Germany's Biodiesel Blues

Germany's Biodiesel Blues

        For the past several months, German biofuels producers have been complaining that their country's tax on biodiesel has crippled Germany's biodiesel industry. Various news reports have been saying that German biodiesel capacity has been running at 60-70% capacity in 2007.
        "If we will not have any change in our regulation in Germany it is very clear that within the next two years more or less 50 percent of the [biodiesel] capacity in Germany will vanish," Reuters quoted Karl Giersberg, chief financial officer for German producer EOP Biodiesel, as saying.
        This is all due to the biodiesel tax of €0.09 per liter that was implemented in August 2006. The German government had said that the tax, which was to be raised in stages to €0.45 per liter by 2012, was enacted to help offset losses in petroleum tax revenue.   
        The biodiesel companies are hoping that one or more of several actions will take place: that the German government drop a planned tax increase of six cents per liter in 2008, which is an action the conservative Christian Democrats are considering; that tax breaks to farmers are extended, which is what the Social Democratic party is suggesting; that the biodiesel blend in diesel increase from 5% to 7%; and that the biodiesel tax change from a fixed tax to a variable tax based on the price of crude oil.
        The question is, should Germany's government relieve biodiesel producers of the taxes imposed upon them? I may be comparing apples to oranges, but protecting German biodiesel producers from cheap foreign imports reminds me of the attempts by U.S. corn-ethanol producers to protect themselves from cheaper sugar-based ethanol. Of course, ethanol has more controversy surrounding it, from an emissions standpoint. Perhaps the best is from the viewpoint of environmental sustainability: oil from rapeseed, which is used to make biodiesel, doesn't have as much environmental impact as palm oil from Malaysia (which some say causes deforestation).

World's ethanol lobbyists not so much force to be reckoned with

World's ethanol lobbyists not so much a force to be reckoned with

Some $2.3 billion in federal support would flow to biofuels under the Senate farm bill, half of it to develop cellulose as a feedstock for fuel ethanol. Ag Committee chairman Tom Harkin (D-Iowa) said the bill "puts us on a path" to produce 60 billion gallons of biofuels by 2030, roughly 10 times current output.
        At this time, the bill is not written to include a biofuels blending mandate (the Senate energy bill wants to up blending to 36 billion gallons by 2022), but that isn't stopping the farm lobby.
    In fact, the world's ethanol lobbyists took some time from squabbling over protectionist regimes and conducting ridiculous polls to issue a a rare joint statement from Amsterdam yesterday.
        "As oil prices soar to $100 per barrel and declining petroleum reserves become ever more costly to extract, it is vital that we move quickly to expand the production and availability of biofuels such as ethanol," goes the statement by the heads of the Canadian Renewable Fuels Association; the European Bioethanol Fuel Association; the Renewable Fuels Association; and Brazil's Sugar Cane Industry Association.
        Groups such as these are, as of late, either just making a poor showing, or really do have nothing left except demonstrating how confused everybody is. Meanwhile, environmental, economic and social welfare groups, once supportive of ethanol, are now mobilized against it, and using scientific method, however antiquated, to raise concerns that rainforests will be pushed into crop production, food prices will keep rising, and the world's poor will shoulder the burden.

Time To Ecolabel Biofuels

It wasn't too long ago that biofuels were basking in the glow of nearly everyone's approval - a quick fix for reducing CO2 emissions from transport. The EU aims to fill 10% of its transport needs with biofuels by 2020. But biofuel's easy ride may be over. One of Sweden's leading gas chains, OKQ8, last week canceled its plans to introduce a palmoil-based biodiesel to the market after critics like Greenpeace chided the company, saying that palm oil production can be as destructive to the environment as burning fossil fuels. Ethanol has experienced a 100% increase in demand here in the last year due to all the bio-fuel cars now entering the Swedish market, and ethanol producers are also getting criticized for CO2 emissions from its production.

As governments the world over and in Europe rush to subsidize biofuel production the warning lights are flashing brighter. We've reported on the UN's special rapporteur Jean Zigler recently saying that converting arable land to biofuel production is a "crime against humanity" and calling for a moratorium on biofuels until the next generation of cellulosic biofuels - from wood, straw, non-food fibers and waste - are ready for prime time.

Perhaps to forestall criticism, Sweden's Moderate-led government coalition is proposing a green biofuel identification system be launched within the European Union. A green biofuels identification system would be, the governement implid, a way for consumers at the pump to verify the 'bio' in their biofuel. An EU committee is already working on environmental criteria for biofuels and the green marking or certification system would be part of the EU directive on fuel quality. The idea is to put in place rules to enforce reduced CO2 emissions both from fuel's production and its use

by April Streeter, Gothenburg, Sweden

 

Biofuel plan still alive

ESCANABA — The next step is being taken in a joint biofuel venture between NewPage and a Swedish company.

NewPage’s possible partnership with ChemRec AB, which operates a biofuel plant in Pitea, Sweden, was announced last year. The two are exploring the feasibility of starting a biofuel plant at NewPage’s Wells Township mill.

“A few employees of NewPage traveled to Sweden to view the technology and determined that working with ChemRec would be a good fit for both companies,” said Kel Smyth, government and community affairs manager at NewPage.

The first phase, a pre-feasibility study, of a three-phase plan has been completed.

“An agreement was reached on April 18 to move forward to Phase ll of the plan, with Phase ll being (another) feasibility study. The study, which will take approximately seven months to complete, will cost an estimated $1.4 million. We are currently working out the cost-sharing details for the study, which will also include a primary engineering study,” Smyth said Tuesday.

Byproducts of paper production at NewPage would be used to make biofuel.

“NewPage operates a kraft/pulp mill, where fiber is removed from wood chips, with the fiber being used for the production of paper products,” said Smyth.

Smyth said “black liquor” is produced during the process of extracting fiber from the wood chips. The black liquor byproduct would be the key component of biofuel.

“Currently, NewPage burns this black liquor in a boiler which produces energy used in the production of paper,” said Smyth.

In Sweden, ChemRec AB takes this stream of black liquor and has established a means of converting the stream into gas. A number of different fuels can then be produced, Smyth said.

“Two of the biofuels being produced using this method are methanol and dimethlyether, which can be used as a gasoline additive. The methanol produced could be used in other industrial processes,” said Smyth. Other fuels being produced through this method are biodiesel, hydrogen gas, and synthetic diesel.

Investment in biofuel is irresponsible – UN Adviser

The biofuel debate has now got to a head, the UN has joined in the fray.

The UN’s top adviser on food security has described investments being made into biofuels by some countries as “irresponsible” and a “crime against humanity.”

Olivier de Schutter, who has recently taken over from Jean Ziegler, said these in an interview with the BBC.

Mr. de Schutter is also calling for an immediate freeze of the policy and asking for restrain on investors whose speculation he says is driving food prices higher.

Global food prices have triggered violent reactions in some parts of the world, particularly in some developing countries.

It is estimated that 100 million poor people of the world are likely to be pushed deeper into poverty if nothing is done immediately to save the situation.

And frantic efforts are being made by world organizations including the UN, World Bank and the US government to cushion the effects of the high cost of food on the poor.

The George Bush administration about two days ago asked Congress for an additional $770 million for food aid for the rest of the world.

In the thick of the biofuel wranglings is South American giant, Brazil. Brazil is leading the countries pushing for growing crops for biofuels.

The country has signed an agreement with Ghana to grow sugarcane in the country to produce bio-ethanol for export.

The 27,000 hectares of sugarcane project is for the production of 150 million litres of ethanol yearly for export to Sweden.

But de Schutter says the use of food crops for alternative sources of energy like ethanol is one of the factors behind the price hike.

He argues that, the biofuel rush was a "scandal that only serves the interests of a tiny lobby".

He criticized United States and the European Union goals for biofuel production calling it unrealistic.

Mr. de Schutter says he wanted to find ways to limit the impact of speculative investments in food commodities like wheat, which had further driven prices up.

Mr. Olivier de Schutter, who is a Belgian professor of law is calling for a special session of the UN Human Rights Council to discuss the food crisis.

He said, "nothing was done to prevent speculation in raw materials, though it was predictable investors would turn to these markets following the stock market slowdown. And we are paying for 20 years of mistakes."


By Emmanuel K. Dogbevi

Biodiesel not always profitable

Biodiesel not always profitable

By Kyle Stock

The wonder-fuel called biodiesel is no longer cheap

The demand for environmentally friendly fuel and the oils that are used to make it has surged in step with the cost of crude oil and conventional gas. Much of the biodiesel now produced in South Carolina — championed for reducing U.S. reliance on foreign oil — is now shipped to Europe, where stronger currencies have more buying power and suppliers are willing to meet higher prices.

Southeast BioDiesel LLC has been cranking out the fuel for almost a year now on the old Navy base in North Charleston, chemically treating chicken fat until it can power a Mercedes. Though the factory is pumping out 18,000 gallons of biodiesel every day — 360,000 gallons a month — the plant is surviving on tiny profit margins, according to cofounder Dean Schmelter.

"The chicken guys have figured out the exact point where we stop making a profit and that's where they keep it," Schmelter said. "We're not making money, but we're not losing it either."

Every week about 1,000 gallons of Schmelter's fuel is poured into cars just down the road at the Fox Music store, where OM Fuels LLC has set up the only retail biodiesel pump in the area. The cost last week: $4.12 per gallon, roughly the same as a gallon of conventional diesel.

OM Fuels said it isn't making money on biodiesel either. Chief Executive Charles Robert Adams said the green fuel is now tightly tied to commodities markets, where restless traders push prices through volatile swings and surges.

"It's just gambling," Adams said. "They don't add one iota of value to the product going to the public."

The so-called silver bullets of the biodiesel industry — fast growing fuel sources like algae and rapeseed plants — are still at least a few years from being grown and harvested en masse.

'Food prices may drop 20 pc if biofuel production stopped'

NEW DELHI: Global food prices could ease by up to 20 per cent by 2010 if biofuel production is stopped completely across the world, a US-based think-tank has said in its latest report.

"If biofuel demand from food crops was abolished after 2007, prices of key food crops would drop more significantly. By 2010, maize prices are expected to fall by 20 per cent, wheat by 8 per cent and sugar by 12 per cent," International Food Policy Research Institute (IFPRI) report said.

However, it maintained that the contribution of biofuel production in wheat and rice price rise is only 22 per cent, while factors like bad weather in key producing nations like Australia, higher oil prices and poor government policies had much bigger impact.

It also said, "If biofuel production was frozen at 2007 levels for all countries and for all crops used as feedstock, maize prices are projected to decline by 6 per cent by 2010 and 14 per cent by 2015."

The demand for biofuel has increased prices of wheat by 22 per cent and rice by 21 per cent during 2000-07 period, while the overall impact on all grain prices is estimated to be about 30 per cent, the report 'Biofuels and grain prices: impacts and policy responses' revealed.

However, the biggest impact was seen on maize, which rose by 21 per cent due to increased biofuel demand, IFPRI said, adding that the role of biofuel policies in the food-price hikes has become particularly controversial.