The Big Biofuels Blog

Argentinian companies are progressing with a process to produce biofuels from seaweed, according to ICIS news.

Argentina’s Oil Fox and Biocombustibles de Chubut have teamed up to produce and export biodiesel from seaweed, according to president Jorge Kaloustian of Oil Fox.
He added.
An undisclosed Swiss partner will bankroll the project with a $60m (€44m) investment, Kaloustian said in an interview.

"Is going to be the first biofuel of this type in the world", Kaloustian said.

Seaweed will be worth watching. Japanese researchers have been looking at the process.

A whole raft of United Nations statistical data became available free on 1 May 2007. Enjoy yourselves.

ChemSytems, a petrochemical consultancy has published a biogasoline report.

What are biofuels doing to UK farming? If you are interested in this question then there's a paper in Environ. Sci. Tech a learned journal which is available by subscription.

Here's the abstract though

The United States and the European Union have set targets for biofuel production to decrease reliance on fossil fuels and to reduce fossil carbon emissions. Attainment of biofuel targets depends upon policy and infrastructure development but also on production of suitable raw materials. Production of relevant crops relies on the decisions that farmers make in their economic and political environment. We need to identify any farmer-related barriers to biofuel production and to determine whether novel policy and technology are required to meet targets. These aspects of the emerging biofuel industry are relevant across international barriers and have not yet been addressed quantitatively. We describe a case study from the UK of farmers' intentions toward producing two biofuel crops for which refining capacity either exists or is under construction. Given farmers' intentions, current land use, and conversion efficiency, we estimate potential biofuel production. These estimates indicate that EU targets are not achievable using domestically grown raw materials without policy intervention, use of alternative feedstocks, and either significant improvements in processing efficiency or large-scale changes in land use.

The authors are Elizabeth H. A. Mattison* and Ken Norris

Centre for Agri-Environmental Research, School of Agriculture, Policy and Development, University of Reading, Earley Gate, P.O. Box 237, Reading, RG6 6AR, United Kingdom

Good to see that academics are reaching the same conclusions as most of the rest of us, but with greater rigour

LS9 is putting the bio into biogasoline by using modified bacteria to directly produce hydrocarbons instead of ethanol or other intermediates, according to the BioConversion Blog, quoting Technology Review. LS9 has a number of big backers and is part funded by Vindod Khosla , the firm plans to build a trial plant in California to test the process.
I like the comment by Jim McMillan, principal biochemical engineer in the National Renewable Energy Laboratory's Bioenergy Center, based in Golden, CO he spoke to Technology Review and said: .

"I don't doubt that [making hydrocarbon fuel from microbes] can be done; the question is how quickly and at what cost."

Sweden's Minister for Foreign Trade, Sten Tolgfors recently used the,Taipei Times (where else) to call for the global trade in biofuels to be tariff-free.

Sweden's starting point is the conviction that a more liberal trade regime, coupled with global standards, is needed. As a first measure, Sweden argues for the elimination of all tariffs on ethanol.

Apart from environmental considerations, there are other important benefits of expanding world trade in biofuels. Generally, international trade is a strong instrument for development. Several developing nations have a comparative advantage in producing ethanol -- and other biofuels, for that matter. Brazil, which is now the world's largest producer and exporter of ethanol, is a case in point.

But there are other developing countries that are exporters of biofuels, and still others that view it as an important source of future income. Trade policy should support, not undermine, these countries' ambitions.

Is there anyone from the heartlands reading this and agreeing with Tolgfors? Because that is the group that needs to be convinced that protectionism is a bad idea, not US drivers.

ICIS will be holding its own biofuels conference in conjunction with Kline consulting in St Louis, Missouri, on 14-15 November. They seem to have an interesting speaker panel.

(Disclosure: I work for ICIS: About ICIS)

I might be there myself...

The price of the US' sweet addiction to sugar farmers and the potential for further distorting the market for ethanol in the US is explored in a post over on the Politics of Food. Rachel C. Dechenne says in a post about the 2008 sugar program:

In June of this year, SUA and an alliance of 30 manufacturers including American Beverage Association, Kraft, Kellogg and ConAgra, Cadbury Schweppes, Coca Cola, General Mills, PepsiCo, GMA, Consumer Federation of America, Sweetener Users Association and US Chamber of Commerce, claimed that by imposing government-regulated price floors, marketing quotas and import restrictions, domestic sugar prices are increased.

The group also warned that a proposal to divert surplus sugar to ethanol production would force the government to buy even more sugar from American producers and then sell it at a loss to ethanol plants, with taxpayers picking up the difference.

Conoco-Phillips is helping fund University research into converting coal into ethanol, according to two posts conveniently pulled together on Doug Williams' blog No 1203: Biofuels, ethanol, biodiesel, clean energy.

Green car Congress talks about DOE and Conoco-Phillips Funding Research on Conversion of Coal-Derived Syngas to Ethanol

Lousiana Sate University, will be carrying out the work to improve the efficiency of ethanol fuel.

There is an awful lot of coal under the US, and if you're more concerned with fuel security rather than the energetic cost of producing fuel then it may be a good place to start looking. It is interesting that they are looking to make ethanol from syngas, when with a bit of fiddling you could make hydrocarbons... ConocoPhilllips has the infrastructure in place to handle those.

A study in the comparative economics of first and second generation biofuels has been published in Biofuels Bioproducts and Biorefining, a Society of Chemical Industry journal.
The key finding in the paper from Mark Wright and Robert Brown, of the Center for Sustainable Environmental Technologies at Iowa State University. Is that:

The cost of advanced biofuels, however, will be similar to that of grain ethanol as corn prices exceed $3/bushel

At the time of writing, the price of corn in Chicago, forward to the end of the year is above $3/bushel.

There's plenty of scope to discuss the models which have been used in this report. For example, the basis of financing. The authors are assuming an interest rate of 8%/year for 20 years, an interest rate that the Fed has not charged other banks since July 13 1989. Rates have gone up 3.75% since 10 August 2004, but you'd have to be a pretty small fish to pay 8% with the current Fed rate at 5.25%.

Aside from my bleating

The price of dry distillers' grains holds the key to economic corn ethanol production

Grain ethanol has a the highest biomass costs amongst the five technologies evaluated. This reflects a combination of relatively low fuel efficiency (about one third of the corn grain ends up as the by product distiller's dried grains) and high fuel cost (corn grain at $2.12/bushel is almost 75% more than lignocellulose on a dry weight basis). However... dried distillers' grains yield a production credit almost three times greater than that achieved by any of the other processes. if the the expanding grain ethanol industry produces an over supply of distillers grains (assumed to be $99/tonne in the present study) the attractive production cost of ethanol could evaporate.

So, corn is more expensive to buy, and if the price of dried distillers grains drops significantly, then ethanol's advantage would evaporate. In plants producing 150million gallons gasoline/year the dried distillers grains account for a 50cent/gal credit. It will be interesting to see where the equilibrium price of distillers grains settles when we have a combination of grain and cellulosic ethanol plants.

Now biofuels are putting bears under threat. The good/bad news is that its Germany's Gummi Bears, which are much less profitable for Harribo than they were because the price of glucose has risen, because its a sugar, which could be fermented... into alcohol which could be put into the European gasoline pool displacing gasoline which could be exported to the US.

The United Nations Food and Agriculture Organisation is pushing for a high level meeting next June to lay down rules for the international bioenergy market, which is currently regulated by domestic policies, according to the Financial Times. The FAO wants the European Union and the US to lower trade barriers to ethanol imports, establish a system for bioenergy environmental standards and give more micro credit to farmers in the developing world to help them jump on the biofuels bandwagon.

You need a subscription to the FT to read the whole thing, but Jacques Diouf, FAO Director general, says that these tariffs make it uneconomic for developing countries, with better climates and crops to use as biofuels, to sell those biofuels to the developed world. Removing or reducing those barriers could make a significant difference to the world's agricultural poor.

He adds:

But as things now stand, the Inter­national Energy Agency (IEA) projects that in 2030, biofuels will provide between 4 per cent and 7 per cent of all fuels used for transport, with the US, the European Union and Brazil remaining the leading producers and consumers. If that proves correct, it will mean that we had a chance to honour all our solemn pledges to banish hunger and poverty but chose to look the other way.

Write me a comment and tell me if you think he is right.

Small scale Jatropha cultivation over on Advantures in Sustainability. The wonder plant is cold resistant.

Farmland prices are rising because of biofuels, according to the New York Times.

DEKALB, Ill. — While much of the nation worries about a slumping real estate market, people in Midwestern farm country are experiencing exactly the opposite. Take, for instance, the farm here — nearly 80 acres of corn and soybeans off a gravel road in a universe of corn and soybeans — that sold for $10,000 an acre at auction this spring, a price that astonished even the auctioneer.

Gristmill has a couple of interesting blogs on a recent pronouncement from JK Galbraith, who's been peering over his glasses at a number of conundrums including whether markets can solve global warming.

Canada is pushing a four part plan called EcoENERGY for Biofuels and will see the government investing C$1.5bn ($1.4) over nine years to boost biofuels production in the country.

These are the key points
* Applicable to eligible production between April 1, 2008 and March 31, 2017.
* Available to eligible facilities constructed before March 31, 2011, subject to program volume limits.
* Incentives for up to seven years per eligible facility.
* Program volume limits of 2 billion litres of renewable alternatives to gasoline and 500 million litres of renewable alternatives to diesel, potentially increasing over time, subject to funding availability.
* Incentive rates of up to $0.10 per litre for renewable alternatives to gasoline and up to $0.20 per litre for renewable alternatives to diesel for the first three years of the program, declining over the following 6 years.

According to a government press release

Close to three billion litres of renewable fuels will be needed annually to meet the requirements of the new regulations. Canadian production in 2006 was only about 400 million litres, so the expansion will represent a tremendous economic opportunity for the country’s 61,000 grain and oilseeds producers.

“Good for the environment and good for farmers, our government’s investment in biofuels is a double win,” said Prime Minister Stephen Harper

Lets hope so

Lord Ron Oxborough, who I met briefly at the House of Parliament the other day, was in Australia on Tuesday talking about biofuels. You can listen to Ron Oxborough (from 13 minutes into the broadcast) from ABC.
He gets to answer questions about food, sustainability and a number of other topics. How the firm's plantations are helping poor people in the developing world to find work and Jatropha Caucus as a plantation crop, similar to olive production and using garbage as a feedstock for biofuels.

Sand willows are slowing the Gobi Desert's spread in Mongolia, according to Greening The Desert blog. The trees will be used to generate electricity at power plants in the region

According to Greening the Desert

In early 2007, the first desert biomass thermal power plant was constructed near to an existing methanol chemical plant, two kilometres away. The power plant uses the waste water from the methanol plant, and the biomass residue can be further processed into potassium fertilizer. The power plant is slated to begin operation early next year and will generate some 180–210 million kWh of electricity annually.

It will be interesting to see if the willows are sustainable, whether they can extract enough water to grow for several cycles of harvesting and whether they can help to stabilise the soil in the longer term.

JM Panton's tanks are now green, I notice over on Can I make some BioDiesel?

Eastman has moved to B20 for in house locomotives at its Kingsport, Tennessee plant, according to the Brotherhood of Locomotive Engineers and Trainmen.

Increasing production of biofuels to combat climate change will release between two and nine times more carbon gases over the next 30 years than fossil fuels, according to the first comprehensive analysis of emissions from biofuels in today's Guardian Unlimited.

The original work is in Nature, so its hard to read unless you subcribe. But the reserchers make the point that clearing forests for biofuel production dramatically increases the amount of carbon in trees and soil which is available to the atmosphere.

The article concludes with

The researchers say the emphasis should be placed on increasing the efficiency of fossil fuel use and moving to carbon-free alternatives such as renewable energy.

Argue with that and stay fashionable.

Canada's Shane and Evan Chrapko who made a packet in dot.coms and got out while the getting was good, have followed Vindod Kohlsa another web entrepeneur into biofuels, using a surprisingly similar approach.
According to Blognation's the two are bankrolling a technology to digest farm waste an turn it into methane, fertiliser and clean water

Hattip to Adders

Here are some recent blog posts about Jatropha.
SandeepOzard's blogpage a pretty thorough round up on the plant, by the looks of things
Clement Nyirenda's Blog World an interesting look at things from an african perspective
The Energy Blog pretty solid stuff from the Fraserdomain
Jatropha: The Next Biofuel Craze
Biopact
href="http://greenoptions.com/2007/03/29/jatropha_the_alternative_plant_for_renewable_energy">Greenoptions
Energy and Electric Power news
WSJ online Blogs
Fuel for thought
Tree Hugger

So from this list I'd say that if you're interested in Jatropha, and judging by Technorati, its a pretty small blogging field then the people you should be reading (apart from the Big Biofuels Blog, of course) are Biopact, Wired and the Fraserdomain.

Researchers in the US have decided it is high time that they understood what makes up the nation's indigenous but largely undomesticated coniferous forests, according to ScienceDaily.

Jeffrey Dean, professor of forest biotechnology in the University of Georgia Warnell School of Forestry and Natural Resources, is spearheading a project at the U.S. Department of Energy’s Joint Genome Institute (JGI) that will greatly expand the gene catalog for pines and initiate the first gene discovery efforts in five other conifer families.

“The wood from conifers will almost certainly be an important component of this nation’s biomass energy strategy,” Dean said, “but despite extensive commercial plantations they remain essentially an undomesticated species. Information from this project will greatly enhance the ability of our tree improvement programs to develop pines tailored to suit the needs of the future bioenergy industry.”

This may be a good thing for biofuels in the future, and also for environmental lobbyists who will be rightly concerned about the potential for a loss of biodiversity and the potential for an Uberpine to be bred for biofuel plantations.

Crown Prince Willem-Alexander (of the Netherlands) has warned, during the World Water Week in Stockholm, about using large quantities of water to produce biofuels, because there may be too little water left over to cultivate crops for the growing world population, according to SenterNovem.
You can see a report on the meeting from AP here.

Hear hear, your Majesty, hear hear

The threat to world water supplies posed by biofuels has come to the surface following a water conference in Copenhagen earlier this week. It is worth reading Adam Cox's feature on Planet Ark for an interesting analysis of some of the issues raised.
In addition to Prince Willem-Alexander's comments, Cox says

This can mean using up water as well as land -- a reminder that biofuel crops themselves can carry severe risks for the environment, especially if hitherto unfarmed land is converted to agriculture with large amounts of fertiliser and irrigation.

The International Water Management Institute, which led a five-year global study on water involving more than 700 researchers, found that if China and India pursued their current biofuel plans, they faced water scarcity by 2

It will be interesting to see if this pressure grows sufficiently to slow or stop biofuel production.

Here is a view on why biofuels could actually be bad for the planet from a person at the Heathrow Climate camp.

Do you think she's right, please let me know.

There's more on water and biofuels producion, strictly ethanol on watercrunch. It concentrates on the amount of water used to process the grain once it has grown, rather than on the amount of water needed to grow it in the first place but the numbers are worth looking at.

Indonesia's Medco to invest in cassava-based Ethanol in at least one of three factories it is expecting to build in the country for between $135-144m, according to the Investor daily, quoted by Planet Ark.

Medco plans to export the ethanol to India, according to the report.

Indonesia plans to plant more than 5 million hectares with palm oil, jatropha, sugar cane and cassava by 2010 as biofuel feedstock, according to Planet Ark, but it is not clear how much of this will be replaning of existing plantations, and how much will be cleared forest.

Biofuels may help poor farmers, according to a book out today "Biofuels for Transport: Global Potential and Implications for Energy and Agriculture," authored by the Worldwatch Institute and published by Earthscan.

The authors say:

In addition, growth in biofuels production may have unexpected economic benefits, according to the experts who contributed to the report. Of the 47 poorest countries, 38 are net importers of oil and 25 import all of their oil; for these nations, the tripling in oil prices has been an economic disaster. But nations that develop domestic biofuels industries will be able to purchase fuel from their own farmers rather than spending scarce foreign exchange on imported oil.

As far as I can see it might be possible for a large poor country to grow non-food crops to convert into biofuels, somewhere the size of Congo, say. But that is pretty theoretical and would rely on only a relatively small motorised population, and enough excess to feed the people. Biofuels may be able to go some way to helping reduce dependence on oil for these people.

Also the report has some numbers on biofuel production.

World biofuels production rose 28%to 44 billion liters in 2006, according to the figures compiled since research on Biofuels for Transport was completed; fuel ethanol was up 22% and biodiesel rose 80%. Although biofuels comprise less than 1% of the global liquid fuel supply, the surge in production of biofuels in 2006 met 17%of the increase in supply of all liquid fuels worldwide last year.(My emphasis)

The 1% number puts the arguments that biofuels could help make the world independent of oil pretty firmly in their place.
If biofuels account for that level currently, what will be the price of corn when it reaches 2% or even 5%? That is good news for farmers, and there is a danger that some of the increased revenue they generate will trickle down to farm labourers and others who work on the land, but will that be enough to buy goods, products and services that city dwellers need to be able to sell to survive?

Four US biofuel projects get $97m in loans from the US Department of Agriculture, according to Green car Congress.
The firms are
* Clean Burn Fuels LLC, in Hoke, County, N.C., is approved to receive $10 million from the Section 9006 program and a $25 million B&I loan guarantee to construct a new ethanol plant that is expected to produce 60 million gallons of ethanol per year.
* Blackhawk Biofuels LLC, Freeport, Ill., is approved for a $7.5 million Section 9006 loan and a $20 million B&I loan to build and operate a 30-million-gallon biodiesel facility.
* National Trail Biodiesel, Newton, Ill., also approved to receive a $10 million Section 9006 loan and a $5 million B&I loan to build and operate a 30-million-gallon-per-year biodiesel production facility in Jasper County, Ill.
* Appling County Pellets, Savannah, Ga., is approved to receive a $10 million Section 9006 loan and a $9.5 million B&I loan to produce up to 130,000 metric tons of wood pellets to be sold in domestic and international markets.

Could biofuels help win the "war on drugs"? The question popped into my mind after reading about the sight of poppies which greeted a British Soldier in Afghanistan. The original story, by Misha Glenny, a former BBC journalist, appeared in the Washington Post: Hattip to the Crimes and Corruptions of the New World Order News blog. That's where you'll have to go if you want to read it. (The article is hidden behind a subscription wall on the Post)
From Glenny's article:

Poppies were the first thing that British army Capt. Leo Docherty noticed when he arrived in Afghanistan's turbulent Helmand province in April 2006. "They were growing right outside the gate of our Forward Operating Base," he told me. Within two weeks of his deployment to the remote town of Sangin, he realized that "poppy is the economic mainstay and everyone is involved right up to the higher echelons of the local government."

One of the big attractions of opium is that

Japan's government is encouraging people to dispose of their disposable chopsticks carefully, sot that they can be collected and used as biofuel, according to Tree Hugger.com. which says.

Japan's Ministry of Agriculture, Forestry and Fisheries is looking to introduce recycling bins to begin collection the country’s hearty supply of disposable chopsticks. It appears, that on average, each of that nations 127 million souls discards 200 sets annually.

Whatever happened to wipe-clean hardwood chopsticks that were handed down from father to son, mother to daughter for generations? Would the Japanese government be better popularising socks so that people had some where to stash their reusable chopsticks when they're not in use?

There are more proposals to be debated as the US Farm Bill 2007 gets closer to enactment, according to 25x25, a US pro-biofuel pressure group.
The US house of representative has agreed a proposal, which is different from proposals from Senator Jim Harkin in the Senate.
The house's agreed position looks like this, acording to 25x25
House Farm Bill Energy Title Addresses 25x?25 Goals
Meanwhile, the House farm bill?s energy title addresses many of the goals listed in The 25x?25 Action Plan: Charting America?s Energy Future, a set of 35 policy recommendations developed by the 25x?25 National Steering Committee in February to help insure a renewable energy future. The Action Plan calls for annual spending under the farm bill energy title to increase by $1 billion, including $250 million for the Section 9006 program.

The House bill increases the loan guarantee level in the 9006 program from $10 million level to $25 million, and provides $115 million over five years for the program. The House bill also provides up to $2 billion for loan guarantees of up to ninety percent of loans used to help pay for development, construction and retrofitting of biorefineries and biofuel production plants to demonstrate the commercial viability of converting biomass to fuels or chemicals. The House measure reauthorizes Section 9008 biomass research and development programs as recommended in the Action Plan, but provides no new money. The Action Plan would increase to $300 million the annual authorization for Section 9010, which reimburses ethanol and biodiesel producers for the purchase of commodities to expand existing production. While the House bill would authorize no new money, it does add the cost of cellulolic feedstocks as eligible for reimbursement under 9010.

In addition the House bill authorizes the Secretary of Agriculture to work with other Federal agencies and universities to conduct a competitive research and development program (including grants, and cooperative agreements) to encourage new forest to energy technologies. It alsoestablishes a biomass energy reserve (BER) and provides financial and technical assistance to landowners and operators to produce energy crops and harvest, store, and transport cellulosic material.

The House bill reauthorizes the Sun Grant Initiative, which provides money for research of, among other things, the development of regional-scale agronomic production systems for energy feedstocks.

Another 25x?25 Action Plan recommendation incorporated into the House farm bill energy title includes a provision directing the secretaries of Agriculture and Energy to conduct a study of comprehensive infrastructure needs for the renewable fuels sector, including ethanol and pipeline needs and feasibility, and recommend needed action to ensure delivery of renewable fuels and feedstocks to the market. The House bill authorizes $1 million for the study.

There are a number of letters about biofuels in Today's Guardian Online edition.
They are broadly positive, with one exception calling for a moratorium on biofuel production so that the impact on the developing world can be assessed. Doubtless this is theoretically a good idea, but as we are dealing with sovereign states, perhaps a better approach would be to apply pressure via the UN and WTO to countries that are not producing bioufels to good environmental standards.

Another reason to go to the movies, if you're in the US/Canada popped into my email box from Earth Policy News, Leonardo DiCaprio and a host of real celebs like Stephen Hawkin, and Mikhail Gorbachev talk about global warming and what we can do to stop it/slow it down. Doubtless there are mentions of biofuels.

If you see it let me know how good it is in a comment please. It's not been released here yet.

Ethanol is not always a good idea, in countries like Barbados. That is the story the Barbados Free Press has on-line, about the visit of some European Union advisors to the country, who were sent to look into the suitability of converting the Barbadian sugar industry into ethanol production.
Worth reading not only for the tooing and froing that the report says went on between the government and the EU adivsors (who left pretty sharply) but also for the paper's take on the government's response to the EU's initial proposal for an audit of a one-off payment to help cushion changes in the sugar regime.

If developing countries are going to grow their biofuels industries, they will need to be able to convince donors that the money will be going to the right place. Donors have a duty to the people who fund them, that this is happening. Audits with aid would help ensure transparency and confidence between donor and recipient.

Hats off (and a deep bow) to Keith Ripley on the Temas Blog, who's post on his excellent blog, pointed me in this direction.

BP and the German biofuel group Verband der Deutschen Biokraftstoffindustrie (VDB) have fallen out over the level of blending and the type of biodisel to be blended in Germany, according to a report on ICIS news

(Disclosure: I work for ICIS. About ICIS)

BP says the level is too high --and that car engine makers agree -- and pointed out the impact that first generation biofuels are having on food supplies. (Separately I notice the BBC has a story about rising wheat prices being passed through to customers of Cornish Pasties ).
Instead BP, which has interests in Jatropha, says that hydro treated oils should be used instead.

The VDB's reaction is pretty predictable, saying there's enough capacity in Germany and anyway that the BP position would imply greater imports of palm oil and that could harm German biofuel makers.

Well excuse me. Shouldn't the consumer get the cheapest biofuel irrespective of the source, subject to ethical standards in production being met? Why should German consumers be forced to buy expensive uneconomic biofuel if it can be made elsewhere, shipped to Germany and sold at the pumps for less than locally produced biofuel? I think that the WTO should look at the subsisides, and trade barriers that exist between the rich north and the poor south in all forms of biofuels.

We will be undergoing routine maintenance this week end and you will be unable to post comments to this blog until Tuesday 28 August. Sorry for any inconvenience this will cause.

Biofuels and poorer harvests mean that UK meat prices are set to rise, according to reports on the BBC this morning. The BBC has missed a key point here, UK farmers will not be badly disadvantaged compared to farmers in other parts of the world.

The weather does not seem to have been particularly good for crops worldwide this year, and we are taking increasing volumes of food crops and turning them in to biofuels. This combination, will help to drive up food prices globally, over the coming years unless second generation fuels, which are based on cellulose come on stream, and unless there is a much more significant increase in fuel efficiency.
If things continue as they are, then by 2020 the European Union may see 18% of its total wheat and soft grains crops being diverted into biofuels, according to Planet Ark earlier this month.

Malaysia is delaying the implimentation of a law demanding that 5% of diesel fuel sold in the country is made of a rewnewable source because of the increasing cost of palm oil, according to a report on Thompson Financial.

The report says:

The current high price of biofuel raw material, namely refined, bleached and deodorised palm olein, has made it unwise to implement the Act now, Malaysia's Plantation Industries and Commodities Minister Peter Chin said.

"This has made the EnvoDiesel more expensive and unsuitable for commercial usage at the moment," Chin was quoted as saying.

If a country like Malaysia cannot afford to use palm oil in biodisel, how will European biofuel producers expect to make a profit on biodiesl based around palm oil, once the cost of shipping, processing and factory depreciation is added to the equation. We are going to see a lot of invention, interms of other feed stock sources in the coming months.

Also it will be interesting to see whether Japan delays the aid it offered Malaysia to help it to develop palm oil as a biofuel in mid August.

An Indian government energy advisor has warned that biofuels could pose problems for his country and would not be the best way to use land or water resources. Surya P Sethi was quoted by Ashok Sharma in the Financial Express, news paper.

The report says

Based on available data wood plantations provide the best use of such lands for commercially grown bio-energy as it would yield some 9 times the energy compared to bio-diesel from equivalent land mass.

The annual yields of bio-energy from wood plantations are estimated at a low of 5 tonne to a high of 20 tonne per hectare, he said.

According to Sethi, ethanol based on sugarcane or alternate crops could match wood but the crops would require intensive cultivation, water, fertilizer and arable lands.

And its the amount of water, fertiliser and land that is what would stop India taking the biofuel route. He seems to lean more towards solar power, but the article did not discuss the level of capital needed to fund the area of panels that would be needed.

For me looking at wood is interesting, it seems to grow well on poor soils and can yeild considerable environmental benefits if it is grown sensibly and harvested properly. The lead time is long though.

As it is India is well ahead of the developed world in terms of the share that renewables have in the energy mix.

According to Sethi about 31% of India’s primary energy needs are met from bio-energy produced on non-commercial basis from agricultural and forest waste, wood chips, animal waste and bio-fuels.

Hattip to my friends at the Biofuelwatch Yahoo Group.

This website can give you help in finding the right way to pay tax and duty on biofuel or straight veg oil used as fuel in the UK. It might save you a lot of trouble...

Wood processing waste is a biofuel source, accordding to the Energy blog which says

Adding a little coal and processing the papermaking industry's black liquor waste into synthesis gas is a better choice than burning it for heat, improves the carbon footprint of coal-to-liquid processes, and can produce a fuel versatile enough to run a cooking stove or a truck, according to a team of Penn state engineers.

That's got to be one of the better ideas for biofuels, taking a waste product and doing something useful with it, even if in volume terms it is limited, compared to oil.

Mozambique has outlined a big biofuel push into ethanol and biodiesl from jatropha. According to Planet Ark.

Eugenio Silva, a senior PETROMOC official, said it would create about 800 jobs and lead to a maximum annual production of 226 million litres of ethanol and bio-diesel seven years after start-up.

PETROMOC intendsto get funding for the project from international donors and investors, according to the report.

The company inaugurated biodiesel production in Matola, on 22 August.

I think that the Mozambique government should insist that donors and investors have the use aid is put to audited as part of their conditions of accepting it. That is not to say that anyone involved is or would be corrupt, but it would give the organisations that fund the donors confidence that the money would go to the right place.

EU opens distillation tender to convert unwanted wine into industrial ethanol, according to the Turkish Daily News.
The distillation will help take excessive wine off the market and support prices in Europe.
As I said in July, this is not a satisfactory state of affairs, why can't the market operate and to help people pay a fair price for wine. The EU will be looking at the structure of the wine market later this year, according to the daily news... Lets hope the EU devises a solution that will benefit both the farmers and the consumers.

USA Today had a nice piece on Georgia's aspirations as a biofuel state, last week, which I've just seen. It covers some of the incentives that there are in the US to produce biofuels and just how much drivers in South Carolina can get back from the taxman if they use E85 bioethanol blend.... Georgia's secret weapon? Forests.

According to Paul Hodges (aka the chief economist) over on Chemicals and the Econonmy, the spat brewing between OPEC (the oil producers' club) and the International Energy Agency (the rich countries energy watchdog) is coming along nicely.

According to Hodges,
Claude Mandil, director general of the IEA, told Arab Oil and Gas 'the market has become aware' that OPEC 'has set an implicit new objective of keeping prices at or around $70/bbl and that the organisation is trying to defend this level.'

If that's the case its got to be good news for biofuels. it will be interesting to see at what level oil would have to reach before biofuels become truely cost effective substitutes for part of global gasoline/diesel demand without subsidies.