Another recent article links increased Biofuel production to increasing global food prices.
Biofuels have forced global food prices up by 75% - far more than previously estimated - according to a confidential World Bank report obtained by the Guardian.
The damning unpublished assessment is based on the most detailed analysis of the crisis so far, carried out by an internationally-respected economist at global financial body.
What is interesting is the political angle, which may go some way towards explaining why the Biofuel industry is being encouraged by governments the world over.
The figure emphatically contradicts the US government’s claims that plant-derived fuels contribute less than 3% to food-price rises. It will add to pressure on governments in Washington and across Europe, which have turned to plant-derived fuels to reduce emissions of greenhouse gases and reduce their dependence on imported oil.
Hopefully, the pending G8 meeting will not be subject to too much politicalisation (if that is even possible at a G8 meeting).
The news comes at a critical point in the world’s negotiations on biofuels policy. Leaders of the G8 industrialised countries meet next week in Hokkaido, Japan, where they will discuss the food crisis and come under intense lobbying from campaigners calling for a moratorium on the use of plant-derived fuels.
Prof. Benjamin Senauer provides some further analysis of the BioFuel industry in a recent comment in guardian.co.uk (July 3), where he argues that the link between biofuel production and rising food prices cannot be ignored.
A recent article by Ross Gittins in the Sydney Morning Herald is an excellent summary of the forces at work in the global economy, particularly those related to recent record high oil and food prices.
A nice summary of the complex and interconnected issues that span increasing demand from China and India, increased bio fuel (Ethanol) production, rising global food prices and climate change.
I’ve been thinking along similar lines for some time and Larry Lindsay of Bagnoo (Sydney) has put it better than I could have in a letter to the Sydney Morning Herald (June 17, 2008).
An E10-blended fuel has about 3 per cent less energy content
than unleaded petrol (”Drivers slow to adopt ethanol”, June 16).
Vehicles on E10 use about 3 per cent more fuel. Motorists get a
discount of three cents a litre on E10. On a per litre price of
$1.65, this equates to a 1.8 per cent discount. Who in their right
mind would be happy with that in exchange for 3 per cent less
mileage?
So where exactly is the economic or environmental value proposition here? Why is the Ethanol industry in Australia subsidised by the Federal Government? Why is it subsidised in a number of other seeming rational counties around the world? Why are ethanol-blended transport fuels being mandated in these same places?
More, importantly, what role have these subsidies had on the price of grain typically used for food production? Has this contributed to recent dramatic global increases in food prices that are typically affecting those least able to pay?
TIME Magazine recently published an article on the environmental impact of the Ethanol Industry, see “The Clean Energy Scam” (March 27, 2008). As always it is the unintended lower order consequences of policy decisions that have the greatest impact.
What happens when the impacts of peak oil and our delayed response to global warming coincide? What will be the economic and social consequences of these two global events? How will we respond?
This week I participated in a scenario planning workshop examining potential futures for our company and our industry. This started me thinking (yet again…) about the likelihood of a ‘perfect storm‘ event where peak oil combines with the pressing need to reduce our global carbon footprint to send shock waves through the existing social and economic structures we take for granted.
I suspect we could have coped with the long term implications of peak oil - albeit well after we should have reacted, making the implications worse and change more radical than it needed to be - if it occurred independent of the need to combat the effects of climate change. Coal can be readily synthesised into liquid fuel via a well established process called gasification. A range other minerals can be processed to yield liquid fuels, eg. shale. However, these processes have a significant carbon footprint, yielding as much as twice the carbon as the petroleum it displaces. A not so minor problem when faced with the need to dramatically reduce carbon emissions…
What can an individual do in the face of such a vast global issue? Well, here are a few things to think about; some of which I intend to discuss in detail at some other time:
- Look for opportunities in your day to day routine where you can Reduce, Reuse and Recycle;
- Reduce your consumption; of energy, ie. electricity, petrol, natural gas, etc, and material use in general;
- Cycle for transport;
- Sign up for green power from your local supplier of electrons.
Tags: Peak Oil