Industry calls for more support for biofuels following IEA report

Source: By Susanne Retka Schil, Ethanol Producer Magazine • Posted: Wednesday, November 14, 2012

The biofuels industry responded to the latest report from the International Energy Agency by pointing to the role renewable fuels can play in the world energy outlook. Overall global energy demand will grow by more than one-third by 2035, the IEA report states, with China, India and the Middle East accounting for 60 percent of the increase. And, the U.S. will become the largest oil producer in the world. By 2030, the report estimates, the U.S. could be a net oil exporter.

“This report is the story of two Americas: one striving for energy independence and the other mired in its addiction to oil,” said Adam Monroe, president of Novozymes North America, in statement. “On one side, the United States could be energy independent by 2035, aiding the creation of new technologies like advanced biofuels – which we’re now making from agricultural residue and household trash. On the other, we’re spending seven times more supporting fossil fuels than we do renewable energy. With so much at stake for the economy, we need the private investment, careers and security that clean energy provides.”

The IEA notes the great disparity in investments globally in fossil fuels, $523 billion, compared to renewables, $88 billion. The IEA explains that reducing the pollution caused by the burning of fossil fuels and addressing the issue of climate change will require nations to greatly reverse this imbalance in support.

“We cannot continue to rely on and subsidize a dependence on crude oil that continues to hamper economic growth when biofuels are already making a significant contribution to the global economy,” said Bliss Baker, spokesperson for the Global Renewable Fuels Alliance.

The GRFA pointed to IEA calling the current “unsustainable energy system” that is “putting a brake on our economy” because the crude oil industry is receiving record subsidies and oil prices are still at an all-time high. According to a GRFA commissioned report released earlier this year, the global biofuels industry contributed $277.3 billion to the global economy and supported nearly 1.4 million jobs in 2010.

With the IEA projecting a one-third increase in global energy demand, energy-related CO2 emissions are estimated to rise from a 31.2 gigatonnes in 2011 to 37 gigatonnes in 2035, contributing to a long term average temperature increase of 3.6 degrees Celsius, according to the IEA report. The GRFA pointed out in its statement that ethanol production alone will reduce greenhouse gas (GHG) emissions by 100 million tons globally. This is a reduction of 276,000 tons of GHGs per day, which is the equivalent of approximately 20.2 million cars being taken off the road per year.

“Biofuels offer a positive economic boost and cleaner air. We must quickly adopt policies that encourage the development of crude oil alternatives like biofuels for the sake of our economy and environment,” concluded Baker.

The American Coalition for Ethanol has also weighed in on the report, noting that media coverage has mischaracterized its findings. “Media headlines applaud the part of IEA’s report predicting the U.S. will be the world’s largest oil producer by 2020, but ignore the fact that run will be short-lived and disregard the costs consumers and the planet will bear,” said Brian Jennings, executive vice president of ACE. “IEA clearly states oil will be more expensive, more damage will be done to the environment, and OPEC will end up controlling more than half of the world’s oil by 2035.”

“Isn’t it ironic that some of the same interest groups and lawmakers who are attacking America’s ethanol industry and calling for repeal of the renewable fuel standard (RFS) are also now seemingly blind to the consequences of fracking our way to energy independence,” Jennings continued. Regarding fracking shale oil and mining tar sands, Jennings said that these unconventional sources of oil are more expensive to find, more harmful to the environment and can’t replace the amount of fuel the U.S. ethanol industry currently provides. “Oil companies would need to discover three more Bakken oil shale formations or construct three Keystone XL Pipelines, just to replace current ethanol production levels,” Jennings said.