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Biofuels

There is a challenge facing the world, and it is to seal the deal on combating climate change at the UN conference on climate change meeting in Copenhagen in December. In its last report, the intergovernmental panel on climate change considered that the 2° C rise in temperature that marks dangerous climate change would be triggered by a CO2 emissions concentration level of 450 parts per million. Many of us now believe that figure to be hopelessly optimistic, and consider that a concentration level of 380 ppm, or even 350 ppm, to be more in keeping with the latest science. However, for the purpose of this debate, I shall use the 450 ppm figure. To stay within the target of 450 ppm, the world must curb its projected greenhouse gas emissions by 17 gigatonnes per annum by 2020. However, by 2050, the total emissions each year from the entire global population must be no more than 20 gigatonnes if we are to stabilise the climate within the 2° C dangerous climate margin. That is a huge mitigation challenge—a reduction of at least 47 gigatonnes from a business-as-usual scenario. Globally, biofuels and biomass could play an important role in meeting those mitigation targets. Nationally, the UK renewable energy strategy, published earlier this year, has indicated that approximately 30 per cent. of the UK's renewable energy target could come from bioenergy for heat and power. That could rise to 50 per cent. if biofuel for transport is included. The target is for 15 per cent. of our energy to come from renewables by 2020, which means that in the next decade we should see the UK growing 4.5 per cent. of its heat and power. In 2006, Peter Kendall, the president of the National Farmers Union, argued that British farmers were uniquely well placed to deliver the renewable transport fuel obligation in a sustainable manner, thanks to the widespread adoption of farm assurance schemes. He said:""Developed in a sustainable way, in the context of a wide-ranging strategy for alternative crops, biofuels offer society a win, win, solution."" Part of the win for farmers is the £47 million subsidy that the Government provide through the rural development programme, under which payments of 40 per cent. of the actual establishment costs of energy crops are made to encourage farmers to plant for energy. However, this is where farmers need to gauge relative reward: certainly, the high price of wheat, even from lower yields on poor-quality land, has not encouraged them to switch from traditional food crops as fast as the Government would have wished. That has prompted the Government to decide to increase the planting grants from 40 per cent. to 50 per cent. of actual establishment costs in England from 2010. But subsidy is a two-edged sword. It should be used to tackle market failure; it should not be used as market manipulation for the protection of domestic interests. Last year's report from the World Bank entitled "Biofuels: The Promise and the Risks" highlighted the effects of the support for biofuels among different Governments around the world. It stated:""Governments provide substantial support to biofuels so that they can compete with gasoline and conventional diesel. Such support includes consumption incentives (fuel tax reductions); production incentives (tax incentives, loan guarantees, and direct subsidy payments); and mandatory consumption requirements."" The report said that more than 200 support measures costing around $5.5 billion to $7.3 billion a year in the United States amount to 38 to 49 cents per litre of petroleum equivalent for ethanol. It added:""Even in Brazil, sustained government support through direct subsidies was required until recently to develop a competitive industry. Domestic producers in the European Union and the United States receive additional support through high import tariffs on ethanol.""Biofuel production has pushed up feedstock prices. The clearest example is maize, whose price rose by over 60 percent. from 2005 to 2007, largely because of the US ethanol program combined with reduced stocks in major exporting countries."" Subsidy drives land use change, and the effects of that can be considerably more than tortilla riots in Mexico—as we have seen—and food price spikes on the world market. Land use change that replaces biodiversity with monoculture can do incalculable damage to the ecosystem, and is capable of turbo-charging climate change, ultimately resulting in greater greenhouse gas emissions rather than lesser. Malaysia and Indonesia have seen a staggering loss of forest cover replaced by oil palm trees. Such monoculture plantations drive the loss of tropical forest biodiversity, which is not simply a problem for the orang-utans, around which such a notable campaign has been organised recently; it is a problem for the planet, as the planet loses all the ecosystem services that the forest provides, including carbon sequestration, climate regulation, soil stabilisation and watershed protection, as well as the habitat and provisioning services. When those are factored in, the price of biofuel may appear very high indeed. The grain required to fill the tank of a Range Rover with ethanol is sufficient to feed one person in the developing world for an entire year. American ethanol from maize uses fossil fuel at every stage of its production process—from fertiliser production to tractor harvest, to processing and transportation to destination. It has been calculated that the growing of maize for ethanol uses 30 per cent. more energy than the finished fuel produces. It also leaves eroded soil and polluted waters in its wake. Globally, the land cover under biofuel crops is projected to grow by 240 per cent. between 2005 and 2030. That has to be set against the rising demand for food crops as the planet's population rises from 6 billion towards 9.7 billion by 2050. That is not just 50 per cent. more mouths to feed, but 50 per cent. more carbon footprints at a time when rising living standards for developing countries are seeing rising demand for less-efficient meat over cereals. The Gallagher report, which the Government commissioned, confidently predicts that sufficient appropriate land will be available to meet both biofuel and agricultural food needs through to 2020. However, very openly, very honestly, the report also states that it has made no estimate of the likely conflicts over land use that may arise after that. I suggest to the Minister that this is an important piece of research that must be commissioned urgently. We must ensure that credible, robust and widely accepted sustainability standards are put in place so that biofuel production does not lead to a net carbon debt and so that land of high agricultural, food and biodiversity value does not experience conversion to biofuel production. Only if such standards are established can biofuels and biomass play an important and positive role in the mitigation of greenhouse gas emissions and in avoiding dangerous climate change. In the remainder of my speech, I shall set out key policy proposals and trust that in his reply my very good friend, the Minister—