To fulfill its environmental promises, biofuel policy needs a kick in the pants
As war simmers in the Middle East and oil prices rise along with global temperatures, Midwestern farmers and politicians aren’t the only ones banging the drums for biofuels. Now big-time investors, security hawks, environmentalists, and even George W. Bush have joined their ranks. But is environmentally responsible bioenergy a real possibility, or are we bio-fooling ourselves?
The question is key, because current U.S. public policy is pushing biofuel production without giving much evident thought to sustainability. If present trends continue, the public could find itself funding environmentally ruinous projects in the name of “green” energy. Here’s a strategy for avoiding that outcome.
Ready or Not, Here It Comes
Globally, biofuel production is booming. Since 2000, world fuel-ethanol production has more than doubled, and biodiesel production has expanded nearly fourfold, albeit from a much smaller base. In comparison, world oil production increased by only 7 percent in the same time period.
Recently adopted mandatory biofuel requirements in the United States and the European Union are increasing biofuels’ domestic production and creating markets for imports. The developing world is pursuing biofuel production to offset oil imports, drive rural development, and earn foreign exchange through exports.
To understand the impact of oil imports on the developing world, look at some of Africa’s poorest countries, where the recent increase in oil prices has all but wiped out their hard-won debt relief. Growing fuel at home rather than buying oil abroad means poor countries have more resources for development needs like health care and education.
With high oil prices and the perceived development opportunities, the incredible amount of political and financial momentum behind biofuels is not surprising. And as usual, environmental considerations, which don’t fit easily into a system measured solely in barrels and bucks, struggle to find relevance in a rapidly expanding industry.
But without asking the hard “environmental” questions — regarding greenhouse-gas reduction, soil conservation, biodiversity protection, etc. — there is no chance of developing sustainable bioenergy.
Putting the Biofueled Cart Before the Horse
Historically, environmental action has been reactive, responding to crises already well underway. Bioenergy presents a unique opportunity to proactively guide a growing industry into the most sustainable practices.
For example, the U.S. ethanol industry is experimenting with new plant designs in response to higher natural-gas prices, the fuel’s traditional power source. Some new plants are being built to burn coal, undermining claims of the environmental benefits of ethanol by creating more, not less, air pollution. But other innovators are figuring out how to reduce or replace their natural-gas needs in ways that improve the energy and greenhouse-gas balance of their ethanol product. Still others are designing their plants to utilize both corn starch and cellulose as feedstock. If biofuels are truly going to be part of a clean energy future, policy makers need to encourage these innovators and discourage regressive practices.
But from where I sit in Washington, D.C., the biofuels discussion is pretty simplistic: Either you’re for ’em or you’re against ’em. Although there are plenty in the biofuels camp who want to see new ways of growing crops and producing ethanol that further reduce greenhouse-gas emissions and protect water and land, so far the great bulk of biofuel subsidies have pushed brute production, environmental goals be damned.
In Europe, however, the question of sustainability dominates the bioenergy debate. The Netherlands has already established sustainability criteria for all biomass, whether domestic or imported, used for bioenergy. Their sustainability evaluation [PDF] includes greenhouse-gas balance, farming practices, biodiversity, and the economic and social well-being of the farming communities. Germany and other European countries are considering similar requirements.
The global dialogue on sustainable bioenergy is also beginning. The International Energy Agency has established a task force to help foster sustainable bioenergy trade, and representatives of eight European countries, Canada, and Brazil are participating in its activities. This past October in Bonn, the German NGO Forum and the U.N. Foundation sponsored a conference that brought together a wide range of government, industry, and NGO representatives from around the world to discuss the challenges and opportunities of sustainable bioenergy. The concern over destruction of tropical rainforests for palm oil plantations linked directly and indirectly to biodiesel demand has spurred the creation of the Roundtable on Sustainable Palm Oil, which is dedicated to developing a globally acceptable definition of sustainable palm oil and helping implement these practices.
The United States is not completely absent from the sustainability discussion and development of best practices. In response to a plan to increase electricity generation from wood waste, the Institute for Agriculture and Trade Policy and its partners facilitated the passage of a Minnesota statute requiring the development and implementation of best management practices for biomass harvesting forests and brush lands. To assess costs and environmental impacts, a variety of test harvests are now underway, which will provide crucial information on how to use biomass for energy in a sustainable way. Some parts of the industry are even tackling the issues: The Biotechnology Industry Organization recently released a report on sustainable production of biomass focused on crop residues that recommends, among other things, the development of a system to monetize greenhouse-gas credits for agricultural products and assistance for farmers to transition to no-till cropping and to better manage carbon in their soil.
The two themes that consistently emerge from discussions of biomass sustainability are certification and linkage to carbon emissions. While not miracle cures, environmental certification programs, like the USDA organic label for food and the Forest Stewardship Council label for wood, have changed agriculture and forestry management practices and consumers’ buying habits. Could such a program do the same for biofuels and other bio-products?
Possibly. Unlike food and wood, there is no real visible market for biofuels right now. In the United States, E85 (a blend of 85 percent ethanol and 15 percent gasoline) is still difficult to find outside of the Midwest. While small percentages of biofuels are increasingly blended with petroleum fuels sold across the nation, would an environmentally friendly seal for the 10 percent of the fuel that is ethanol make any sense on an ExxonMobil gas pump?
Certification does make sense as a way to enforce government standards, as in the Netherlands and Minnesota laws, or as the basis for government incentives. As the biofuel market matures and diversifies, individual consumers could support sustainable practices with their dollars.
But what will really empower a biomass certification scheme and drive bioenergy toward sustainability in the United States is integrating carbon emissions into the system. Although the recent elections have brought us closer to a national carbon cap-and-trade scheme than ever before, such a system is not imminent. In the meantime, Congress should make any new biofuel incentives performance-based, so that a farmer’s success in improving her carbon balance is reflected in her bank balance.
It is time to get serious about a clean and sustainable energy future. The reauthorization of the Farm Bill next year offers an opportunity to promote biofuels in a way that maximizes environmental protection while creating new sources of revenue for farmers. To prevent biofuels from being an environmental bio-flop, we must confront their sustainability issues immediately.