Spire

Biofuels

This resolution was adopted at Spires Grand Meeting 2016

Biofuels are fuels produced from biological materials. First-generation biofuels consist of bioethanol and biodiesel, produced respectively from starchy crops such as sugar cane, corn, wheat and potatoes, and oil crops such as rapeseed, soybean and palm oil. Second and third-generation biofuels use raw materials that are neither food crops nor competing with food production. Examples of these are cellulose from wood, agricultural waste and kelp. Unfortunately, second and third-generation biofuels are in an early stage. As of today, they account for a very small portion of the total biofuel production.

Productions of first-generation biofuels compete with food on the market, for land and for water. This has very negative consequences for food security in developing countries, and had much of the blame for the sharp rise in food prices in 2008, although higher oil prices, drought and speculation also played a role. The use of biofuels connects food prices and oil prices together in an unfortunate way. Increased oil prices lead to increased biofuel prices, which in turn leads to higher food prices. Oil prices are generally very vulnerable both speculation and political changes, and these fluctuations are now transferred to food prices. Fluctuating food prices is severe particularly for the urban poor who spend a large proportion of their income on food, as well as for small-scale farmers who rely on stable production conditions.

Biofuels are both an indirect and direct driving force of large land investments that can lead to land grabbing. Biofuels contribute indirectly to the global scramble for land by driving up food prices. Biofuels also contribute directly to land investments, especially through the projects producing biofuels for export to the EU. Not all land investments involve land grabbing however. Proponents for land investments argue that they bring with them capital and farming techniques that improve productivity in agriculture. This may create jobs for the local communities and tax revenue for the governments. An increase in food production can also lead to better food security. Some also claim that Africa has a lot of marginalised, empty land, where companies can establish productions without displacing local small-scale farmers. However, there are several problems with these arguments.

The notion of available marginalised land in Africa is extremely exaggerated. Often, the so-called marginalised areas are in use, both by local farmers and nomads. In addition, land investors often choose not to invest in marginal areas, because the most fertile areas are the most attractive ones. This is also true for local small-scale farmers, which leads to locals being squeezed out. Large-scale plantations could possibly create some jobs, but usually they are given to workers outside the local community. While large-scale biofuel production is capital-intensive, small-scale rural farming is labour intensive and requires more workers per hectare. There are therefore more jobs lost than created

Land investments also include the use of groundwater, which is rarely taken into account in when the conditions of the land acquisition is negotiated; land investors often have no limit on how much water they can use. Overuse of water has a negative impact on local access to water for drinking and agricultural production, impacts far beyond the areas that are taken over. Finally yet importantly, the tax revenues are often not what the authorities had hoped for. African countries have often been desperate to attract the investors and therefore offered very favourable tax conditions. Combined with the use of tax havens, the tax revenue from land investments have been disappointing. Not least, many of the projects have been only of speculative character, which never led to any increased production or tax revenues. Unsuccessful projects are a double-tragedy. Small-scale farmers are driven from the land, and in addition, none of the positive consequences such investments could have generated, is realised.

Political support for biofuel production was initially a sympathetic idea, as a way to reduce greenhouse gas emissions. Unfortunately, the negative effects on food security are greater than the expected climate benefits. The real mitigation effect of first-generation biofuels has also been questioned widely. The reason for this is that the production of biofuels largely is based on intensive, large-scale plantation production, with a high consumption of energy and inputs.

Spire demands that:

  • Public incentives for production of biofuels that compete with food, must be reduced and eventually eliminated completely.
  • Norwegian biofuels, such as those used in the public transport sector must be second and third-generation biofuels (e.g. made from food waste).
  • Biofuels must not become an excuse for Western politicians and consumers - we must still reduce our overall energy consumption.