OECD Observer
Biofuels: A second chance

As biofuel production grew fourfold from 2000 to 2008, criticism of the industry seemed to increase nearly as dramatically. Production of these transport fuels, which are based on food crops such as grains, sugar cane and vegetable oils, competes with food crops and drives up food prices, experts argue. Also, from land-clearance needed for cultivation, production and use, these biofuels may actually increase, rather than reduce, greenhouse gas emissions.

Now, people are turning their attention to so-called second-generation biofuels which, depending on the feedstock source and techniques used, could overcome these drawbacks. But caution is still required, according to Sustainable Production of Second-Generation Biofuels: Potential and perspectives in major economies and developing countries.

Most second-generation biofuels, still in the R&D stage in a few developed countries and some large emerging economies like Brazil, China and India, are produced from woody, lignocellulosic plants that can either be cultivated as dedicated energy crops or retrieved from agricultural and forestry residues. Using residues would have a particular advantage over first-generation biofuels in that there would be no immediate need to cultivate more land or compete with food crops.

According to the authors, the estimated $125-250 million cost of commercial second-generation biofuel plants could be financed by both foreign direct investment and domestic funding in most of the eight countries studied–Brazil, Cameroon, China, India, Mexico, South Africa, Tanzania and Thailand. Moreover, these countries tend to have the skilled engineers required for biofuel conversion.

But there are still a lot of unknowns, including the environmental impact of production, which depends on how the feedstock is converted to biofuel and site-specific conditions, such as climate, soil type and crop management. Land use must be carefully mapped and planned to avoid changes that could be detrimental to the environment or end up driving out food crops again. Also, the introduction of non-native energy crops could threaten local biodiversity. The book recommends intensive R&D over the next 10-15 years and more detailed research, including a global road map for technology development, an impact assessment of commercial secondgeneration biofuel production, and improved data on available land.

ISBN 978-92-64-08424-7

©OECD Observer No 278, March 2010