Estimates of global potential for biomass that can be converted into fuels vary widely. One recent study concluded that by 2050, biomass theoretically could supply 65% of the world’s current energy consumption, with sub-Saharan Africa, the Caribbean, and Latin America accounting for roughly half of this global potential. In tropical countries, high crop yields and lower costs for land and labor provide an economic advantage that is hard for countries in temperate regions to match.

The potential market demand for ethanol and biodiesel also varies widely. While gasoline commands a much larger share of the market in the U.S. than diesel, diesel dominates in Europe and is often the preferred fuel for vehicles in developing countries.

“The gradual move away from oil has begun. Over the next 15 to 20 years we may see biofuels providing a full 25% of the world’s energy needs.”
– Alexander Müller, Food and Agriculture Organization of the United Nations

Many countries, in both tropical and temperate regions, are capable of producing surplus biomass that can be used for energy. For example:

  • Brazil and the U.S. are the world’s leading producers of ethanol at more than four billion gallons a year each – Brazil from sugar cane, the U.S. from corn. All Brazilian gasoline must contain at least 20% ethanol, which is distributed through a network of more than 25,000 filling stations. Thanks to its oil, ethanol, and hydroelectric resources, Brazil expected to become self-sufficient in energy in 2006, and its ethanol producers say they can compete with oil at $30 a barrel. Brazil is also rapidly developing its biodiesel industry and was a pioneer in introducing flexible-fuel cars, which can run on E100, gasoline, or any mix in between. In the first half of 2006, more than 80% of all new cars sold in Brazil were FFVs. Roughly a million cars a year are sold in Brazil.
  • Europe is the world’s largest producer of biodiesel, which it makes principally from rapeseed (canola), soy, and sunflower seeds. In 2005, Europe produced nearly a billion gallons of biodiesel (a 65% increase from 2004), about half from Germany alone. Ethanol represented just 20% of the biofuels market.
  • China produced about 340 million gallons of ethanol in 2005, most of it from corn. Several provinces have developed E10 blending and refueling infrastructure. The Chinese government is now encouraging ethanol production from non-grain sources such as cassava, sweet sorghum, and sweet potato, and it is supporting R&D into cellulosic ethanol.
  • Plans for increased biofuels production are also advancing in Latin America (including Colombia and Peru), Asia (India, Thailand, Malaysia, and Australia), Africa (especially South Africa but possibly also Zimbabwe, Madagascar, Malawi, and Mozambique), and Eastern Europe (Romania, Ukraine, and Russia). For example:

    • The Indian government has identified nearly 100 million acres of land where jatropha can be grown as a biofuel and hopes to replace 20% of diesel consumption in five years.
    • Malaysia, the world’s top producer of palm oil, has approved licenses for 52 biodiesel plants with a combined capacity of 1.5 billion gallons a year. (However, the destruction of tropical forests for palm cultivation is a major environmental concern.)
    • The Australian government has set a target of producing nearly 100 million gallons of ethanol annually by 2010.

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Biomass provides a surprisingly large amount of the world’s energy – 10% of total global primary energy consumption – but most of that is wood and charcoal gathered and used in the most primitive ways, as shown at right.

More than 2.4 billion people, generally among the world’s poorest, rely directly on wood, crop residues, dung, and other biomass fuels for their heating and cooking needs. In rural sub-Saharan Africa, women carry on average 11 pounds of wood 3 miles every day to meet their household needs for fuel.

Burning this biomass in inefficient stoves or over open flames is in many cases the only way to stay warm or cook a meal – but such stoves are a health and safety hazard. The smoke inhaled while cooking is responsible for more than 1.6 million deaths annually, mostly among women and children. More than half of these deaths occur among children under five years of age. In developing countries with high mortality rates overall, indoor air pollution ranks eighth in terms of the risk factors that contribute to disease and death. Moving away from these dirty uses of biomass is a clear public health priority.

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Oil fuels the transportation sector everywhere, and in many parts of the world it is also used for space heating and power generation. As the price of oil has risen, this dependence has caused heavy economic burdens. Ten years ago, when the world agreed on debt relief for the poorest countries in sub-Saharan Africa, the price of oil was $22 a barrel. Over the last four years, the price has tripled. As shown on the previous page, higher oil prices (calculated at $60 per barrel) now cost Ethiopia, for example, nearly five times as much as it is gaining from debt relief.

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Sustainable biofuel development can help bring modern energy services to more people, particularly in rural areas. It can also foster greater investment in agriculture, which employs 75% of the world’s poor. It can create new job opportunities in rural areas and provide a major new source of income for farmers. By producing transportation fuel, farmers will be entering a market with higher prices and rising demand. Growing energy crops is more likely to attract the kind of foreign investment that can modernize their agricultural practices – and increase their food production as well.

The Food and Agriculture Organization of the United Nations notes these benefits as well: “Energy plantations and crops (in particular perennial crops) can help to prevent soil erosion by providing a cover which reduces rainfall impact and sediment transport. Annual energy crops can also allow diversification and expansion of crop rotations. Deforested, degraded and marginal land could be rehabilitated as bioenergy plantations which could combat desertification and increase food production.”

Micro example: Biodiesel produced from jatropha nuts was used in Mali to provide affordable, decentralized energy services, fueling engines that could power other equipment or support a mini-grid for lighting, refrigeration, and electric pumps for small water distribution networks or irrigation systems. A jatropha hedge in Mali is shown at right. This project increased annual income per participating woman from about $40 to $100 and freed two to six hours of her time per day. Villages experienced higher levels of schooling for girls, who were no longer pulled out of school to assist their mothers with household chores. The project also stimulated micro-level business activities for village men in blacksmithing, carpentry, and mechanics.

Macro example: In Brazil ethanol production has created an estimated one million jobs and reduced the cost of oil imports by $43.5 billion between 1976 and 2000.

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If carried out on a large scale, the increased use of agricultural resources for energy will have the effect of raising the prices of most commodity crops and reducing the need for subsidies – with particular benefit for producers of commodity crops in developing countries. An analysis by researchers at the University of Tennessee found that increased demand for energy crops would all but eliminate the need for price-based support payments for most crops in the U.S. In other words, an aggressive program of bioenergy development would lead to reductions in government support to farmers without any loss of income.

In the industrialized world, the problem in agriculture is not one of shortage but overproduction – which is why there are perennial surpluses. Excess crops are shipped overseas, where they end up undercutting and impoverishing farmers in the developing world, who cannot compete with subsidized crops from abroad.

Negotiations in the Doha Development Round of the World Trade Organization broke down in 2006 because of disputes over agricultural subsidies. If governments took steps to raise biofuels production to 15% or more of global petroleum demand, the global market in agriculture could double or triple in volume and value. That would create a win-win situation for all involved, and the subsidy issue would diminish in importance.

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According to the Food and Agriculture Organization of the United Nations (FAO), increased food production can keep pace with a growing global population. In a 2002 report, FAO observed:

In recent years the growth rates of world agricultural production and crop yields have slowed. This has raised fears that the world may not be able to grow enough food and other commodities to ensure that future populations are adequately fed. However, the slowdown has occurred not because of shortages of land or water but rather because demand for agricultural products has also slowed. This is mainly because world population growth rates have been declining since the late 1960s, and fairly high levels of food consumption per person are now being reached in many countries, beyond which further rises will be limited. But it is also the case that a stubbornly high share of the world’s population remains in absolute poverty and so lacks the necessary income to translate its needs into effective demand.

On a global scale, malnutrition is caused not by a lack of food but by a failure to distribute it or a lack of money to pay for it. And certainly poverty, especially in urban areas, is exacerbated by rapid population growth.

Agriculture remains the main activity in the developing world. The world’s farmers are fully capable of increasing the amount they produce, but, in order for this to happen, demand must increase. Poverty reduces global food demand and acts as a brake on food production. Most of the world’s poorest people live in rural areas and work the land.
Increased demand for agricultural products thus would mean more farm income and less poverty, more productive agriculture, more food, more rural economic development, and reduced migration to cities.

Many developing countries still have a significant quantity of land available that is well adapted to rain-fed crops – about as much as now is being farmed (over 1.7 billion acres). These lands do not include areas inhabited by human beings, forests, or protected areas. If a country can produce and export biofuels, it will have a stronger economy and more resources to address the needs of the poor. Africa, with its significant sugar cane production potential, is often cited as a region that could profit from Brazil’s experience and technology, although obstacles to realizing it (infrastructure, institutional, etc.) should not be underestimated.

According to the FAO, in developing countries almost 70% of future increases in crop production will come from higher yields, around 20% from an expansion of arable land, and around 10% from multiple cropping and shorter fallow periods. Some regions will face serious water shortages, and they will need to use water more efficiently, as agriculture represents about 70% of all fresh water consumed by humans. Appropriately regulated genetically modified crop varieties could help to sustain farming in marginal areas and to restore degraded lands to production.

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