Bi f l F i d F ?Bi f l F i d F ?Biofuels: Friend or Foe?Biofuels: Friend or Foe?

Thawat WatanatadaThawat WatanatadaA.T. TriA.T. Tri

TBLI Conference Asia TBLI Conference Asia 20082008Bangkok, ThailandBangkok, Thailand

May May 2929, , 20082008

Photo credit: Alternative Fuels Institute

May May 2929, , 20082008 1111

“Life first, cars second.”- Evo Morales, President of Bolivia

Photo credit: The Guardian

Photo credit: BBC News

“Biofuels have made food too expensive for the poor.”- Alan Garcia, President of Peru

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“It’s in our national interest that our farmers grow energy ”farmers grow energy.- George W. Bush, President of the United StatesUnited States

Photo credit:

US National Institute of Health

“Bi f l ’t th ill i th t“Bi f l ’t th ill i th t“Biofuels aren’t the villain that “Biofuels aren’t the villain that threaten food security.”threaten food security.”

L l d Sil P id t f B il- Lula de Silva, President of Brazil

Photo credit: Spiegel

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“Biofuels are the clean energy scam”

“Is ethanol getting a bum rap?”Is ethanol getting a bum rap?

4May May 2929, , 20082008 44

“Biofuels pit the 800 million people o ue s p t t e 800 o peop ewith cars against the 800 million people with hunger problems.” - Lester Brown, Earth Policy Institute

Photo credit: TimePhoto credit: Time

“Bi f l ll“Biofuels are a very, very small factor in rising food costs.”

f S f- David Morris, Institute for Local Self-Reliance

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The questions…

Have biofuels really caused the food crisis?

Sh ld bi f l ?Should we support biofuels?

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Ethanol prices track oil pricesEthanol prices track oil prices

Ethanol Price vs. Oil Price

100

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02000 2001 2002 2003 2004 2005 2006 2007 2008

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Oil (USD/barrel) Ethanol (USD/gallon)Data sources: US Department of Energy & North American Millers’ AssociationData sources: US Department of Energy & North American Millers’ Association

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Corn prices track ethanol pricesCorn prices track ethanol prices

Corn vs. Ethanolo o

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r to

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Corn (USD per ton) Ethanol (USD per gallon)Data sources: North American Millers’ Association & UN Food and Agricultural OrganizationData sources: North American Millers’ Association & UN Food and Agricultural Organization

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Sugar prices track ethanol pricesSugar prices track ethanol prices

Sugar vs. Ethanolg

1416

ar

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n

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sug

a

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Sugar (USc per lb) Ethanol (USD per gallon)Data sources: North American Millers’ Association & UN Food and Agricultural OrganizationData sources: North American Millers’ Association & UN Food and Agricultural Organization

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Wheat prices track corn pricesWheat prices track corn prices

Wheat vs CornWheat vs. Corn

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Wheat (USD per ton) Corn (USD per ton)Data source: UN Food and Agricultural OrganizationData source: UN Food and Agricultural Organization

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Chain of causes and effectsChain of causes and effects

Oil prices

Biofuel pricesBiofuel prices

Biofuel crop pricesBiofuel crop prices

Food crop pricesp p

Food pricesp

The above explains why food crop and food prices have skyrocketedThe above explains why food crop and food prices have skyrocketed

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Other causes of food price crisisOther causes of food price crisisOther causes of food price crisisOther causes of food price crisis

① Energy price hikes raising the costs of food inputs① Energy price hikes raising the costs of food inputs

② Greater demand for food in China and India② Greater demand for food in China and India

③ Shortage of land for food cropsg p

④ Weather events causing temporary food shortages

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Rising energy prices affect food costs

Indirect effect of energy price rise via food feedstock is greater than direct effect.

13May May 2929, , 20082008 1313Data source: US Department of AgricultureData source: US Department of Agriculture

than direct effect.

Rise in income in China and IndiaRise in income in China and India

Rise in income in China and India has a small effect, as Chinese and Indian meat and grain consumption is still small.

14May May 2929, , 20082008 1414Data source: US Department of AgricultureData source: US Department of Agriculture

Land AvailabilityLand AvailabilityLand AvailabilityLand Availability

Case of Brazil: Ethanol production

Less than ½ % of Brazil’s land for ethanol sugarcane

Potential expansion of ethanol sugarcane area 34 times

15May May 2929, , 20082008 1515Data source: Uniao da Agroindustria Canavieira de Sao PauloData source: Uniao da Agroindustria Canavieira de Sao Paulo

Land AvailabilityLand AvailabilityCase of Thailand: Ethanol production thru Case of Thailand: Ethanol production thru 20222022

Land AvailabilityLand Availability

Graph of ethanol production volumesp p

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ay

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s

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

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M

Molasses Cassava Sugarcane/Sweet sorghum Cellulose* Unpublished sources* Unpublished sources

Molasses Cassava Sugarcane/Sweet sorghum Cellulose

Marginal lands will be used to grow biofuel crops.

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Land AvailabilityLand Availability

Case of the USA: Ethanol production thruCase of the USA: Ethanol production thru 20152015

Land AvailabilityLand Availability

Case of the USA: Ethanol production thru Case of the USA: Ethanol production thru 20152015

Target for 2015: 230% of 2007 level

All increase from boosting corn yield per acre

No reduction in corn for food and feedNo reduction in corn for food and feed

No increase in planted areap

17May May 2929, , 20082008 1717Data source: McKinsey & CompanyData source: McKinsey & Company

Biofuels did not cause food crisis

Biofuel price hikes is an economic fallout of oil price hikes

Biofuels did not cause food crisis

Biofuel price hikes is an economic fallout of oil price hikes

Biofuels is not the original cause of food crisisg

Real cause of food crisis: Sharp rise in petroleum price

Photo credit: Spiegel

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Photo credit: TimePhoto credit: CNN

Main benefits of biofuelsMain benefits of biofuelsMain benefits of biofuels Main benefits of biofuels

Keep energy prices down

Biofuels provide 50% of increase in non-OPEC oil supply

Biofuel supply keeps crude oil price from rising by 15%

19May May 2929, , 20082008 1919Data source: International Energy Agency & The Wall Street JournalData source: International Energy Agency & The Wall Street Journal

Main benefits of biofuelsMain benefits of biofuels

H l ll f

Main benefits of biofuels Main benefits of biofuels

Help small farmers

More income for 500 million smallholdersMore income for 500 million smallholders

Impact not immediate but enormous over time p

20May May 2929, , 20082008 2020Photo credit: Telegraph, UK

How can we support biofuels?How can we support biofuels?How can we support biofuels?How can we support biofuels?

Grow biofuels without harming the environment or displacing food crop landsdisplacing food crop lands

Commercialize second and third generation biofuelsCommercialize second and third generation biofuels –from cellulose and algae

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Second generation biofuels

Cellulose biofuel technologiesCellulose biofuel technologies

Can use agricultural residues or plants grown on marginal lands with few fertilizers or pesticides

E it l CO2 th fi t ti bi f lEmit less CO2 than first generation biofuels

Yield at least twice more energy per acreYield at least twice more energy per acre

Commercial production in 5 to 10 years

22May May 2929, , 20082008

Photo credit: Energy Future Coalition

Third generation biofuelsThird generation biofuels

Algae biofuel technologies:

Can use algae species that grow in saltwater and other harsh conditions

Yield 30 times more energy per acre than land plants

Commercial production in 10 to 15 years?

23May May 2929, , 20082008 2323

Photo credit: Sheepscot Valley Conservation Association

Third generation biofuelsThird generation biofuelsTo replace all petroleum used in the US with algae fuel

i l d li htl l th M l d

gg

requires a land area slightly larger than Maryland

Map credit: WikipediaMap credit: Wikipedia

24May May 2929, , 20082008Data source: US Department of EnergyData source: US Department of Energy

Myth in the MediaMyth in the Media

Bi f l t di tl ith f d f l dBiofuels compete directly with food for land

We must choose between food and fuel

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RealityReality

If oil prices remain high …..

Farmers will keep growing biofuel cropsFarmers will keep growing biofuel crops

Bi f l ill b h t tBiofuels will be here to stay

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Ways to deal with biofuelsWays to deal with biofuels

① End subsidies and tariffs that support inferior biofuels

① Stop deforestation and employ marginal lands

① Practice precision farming and promote biodiversity

② Adopt high yield biofuel technologies

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Think Food and FuelThink Food and Fuel

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Thank you!Thank you!

May May 2929, , 20082008 29292929