EU Announces Guidelines for Biofuel Sustainability

The Commission decided on 10 June 2010 to encourage industry, governments and NGOs to set up certification schemes for all types of biofuels, including those imported into the EU. It laid down what the schemes must do to be recognised by the Commission. This will help implement the EU's requirements that biofuels must deliver substantial reductions in greenhouse gas emissions and should not come from forests, wetlands and nature protection areas. The rules for certification schemes are part of a set of guidelines explaining how the Renewable Energy Directive, coming into effect in December 2010, should be implemented.

• Sustainable Biofuel Certificates: The Commission encourages industry, governments and NGOs to set up "voluntary schemes" to certify biofuel sustainability – and explains the standards these must meet to gain EU recognition. One of the main criteria is that they have independent auditors which check the whole production chain, from the farmer and the mill, via the trader, to the fuel supplier who delivers petrol or diesel to the filling station. The Communication sets standards requiring this auditing to be reliable and fraud-resistant.
  
• Protecting untouched nature: The Communication explains that biofuels should not be made from raw materials from tropical forests or recently deforested areas, drained peatland, wetland or highly biodiverse areas – and how this should be assessed. It makes it clear that the conversion of a forest to a palm oil plantation would fall foul of the sustainability requirements.
  
• Promote only biofuels with high greenhouse gas savings: The Communication reiterates that Member States have to meet binding, national targets for renewable energy and that only those biofuels with high greenhouse gas savings count for the national targets, explaining also how this is calculated. Biofuels must deliver greenhouse gas savings of at least 35% compared to fossil fuels, rising to 50% in 2017 and to 60%, for biofuels from new plants, in 2018.

U.S. Allocates Up to $24 Million for Algae Biofuels Projects

The U.S. Department of Energy will award as much as $24 million in new grants to three research projects aimed at commercializing biofuels derived from algae. The projects will be carried out by three groups that include partners from academia, national laboratories and private companies, according to a statement from the department.

The three consortia selected for funding are:

• Sustainable Algal Biofuels Consortium (Mesa, Arizona): Led by Arizona State University, this consortium will focus on testing the acceptability of algal biofuels as replacements for petroleum-based fuels. Tasks include investigating biochemical conversion of algae to fuels and products, and analyzing physical chemistry properties of algal fuels and fuel intermediates. (DOE share: up to $6 million)
• Consortium for Algal Biofuels Commercialization (San Diego, California): Led by the University of California, San Diego, this consortium will concentrate on developing algae as a robust biofuels feedstock. Tasks include investigating new approaches for algal crop protection, algal nutrient utilization and recycling, and developing genetic tools. (DOE funding: up to $9 million)
• Cellana, LLC Consortium (Kailua-Kona, Hawaii): Led by Cellana, LLC, this consortium will examine large-scale production of fuels and feed from microalgae grown in seawater. Tasks include integrating new algal harvesting technologies with pilot-scale cultivation test beds, and developing marine microalgae as animal feed for the aquaculture industry. (DOE funding: up to $9 million)
  

Massive investments in Ethanol Cellulosic R&D and moving from laboratory to real World

• SunOpta and GreenField Ethanol Create Cellulosic Ethanol
• BP announced $500 million over 10 years for Energy Biosciences Institute, Biobutanol partnership with DuPont
• SunOpta BioProcess Group is raising $30 million to fund exciting growth projects utilizing the Group's proprietary technology in the production of cellulosic ethanol
• Diversa and Celunol to merge to create Integrated Cellulosic Ethanol Company
• Shell invests $46 million in Iogen
• Diversa : 15 million shares to acquire the outstanding equity of Celunol, and up to $20 million in debt financing to fund its operations prior to closing
• Syngenta provide $16 M in R&D funding through 2009 to it partner Diversa

Scientists have been able to produce cellulosic ethanol from numerous feedstock sources in smaller pilot plants under nearly ideal conditions, the experts said. But making the technology work on a much larger scale, and thus making it a profitable enterprise, remains a key challenge, they said.

"Enzymes work really, really well at the pilot scale or the lab scale," said Jeff Passmore, executive vice president of Iogen Corporation, which plans to open a cellulosic ethanol plant in Idaho using barley straw as its main feedstock.

Agricultural commodities - Biofuels 'to push farm prices up'

A global switch from growing crops for food to growing them for biofuel production is boosting international prices paid for food, says a United Nations assessment of international farming trends. ``The switch to growing fuel crops will take land out of food production and increase the price of commodities,'' said the report, jointly prepared by the Food and Agriculture Organisation and the OECD.

The increasing use of grains such corn and wheat as feedstocks for the production of ethanol has led to an increase in food prices in the US. The International Grain Council reports that global output of grains is forecast to total 1660 M tonnes in 2007 (up from 1569 M tonnes in 2006) but that demand is expected to reach 1680 M tonnes. Since 2000, demand for corn for ethanol production in the US has tripled, with ethanol plants now consuming 20% of the US corn crop. A switch to biofuels to reduce oil consumption is being encouraged by the governments of 41 countries. As a result, demand for grain is expected to rise by 1.9%/y through 2017 compared with just 1.2%/y in the 1990s.

"Bioenergies have become a key factor in the functioning of agriculture markets," Loek Boonekamp, a senior OECD official.

"In the medium term we believe that they could lead to prices on international markets rising quite considerably, at higher levels than what we had predicted in former outlooks and above the average of the last 10 years."

Biofuels are gradually taking over as the main growth driver of agriculture demand. Goldman Sachs says that if government policies are adopted in full, global demand for biofuels could increase from 10bn gallons a year to 25bn gallons by 2010.

Goldman expects the trend rate of growth in demand for agricultural commodities to rise from 1.9 per cent a year between 1997 and 2006 to 2.6 per cent a year between 1996 and 2015.

U.S. President Bush Urges Congress to Mandate 35 Billion Gallon Alternative fuels by 2017

U.S. President George Bush asked Congress to pass legislation forcing by 2017 the replacement of about 35 billion gallons/year of U.S. gasoline with a variety of alternatives including ethanol and biodiesel.

If enacted, the so-called “Alternate Fuels Standard” (AFS) would represent about five times the current “renewable fuel standard” (RFS), which forces about 7.5 billion gallons of mostly corn-based ethanol into the U.S. gasoline pool. Biodiesel also qualifies under the current RFS, but ethanol in gasoline is usually the cheaper and easier route to refiner compliance with RFS mandates.

“The Alternative Fuel Standard will include sources such as corn ethanol, cellulosic ethanol, biodiesel, methanol, butanol, hydrogen, and alternative fuels,” the White House said in a summary of the new Bush plan.

“The increased standard will contain multiple safety valves. The EPA Administrator and the Secretaries of Agriculture and Energy will have authority to waive or modify the standard if they deem it necessary, and the new fuel standard will include an automatic safety valve to protect against unforeseen increases in the prices of alternative fuels or their feedstocks.”

What’s more, imported “alternative fuels” would be allowed under the AFS. “Importing alternative fuels also increases the diversity of fuel sources, which further increases our energy security,” the White House said.

In a related scheme, Bush will ask Congress to “reform and modernize” the current Corporate Average Fuel Economy (CAFÉ) standards for cars and light trucks. “In 2017, this will reduce projected annual gasoline use by up to 8.5 billion gallons, a further 5% reduction that, in combination with increasing the supply of renewable and alternative fuels, will bring the total reduction in projected annual gasoline use to 20%,” the White House said.

“These amounts are based on an assumption that on average, fuel efficiency standards for both light trucks and passenger cars are increased 4% per year, beginning in Model Year 2010 for cars and Model Year 2012 for light trucks. Given the changing nature of the marketplace for both cars and light trucks, the Secretary of Transportation will determine the actual standard and fuel savings in a flexible rulemaking process.” Bush also urged Congress to continue supporting fuel-efficient vehicle research. “We need to continue with important research into plug-in and advanced hybrid vehicles, and expand the use of high efficiency clean-diesel vehicles and biodiesel fuel. We must continue investing in new methods of producing ethanol and other biofuels,” he said.

EU targets greenhouse gas emissions cut of 20% by 2020

The Council also backed cuts in EU greenhouse gas emissions by 20% by 2020 from 1990 levels, and by 30% if other industrialized nations join in, and agreed to back collective cuts of 60% to 80% by 2050 compared with 1990 levels, German Chancellor Angela Merkel said in Brussels, chairing her first EU summit.

This target could cost the bloc up to 1.1 trillion euros, according to a new study by consulting group McKinsey & Co. The study, entitled "A cost curve for greenhouse gas reduction", was described in the Tuesday edition of Germany daily Die Welt.

"We expect, based on a well-balanced, sensible use of available environmental protection technologies, annual costs of between 60 and 80 billion euros out to the year 2020," the newspaper quoted McKinsey energy expert Thomas Vahlenkamp as saying.

European road map to reach 20% target for renewable energy by 2020

The European Union will have to move up a gear if it really wants to exploit the full energy potential of renewable sources, previous measures having been described as either inadequate or non-existent. The Commission's Energy Package of 10 January 2007 contains a road map to help member states achieve 20% of total energy production from renewable energy sources by 2020. European Commission unveiled new targets for including a minimum 10 percent biofuels within vehicle fuels by 2020.

That would result in total costs of between 800 billion to 1.1 trillion euros over the next 14 years.