Änok river delta must be protected from exploitation.   Therefore the two environmental organisations have initiated an international call for action, under the name of "Stop the Logging of the Änok delta(2)".

1. More than 200 scientist support the appeal "Protect Sweden's Old-Growth Forests" Read more about it here: 

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Drax raises biomass project hopes

Drax raises biomass project hopes

Drax said it hoped government incentives would help it proceed with a £2bn biomass project later this year.

The power station owner said the initial results of a government consultation on renewable energy prices, which will also determine subsidies, could decide if the delayed £2bn plans to build up to three biomass plants in the UK, along with Germany's Siemens (SIEMENS.BO - news) , go ahead.

Drax said it expected to have an indication by the "second half" of the year. The consultation, or Renewables Obligation banding review, forms part of government plans to meet the European Union target for 15 per cent of energy to come from renewable sources by 2020.

Dorothy Thompson, chief executive, said Drax could generate a majority of its power using biomass through co-firing - burning biomass from straw or other plant material alongside coal. "Drax has the capability of being a biomass dominated site . . . [but] this is dependent on getting the appropriate regulatory support. We expect some visibility in the second half of the year . . . it's a big year for us," she said. In its annual results to December 31, Drax, owner of Europe (news) 's largest coal-fired power station, doubled its dividend from 13.7p to 32p on the back of high energy prices.

Drax said it had managed to forward sell about 90 per cent of its 2010 output compared with a long-term average of 60 per cent.

Revenues, up from £1.48bn to £1.65bn, were also spurred by a record demand for power amid the freezing conditions at the end of 2010. Pre-tax profits increased from £157.8m to £254.9m and earnings per share rose from 31p to 52p.

The shares rose 6.2p to 401.1p.

FT Comment

Karl Marx's quote about men making history but not in circumstances of their own making could describe Drax's current predicament. In spite of bumper profits the group is not necessarily in control of its own destiny. Drax hopes its future lies in carbon-lite biomass, hence why it more than doubled its biomass burn from 400,000 tonnes to 907,000 tonnes. The fact this remains a fraction of its 9.4m tonne 2010 coal usage is indicative of government support, or lack of it, compared with other renewable energy sources such as wind. Drax currently trades at just under 9 times 2011 earnings, a discount to the utilities sector average of 13 times. Whether that proves to be good value could depend on Whitehall.

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Tuesday, February 22, 2011

Put a question to David Cameron, by midnight GMT tonight

Submit a question for Al Jazeera to put to UK Prime Minister David Cameron, as part of its World View series

Questions must be submitted by midnight GMT tonight, by text or video:

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Monday, February 21, 2011

New UNEP Assessment on Black Carbon and Tropospheric Ozone

36 page summary for decision makers here

(being presented this week in Nairobi at UNEP Global Council meeting

Key points for bio-energy:

1. Black Carbon and Tropospheric Ozone are significant global warming forcing agents. As well as impacting on crop yields and human health.
2. Both are caused by combustion processes. Diesel engines without Level 3 Particulate Filters are a major source of Black Carbon. Similarly inefficient solid biomass burners like cooking stoves
3. Both are short-lived global warming agents, but are much more potent than CO2.
4. Mitigation measures to reduce BC and Ozone will have a more immediate beneficial effect on climate than measures to reduce CO2.

Bio-energy generation is reliant on combustion and will always be a possible source of Ozone and BC. The UK has no mechanism to attribute global warming effects to large scale bio-energy schemes like bioliquid and biomass power stations.

From the Conclusion to the Assessment:

"...this Assessment does not in any way suggest postponing immediate and aggressive global action on anthropogenic greenhouse gases; in fact it requires such action on CO2. This Assessment concludes that the chance of success with such longer-term measures can be greatly enhanced by simultaneously addressing shortlived climate forcers.

The benefits identified in this Assessment can be realised with a concerted effort globally to reduce the concentrations of black carbon and tropospheric ozone. A strategy to achieve this, when developed and implemented, will lead to considerable benefits for human well-being."


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Sunday, February 20, 2011

Sarawak government mocks its indigenous people

Sarawak government mocks its indigenous people

February 20, 2011

The Sarawak government mocked the plight of its rainforest people in a press release issued earlier this month, says a rights' group.

The release says forest people are poised to benefit from massive dam and forestry projects under the Sarawak Corridor of Renewable Energy (SCORE) scheme that will convert the Malaysian state's rivers into lakes and forests into open pit mines, wood-pulp plantations, and oil palm estates.

"SCORE will develop 10 key industries including hydropower, heavy industry and tourism," stated the release. "Baram, currently a rural and underdeveloped area, will benefit from a new hydro dam. As a result, the district will attract a wide range of industries such as palm oil, pulp and paper and timber which will provide job opportunities for the indigenous people living there."

But the Bruno Manser Fund, a Swiss NGO which works to secure rights for Sarawk's forest people, says these projects will further marginalize groups like the Penan, whose culture and livelihoods are closely tied to healthy forests.

"The statement on SCORE is an outrageous lie," Lukas Straumann of BMF told "The dams cannot be realized without displacing thousands of natives from their traditional lands. This is why the dam projects, in particular the Baram dam, are met with strong resistance from the longhouses."

The Penan, a group of once-nomadic forest tribes, has fiercely resisted loggers and plantation developers. In recent years their strategy for defending their land has mostly transitioned from armed standoffs to taking legal action. But neither has been effective in protecting their forest homeland. Vast swathes of Sarawak's rainforest has been lost, while the government and companies have largely ignored court rulings in favor of the Penan. The government, which has long pushed forest dwelling Penan to leave the forest and settle permanently, has recently made a policy of targeting native customary rights land for conversion to industrial oil palm plantations, which provide few employment opportunities for the Penan.

Critics say the government's interest in these large development projects stems from opportunities for corruption. Sarawak's Chief Minister Abdul Taib Mahmud is believed to have squirreled away hundreds of millions to billions of dollars in ill-gotten gains during his 30 years in power. A recent investigation found that Taib controls properties worth hundreds of millions of dollars in Canada, Australia, the U.K. and the U.S. despite earning a salary of less than $200,000 a year.

"It is also known that SCORE is a scheme linked to massive corruption in the building sector," said Straumann. "Sarawak's main construction companies (CMS, Naim Cendera etc.) are closely linked to the family of Taib Mahmud who is hoping to enrich himself further with these unnecessary dam projects (there is a power glut in Sarawak already). We prefer to rename it SCORR - Sarawak Corridor of Corruption."


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Friday, February 18, 2011

Cellulosic Ethanol Reality Begins to Set In


"It is great to have lofty goals, but when you start to base your energy policy on fairy dust, you are setting yourself up for massive problems down the road. Technology breakthroughs can't simply be mandated. Sometimes critical breakthroughs happen, and sometimes they don't. In the case of cellulosic ethanol, commercial viability remains out of sight."

Cellulosic Ethanol Reality Begins to Set In

Tagged with: , , , , 
Posted by Robert Rapier on Wednesday, December 1, 2010

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Delusional Mandates

It is hard to believe that just a few short years ago, Congress mandated a massive increase in usage of cellulosic ethanol. This was remarkable, because no commercial cellulosic ethanol facilities even existed at the time. But people like Vinod Khosla were busy testifying before Congress that the only thing holding the industry back was more funding, and if they would provide the funding we could replace all of our gasoline consumption with cellulosic ethanol.

So Congress mandated  in the 2007 Energy Independence and Security Act that we would use 100 million gallons of cellulosic ethanol in 2010, 250 million gallons in 2011, and then rapidly expand to 16 billion gallons per year by 2022. At the time, I saw a very appropriate analogy that summed up the situation: "It's like trying to solve a traffic problem by mandating hovercraft. Except we don't have hovercraft."

I tried to bring a dose of reality to the debate in this blog. I have worked on cellulosic ethanol myself. I know first hand the challenges. Biomass has low energy density relative to fossil fuels, and thus a conversion facility must have easy logistical access. In most cases, this means that biomass must be sourced close to the facility. This puts some limits on the size of biomass facilities, so they suffer from the lack of economies of scale. I have harped on this logistical issue for years, and anewly released study from Purdue reiterates the points I have made: "Without solving the logistical issues, commercial production of second-generation biofuels will not take place."

Further, cellulose generally makes up less than 50% of the composition of biomass, limiting the biomass fraction that can be converted into ethanol. The fraction that is converted ends up as a dilute beer of generally around 4% ethanol and 96% water. This makes the energy requirements of purifying cellulosic ethanol very high. Of course if you listen to Bob Dinneen and the guys at the Renewable Fuels Association (RFA), they say the issue is that not enough money is being thrown at the problem. But that's their answer to anything ethanol-related: We need more money.

Commercialization attempts for cellulosic ethanol date back over 100 years. Germany was the first to commercialize cellulosic ethanol in 1898. Commercialization came to the U.S. in 1910, when Standard Alcohol Company built a cellulosic ethanol plant in Georgetown, South Carolina to process waste wood from a lumber mill. Standard Alcohol later built a second plant in Fullteron, Louisiana. Each plant was designed for 5,000 gallons of ethanol per day from wood waste, and both were in production for several years. Both plants were eventually closed due to lack of economic viability.

Snap Back to Reality

In early 2010, 100 years after the first cellulosic ethanol plant was built in the U.S., the EPA recognized that the cellulosic ethanol mandates could not be met. They subsequently reduced the 100 million gallon mandate for 2010 to 6.5 million gallons. (Actual qualifying production of cellulosic ethanol through October 2010 is zero gallons). MIT Technology Review posed the question What's Holding Biofuels Back? I responded with the answer in What's Really Holding Cellulosic Biofuels Back. I have maintained that future mandates would also have to be cut, and the EIA recently indicated that they agree, at least for 2011:

EIA cuts cellulosic producers from 2011 list

The U.S. DOE's Energy Information Administration has completed its predictions for next year's cellulosic biofuels production and estimates that actual production levels will be much lower than anticipated. Earlier this year, the U.S. EPA proposed a reduction in the cellulosic biofuels portion of the 2011 renewable fuel standard (RFS) to between 5 and 17.1 million gallons, down drastically from the 250 million gallons initially called for in the 2007 RFS. But according to an Oct. 20 letter sent from EIA Administrator Richard Newell to EPA Administrator Lisa Jackson, the EPA's reduced target is still too high. The EIA suggests that a more likely 2011 production total for cellulosic biofuels is approximately 3.94 million gallons. Additionally, the EIA said half of the facilities on the EPA's list won't produce biofuels next year.

So the EIA projects that 2011 cellulosic ethanol production will be 3.94 million gallons, less than 2% of the originally mandated amount. They suggest that the EPA, having cut the 2011 estimate from 250 million to the range of 5 to 17.1 million gallons, is still much too optimistic, and that half of the facilities that the EPA expects to produce cellulosic fuel will not. Following the EIA story, the EPA has come back and revised their 2011 numbers down to 6.6 million gallons of cellulosic ethanol.

Better Late Than Never

Back to the EIA report, they were quite frank in their assessment of Range Fuels. If you recall, I was the first to point fingers at the vast disconnect between Range Fuels' early, hyped up promises and the constantly diminishing expectations of what they would actually deliver:

Broken Promises from Range Fuels

I contrasted the more than $320 million that they have taken in and the promises of a 100 million gallon cellulosic ethanol plant (which they had said would cost $150 million) with this year's admission that they would only have 4 million gallons of methanol capacity. But you wait, they insisted. They were going to get that plant up on methanol, and then switch over to ethanol and all would be right in the world. But they just needed more money.

Oh, I had my critics. Defenders of Range — including Range themselves — began to come out and insist that I didn't know what I was talking about. Well, the EIA had something to say about that:

Range Fuels Inc., which was excluded from the EPA's proposal, is expected by the EIA to provide 1 million gallons of methanol next year. The plant's Soperton, Ga., capacity is 4 million gallons, however, "we assumed a 25 percent utilization rate due to its repeated inability to meet stated production goals," Newell wrote.

Repeated inability to meet production goals. Range Fuels is starting to look like the of the cellulosic ethanol world. They won't be alone, but they are the highest profile example of cellulosic hype colliding with cellulosic reality.

Conclusion – Technological Breakthroughs Can Not Be Mandated

Personally, I don't believe large-scale commercialization of cellulosic ethanol will ever be viable due to the aforementioned fundamental issues with biomass conversion and efficiency, and will ultimately be relegated to the role of a niche fuel provider (as discussed in Biofuel Niches). The heart of the problem here was the idea that technology can be mandated. Imagine that in 2005 Congress put forward a mandate that lung cancer would be cured by 2010, breast cancer by 2012, and by 2020 all cancers would be cured. People would think they were absolutely daft, because more people understand the difficulties involved in coping with cancer. On the other hand the general public doesn't have a clue of the difficulties in economically turning cellulose into fuel, but they did hear a lot of hypesters in the news saying that it would be easy — as long as you get that Silicon Valley "know how" working on the problem. But the Silicon Valley players learned that Moore's Law doesn't apply to the energy business.

It is great to have lofty goals, but when you start to base your energy policy on fairy dust, you are setting yourself up for massive problems down the road. Technology breakthroughs can't simply be mandated. Sometimes critical breakthroughs happen, and sometimes they don't. In the case of cellulosic ethanol, commercial viability remains out of sight.



Rachel Smolker
Biofuelwatch/Energy Justice Network
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