Third Biofuels Report to Congress

Project ID

2779

Category

Other

Added on

Nov. 21, 2018, 10:12 a.m.

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DOI
Journal Article

Abstract  A survey of the density and population size of Bornean orang-utan (Pongo pygmaeus) was carried out in 1995 and 1996 in an area of peat swamp forest in the Sungai (River) Sebangau catchment, Central Kalimantan, Indonesia. Densities were calculated for four forest sub-types by counts of orang-utan sleeping platforms (nests) along line transects. Densities were found to be highest in the tall interior and mixed swamp forest sub-types. Low pole forest supported the lowest density. Habitat disturbance caused by logging was shown to affect orang-utan density within mixed swamp forest. The orang-utan population for a larger peat covered landscape unit (9200 km2), including the Sebangau catchment, was estimated to be between 5671 (±955) and 8951 (±1509) individuals, based upon the area of each forest type, the level of disturbance in each area and corrected to prevent overestimates. This study identifies the presence of a very large, self-sustaining orang-utan population in this region and emphasises the urgent requirement for greater protection of Kalimantan's peat swamp forests in the light of recent and rapid habitat degradation.

DOI
Journal Article

Abstract  This paper explores the long-term sustainability of Argentina’s specialization in genetically modified (GM) soybean cultivation. We perform an evidence-based assessment of the most relevant economic, social, and environmental implications of the “soybeanization” of Argentinian agriculture. Our diagnostic relies on a combination of published sources and a unique data set drawn from a field survey carried out in 2011 in two provinces of the Argentinian Pampas. This data set allows us to evaluate with a reliable empirical base the socio-economic impacts of GM soybean cultivation. Our analysis suggests a conflict between the success of the “soybeanization” of Argentinian agriculture measured in terms of production and profit records, and the social, economic, and environmental sustainability of this new model of production. On the one hand, GM soybean technological package adoption has increased farm productivity, and reduced the costs per unit produced, resulting in a dramatic increase in profits. On the other hand, the specialization of Argentinian agriculture on soybean cultivation has increased the dependence of public finances on the foreign exchange revenue generated by exports earnings. We also find a mixed empirical picture of changing land distribution patterns and labor displacement resulting from GM soybean expansion. Finally, we find that the environmental implications of agricultural biotechnology appear alarming and the long-term sustainability of GM crops highly questionable. Promoting sustainable agricultural growth has become not only desirable but necessary.

DOI
Journal Article

Abstract  Palm oil production has boomed over the last decade, resulting in an expansion of the global oil palm planting area from 10 to 17 Million hectares between 2000 and 2012. Previous studies showed that a significant share of this expansion has come at the expense of tropical forests, notably in Indonesia and Malaysia, the current production centers. Governmehts of developing and emerging countries in all tropical regions increasingly promote oil palm cultivation as a major contributor to poverty alleviation, as well as food and energy independence. However, being under pressure from several non-governmental environmental organizations and consumers, the main palm oil traders have committed to sourcing sustainable palm oil. Against this backdrop we assess the area of suitable land and what are the limits to future oil palm expansion when several constraints are considered. We find that suitability is mainly determined by climatic conditions resulting in 1.37 billion hectares of suitable land for oil palm cultivation concentrated in twelve tropical countries. However, we estimate that half of the biophysically suitable area is already allocated to other uses, including protected areas which cover 30% of oil palm suitable area. Our results also highlight that the non-conversion of high carbon stock forest (>100 t AGB/ha) would be the most constraining factor for future oil palm expansion as it would exclude two-thirds of global oil palm suitable area. Combining eight criteria which might restrict future land availability for oil palm expansion, we find that 234 million hectares or 17% of worldwide suitable area are left. This might seem that the limits for oil palm expansion are far from being reached but one needs to take into account that some of this area might be hardly accessible currently with only 18% of this remaining area being under 2 h transportation to the closest city and that growing demand for other agricultural commodities which might also compete for this land has not been yet taken into account.

DOI
Journal Article

Abstract  This article seeks to contribute to understanding trade as a development tool in Brazil. The nation seeks a unique development model as it faces regulatory challenges at both internal and international levels. The article highlights the case of ethanol as a prime example of this model.

DOI
Journal Article

Abstract  The United States (US) Renewable Fuel Standard and California's Low Carbon Fuel Standard support the use of soy biodiesel and renewable diesel in the transport fuel supply for climate mitigation. However, linkages between the markets for soy oil and palm oil, which is associated with very high land use change emissions, could negatively affect the climate performance of soy-based biofuels. This study estimates the own and cross-price elasticities for the supply of soy and palm oils in the US using country-level data from 1992 to 2016 under rational expectations, through a seemingly unrelated regressions system of equations. We find a positive cross-price elasticity of palm oil import with respect to soy oil price and a positive reaction of supply of soy oil to increase in prices of palm oil. These results suggest that US biofuel policies may underestimate substitution between soy and palm oils and thus overestimate the climate benefits from soy-based biofuel.

Technical Report

Abstract  The National Biofuels Policy of Brazil, the RenovaBio program, is expected to be implemented in late December 2019. Over forty biofuel plants have requested the certification process. Brazil’s total 2019 ethanol production is estimated at 34.45 billion liters, an increase of four percent compared to the revised figure for 2018. Total domestic demand for ethanol (fuel and other uses) for calendar year 2019 is estimated at 33.93 billion liters. Total Brazilian biodiesel production is estimated at 5.8 billion liters, an eight percent increase relative to 2018, based on the projected modest growth of the Brazilian economy and the increase of the biodiesel blend to eleven percent (B11) beginning in September 2019.

Technical Report

Abstract  Indonesia’s palm-based biodiesel industry enjoyed a large expansion in 2018 with the beginning of nationwide expansion of B20 to the non-public (Non-PSO) transport sector and a sharp jump in overseas demand. Domestic consumption is set for another large year-over-year increase in 2019 largely due to further expansion of B20 to the Non-PSO transport sector. Exports are forecast to remain elevated near 1.8 billion liters based on continued demand from the EU and China. Indonesia’s fuel ethanol consumption remains virtually zero since 2010 due to lack of financial support and a mandate that has not been enforced.

Journal Article

Abstract  Palm oil is the most widely traded vegetable oil globally, with demand projected to increase substantially in the future. Almost all oil palm grows in areas that were once tropical moist forests, some of them quite recently. The conversion to date, and future expansion, threatens biodiversity and increases greenhouse gas emissions. Today, consumer pressure is pushing companies toward deforestation-free sources of palm oil. To guide interventions aimed at reducing tropical deforestation due to oil palm, we analysed recent expansions and modelled likely future ones. We assessed sample areas to find where oil palm plantations have recently replaced forests in 20 countries, using a combination of high-resolution imagery from Google Earth and Landsat. We then compared these trends to countrywide trends in FAO data for oil palm planted area. Finally, we assessed which forests have high agricultural suitability for future oil palm development, which we refer to as vulnerable forests, and identified critical areas for biodiversity that oil palm expansion threatens. Our analysis reveals regional trends in deforestation associated with oil palm agriculture. In Southeast Asia, 45% of sampled oil palm plantations came from areas that were forests in 1989. For South America, the percentage was 31%. By contrast, in Mesoamerica and Africa, we observed only 2% and 7% of oil palm plantations coming from areas that were forest in 1989. The largest areas of vulnerable forest are in Africa and South America. Vulnerable forests in all four regions of production contain globally high concentrations of mammal and bird species at risk of extinction. However, priority areas for biodiversity conservation differ based on taxa and criteria used. Government regulation and voluntary market interventions can help incentivize the expansion of oil palm plantations in ways that protect biodiversity-rich ecosystems.

DOI
Journal Article

Abstract  Fire is a common tool for land conversion and management associated with oil palm production. Fires can cause biodiversity and carbon losses, emit pollutants that deteriorate air quality and harm human health, and damage property. The Roundtable on Sustainable Palm Oil (RSPO) prohibits the use of fire on certified concessions. However, efforts to suppress fires are more difficult during El Nino conditions and on peatlands. In this paper, we address the following questions for oil palm concessions developed prior to 2012 in Sumatra and Kalimantan, the leading producers of oil palm both within Indonesia and globally: (1) for the period 2012-2015, did RSPO-certified concessions have a lower density of fire detections, fire ignitions, or 'escaped' fires compared with those concessions that are not certified? and (2) did this pattern change with increasing likelihood of fires in concessions located on peatland and in dry years? These questions are particularly critical in fuel-rich peatlands, of which approximately 46% of the area was designated as oil palm concession as of 2010. Weconducted propensity scoring to balance covariate distributions between certified and non-certified concessions, and we compare the density of fires in certified and non-certified concessions using Kolmogorov-Smirnov tests based on moderate resolution imaging spectroradiometer Active Fire Detections from 2012-2015 clustered into unique fire events. We find that fire activity is significantly lower on RSPO certified concessions than non-RSPO certified concessions when the likelihood of fire is low (i.e., on non-peatlands in wetter years), but not when the likelihood of fire is high (i.e., on non-peatlands in dry years or on peatlands). Our results provide evidence that RSPO has the potential to reduce fires, though it is currently only effective when fire likelihood is relatively low. These results imply that, in order for this mechanism to reduce fire, additional strategies will be needed to control fires in oil palm plantations in dry years and on peatlands.

DOI
Book/Book Chapter

Abstract  The development of sustainable and clean energy sources has gained great importance worldwide due to realization of the urgent need to curb greenhouse gases’ emissions in order to mitigate the effects of climate change. Sugarcane biofuels are important alternative to fossil fuels as they offer environmental and socioeconomic advantages. Brazil leads the world for ethanol production from cane juice, an abundant renewable source in the country. In this context, the status of sugarcane crop in Brazil, capacity of its sugar and ethanol industry, and the current standing of its lignocellulosic biorefineries are presented in this chapter. Additionally, the impact of biofuels economy of Brazil, as well as the acceptance and adaptability at the user’s end are discussed. Moreover, new possibilities of 2G biofuel production after prospective technological improvements to make them even feasible are presented.

Meetings & Symposia

Abstract  Ethanol has gradually gain momentum in the world’s energy market in recent decades with Brazil the largest producers. The issue of price linkage among ethanol, sugar and oil is particular interesting and important in the context of Brazilian sugarcane sector. By accounting for the possible structural breaks in the data, we investigate the price linkage of the three commodities and discover that prices are not cointegrated in the first sub-periods but cointegrated in the second sub-period. Also oil price demonstrates weakly exogenous to the prices of the other two commodities; sugar prices appears to drive the ethanol price in the first sub-periods while in the second sub-period, they influence one another.

DOI
Journal Article

Abstract  In this paper we seek to understand the impact of expanded use of soybean oil biodiesel to address biofuel mandates on global vegetable oil markets, and in particular on the demand for palm oil. An open-economy equilibrium model is derived to investigate the market effects of biodiesel expansion on related energy and vegetable oil markets. The model is calibrated to represent the recent benchmark data in calendar year 2014. The simulation estimates suggest that the expanded use of soy oil for biodiesel in the US will have considerable impacts on world vegetable oil markets. The majority of the vegetable oil replacement is likely to occur through substitution of palm oil under a wide range of plausible elasticity values on the demand for vegetable oil and the demand substitution between soy oils and palm oils.

DOI
Journal Article

Abstract  The present paper studies the interdependencies between the energy, bioenergy and food prices. We develop a vertically integrated multi-input, multi-output market model with two channels of price transmission: a direct biofuel channel and an indirect input channel. We test the theoretical hypothesis by applying time-series analytical mechanisms to nine major traded agricultural commodity prices, including corn, wheat, rice, sugar, soybeans, cotton, banana, sorghum and tea, along with one weighted average world crude oil price. The data consists of 783 weekly observations extending from January 1994 to December 2008. The empirical findings confirm the theoretical hypothesis that the prices for crude oil and agricultural commodities are interdependent including also commodities not directly used in bioenergy production: an increase in oil price by 1 $/barrel increases the agricultural commodity prices between 0.10 $/tonne and 1.80 $/tonne. Contrary to the theoretical predictions, the indirect input channel of price transmission is found to be small and statistically insignificant.

DOI
Technical Report

Abstract  In 2003, the U.S. Department of Agriculture surveyed 21 dry-mill ethanol plants to estimate their 2002 production costs, including both variable (feedstock and plant operation) and capital expenses. These plants produced about 550 million gallons of ethanol in 2002. Net feedstock costs for the surveyed plants ranged from 39 to 68 cents per gallon in 2002. For cash operating expenses, the average energy expenditure was 17.29 cents per gallon. Labor costs ranged from 3 to 11 cents per gallon, maintenance costs from 1 to 7 cents, and administrative costs from 1 to 18 cents. For capital expenditures, new plant construction costs from $1.05 to $3.00 per gallon of ethanol. Average investment to expand existing ethanol production capacity was 50 cents per gallon; hence, expansion tends to cost less than new capacity. Comparison with a 1998 survey of ethanol producers showed that total operating costs in 2002 had changed very little from 1998. It also showed that the average cost of building new plants had dropped, possibly due to designs that emphasize economies of scale.

Journal Article

Abstract  Background Oil palm, Elaeis guineensis, is by far the most important global oil crop, supplying about 40% of all traded vegetable oil. Palm oils are key dietary components consumed daily by over three billion people, mostly in Asia, and also have a wide range of important non-food uses including in cleansing and sanitizing products. Main body Oil palm is a perennial crop with a > 25-year life cycle and an exceptionally low land footprint compared to annual oilseed crops. Oil palm crops globally produce an annual 81 million tonnes (Mt) of oil from about 19 million hectares (Mha). In contrast, the second and third largest vegetable oil crops, soybean and rapeseed, yield a combined 84 Mt oil but occupy over 163 Mha of increasingly scarce arable land. The oil palm crop system faces many challenges in the 2020s. These include increasing incidence of new and existing pests/diseases and a general lack of climatic resilience, especially relating to elevated temperatures and increasingly erratic rainfall patterns, plus downstream issues relating to supply chains and consumer sentiment. This review surveys the oil palm sector in the 2020s and beyond, its major challenges and options for future progress. Conclusions Oil palm crop production faces many future challenges, including emerging threats from climate change and pests and diseases. The inevitability of climate change requires more effective international collaboration for its reduction. New breeding and management approaches are providing the promise of improvements, such as much higher yielding varieties, improved oil profiles, enhanced disease resistance, and greater climatic resilience.

DOI
Journal Article

Abstract  For hundreds of years, sugarcane has been a main source of sugar, used as a sweetener, and alcohol, fermented from the plant juice. The high cost of petroleum towards the end of the twentieth century stimulated the development of new fermentation technologies for producing economically viable bioethanol from sugarcane as an alternative to importing petroleum. More recently, awareness of the effects of greenhouse gas emissions due to the global climate changes propelled bioethanol as a viable renewable fuel. Consequently, sugarcane gained importance as a bioenergy feedstock. However, the lack of knowledge about sugarcane physiology, notably on aspects of photosynthesis and source–sink relationship, has slowed the advance of this expanding bioenergy-producing system. Besides the changes in source–sink relationship, another option to increase bioethanol production even more would be to use a greater fraction of the total biomass of plants, i.e., not only the soluble sugars but also the sugars present in the cell wall fractions. Here, we review the history of sugarcane as a bioenergy crop and discuss some of the relevant routes that could be adopted in the near future to make sugarcane an even better feedstock for producing biofuels.

DOI
Journal Article

Abstract  Insular Southeast Asian peatlands have experienced rapid land cover changes over the past decades inducing a variety of environmental effects ranging from regional consequences on peatland ecology, biodiversity and hydrology to globally significant carbon emissions. In this paper we present the land cover and industrial plantation distribution in the peatlands of Peninsular Malaysia, Sumatra and Borneo in 2015 and analyse their changes since 1990. We create the 2015 maps by visual interpretation of 30 m resolution Landsat data and combine them with fully comparable and completed land cover maps of 1990 and 2007 (Miettinen and Liew, 2010). Our results reveal continued peatland deforestation and conversion into managed land cover types. In 2015, 29% (4.6 Mha) of the peatlands in the study area remain covered by peat swamp forest (vs. 41% or 6.4 Mha in 2007 and 76% or 11.9 Mha in 1990). Managed land cover types (industrial plantations and small-holder dominated areas) cover 50% (7.8 Mha) of all peatlands (vs. 33% 5.2 Mha in 2007 and 11% 1.7 Mha in 1990). Industrial plantations have nearly doubled their extent since 2007 (2.3 Mha; 15%) and cover 4.3 Mha (27%) of peatlands in 2015. The majority of these are oil palm plantations (73%; 3.1 Mha) while nearly all of the rest (26%; 1.1 Mha) are pulp wood plantations. We hope that the maps presented in this paper will enable improved evaluation of the magnitude of various regional to global level environmental effects of peatland conversion and that they will help decision makers to define sustainable peatland management policies for insular Southeast Asian peatlands.

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