Ah but the Irish decision maker in question is Eamon Ryan who has never claimed that his goal is to maximise Ireland’s economic benefit within the international accounting rules without taking account of the actual impact on the climate. Quite the reverse in fact.

And by the way, the sixth paragraph of your original post contradicts your claimed perspective.

You wrote
“A carbon tax would [only] appropriately incentivise biofuel if [...] the tax is high enough to achieve the target GHG atmospheric concentration”

To me, this means that you would want to put additional incentives on biofuels to make up for the shortfall in emission reduction elsewhere.

I would think that cost-effectiveness is a necessary condition for efficiency, so I’d first equalise prices at the margin and then put that price at the Pigou level. The reverse order is very costly.

On your second and third point, I clearly argued from the perspective of an Irish decision maker, who will have to work within their own jurisdiction given the international accounting rules.

But of course I didn’t write that. Maybe you’re desperate for “silly” biofuels enthusiasts to disagree with you so you can argue with them, with the result that you’re misreading comments.

In your initial intervention, you seem to want to use biofuels to repair errors in targets and accounting standards. That is silly. Biofuels should be used within the agreed framework of targets and accounting. Other instruments should be used to fix targets and accounting.

I assumed that when an economist referred to appropriately incentivising something, you meant incentivising the appropriate level of use. If you meant something else you might explain? You will appreciate that ‘appropriately incentivising an inappropriate level of biofuel use’ is a concept the meaning of which is likely to prove elusive for some readers.

I’m sure you appreciate that legal definitions of emissions (which are after all the product of political negotiations) are not our best understanding of what effects climate. Scientific definitions represent our best understanding of what matters. I assumed because of your correct concern for deforestation from displaced production that you were concerned about impact on the planet. I’m now confused as to what you think. Your tendency towards declarations of what seems to you to be objective reality rather than explanations of what you’re trying to say doesn’t really help discussion.

“If biofuels from sugarcane in Brazil is sold in Ireland but burned in the UK, then the physical uptake of carbon in Brazil is legally placed in Ireland as is the emission in the UK.”

I’m lost as to what you’re trying to say here. Under Kyoto accounting rules Brazil doesn’t have to meet any emission or sequestration targets. Under Kyoto rules biofuel combustion emissions are carbon-neutral no matter where they occur. Any reduction in fossil fuel use in an Annex 1 country is counted. Any displacement to a non-Annex 1 country is disregarded.

“We would be prioritizing the continuity of the food production and food distribution network.”

George Monbiot’s article in yesterday’s Guardian is relevant (and depressing):

http://www.guardian.co.uk/commentisfree/2009/nov/16/oil-running-out-madman-sandwich-board

bjg

It would be interesting as an exercise to figure out what we would do if we had to immediately cut consumption by 40 percent or more, with the prospect of this being a long term issue. What would we prioritize? Really an academic exercise rather than a practical one, but thinking about it highlights how dependent we are on energy and hydrocarbons in particular. (I would say that we would not be prioritizing emergency vehicles, despite the obvious appeal of this idea. We would be prioritizing the continuity of the food production and food distribution network.)

No.No.No.

a) A carbon tax would appropriately incentivise biofuels. The tax may be inappropriate, but that is a different story.

b) A carbon tax applies to legally defined emissions. If biofuels from sugarcane in Brazil is sold in Ireland but burned in the UK, then the physical uptake of carbon in Brazil is legally placed in Ireland as is the emission in the UK.

c) A carbon tax applies to legally defined emissions. The carbon tax appropriately incentivises biofuels within the legal framework. The legal accounting for emissions is inappropriate (rather than the tax or its impact on biofuels).

“A carbon tax would appropriately incentivise biofuels.”
This is only the case if
a) the tax is high enough to achieve the target GHG atmospheric concentration
b) the tax applies globally (or tariffs are applied)
c) the tax applies to all net GHG emissions including land use emissions

This biofuels promotion measure is an addition to a proposed C tax which will not meet any of the above conditions. In fact it will incentivise displacement of C emissions from fossil sources to land use sources. Therefore it will risk increasing GHG concentrations.

http://www.sciencemag.org/cgi/content/abstract/324/5931/1183

I am not saying this is a bad thing or a good thing, just pointing out that energy security is not so much an economic concept as a political one.

Agreed (although I would be more optamistic about targets being met).

Our biofuels target is likely between 6-7% for 2020 which is not a big deal.

Some of that may come from second-gen.

Considering that in transport we are 98ish % dependent on imported fossil the last time I looked, I think this is reasonable.

http://www.ukerc.ac.uk/support/Global%20Oil%20Depletion

Sure. ExxonMobil knows that they will run out of conventional oil one day, and they have every intention of continuing to be the largest private company in the world. That’s why they put up 100s of millions per year for R&D — the cooperation with SG is just one of their programmes.

Irish researchers will be involved if and only if they are world class on the Exxon Mobil scale of world class (rather than on the SFI scale of world class). It’s a good test of the true standing of our biotechnologists and assorted scientists.

In July last Exxon Mobil announced a $600m research programme partnership with Synthetic Genomics to develop next generation biofuels from photosynthetic algae. That’s $120m per annum for the next five years with the world’s leading scientists in this area on board. I assume that what you mean by biofuel R&D here is some complementary offshoots to what the big players are engaged in, since we have only a tiny fraction of the resources available to them to devote to research projects?

This is one of the reason why I argue that it would be better to go slow on biofuel use (and work hard on biofuel R&D).

What is the fixation on transport? I would think modern educated people would look at a country, say Ireland, and think how many Joules, BTUs, Watts or whatever unit you like are being consumed in total. Then if you buy into the bio fuels argument you can figure out ways to increase the proportion of energy consumed in the form of bio fuels.

Perhaps transport is the least appropriate use of bio fuel, as opposed to home heating or electricity production. Maybe the best use of plant matter is as insulation for years, as opposed to burning it once. Or perhaps the best use of food is eating it? I’ve tried that myself on many occasions, it’s quite good prepared properly.

Last year there were food riots in Morocco, Mexico, Mauritania, Senegal and Uzbekistan and Yemen among other countries. Jean Ziegler, Special UN Rapporteur for the Right to Food, called for a 5 year moratorium on biofuel production and I’m inclined to agree. A moratorium on research in the field would also serve to protect the interests of the worlds most vulnerable citizens.

Chances are that we’ll make neither the 40% renewable power nor the 10% electric cars.

Yes! You are 100% right.

The EU realised this when negotiating the cc and energy package and please note:

the EU/Ireland’s 2020 target refers to “renewables in transport” not biofuels as richard erroneously claims above.

The EU’s target is technologically agnostic, though a significant proportion will very likely come from biofuels it is true…

Would that be pea-green, bottle-green or emerald?

One might say you are ‘green’ with envy. Perhaps that one is worth a call for tender somewhere?

“Smelling money” indeed! The question is, whose money? All you need to do these days is mention ‘climate change’, ‘green technology’ and the ‘future of our children’s children’ in the same breath and the coffers magically open. Always knew I was in the wrong business….

A question: are we trapped by a flawed EU policy?

The EU targets on biofuels were devised some years before the food-biofuels problem came into focus, attracting much international publicity and analysis and soul searching among environmental NGOs about a strategy they had previously supported so passionately. Apart from a few wish-list additions about ensuring that imported biofuels are derived from ‘sustainable’ sources – which can mean anything you want it to mean, as pointed out in your analysis - the EU strategy remains unchanged. Worth noting too that originally, our own government target for biofuels penetration was meant to be 5.75% by 2010; now pared back to 4%. As the IT tells us, some 80- 90% of this fuel will be imported, most likely from Brazil.

Our national biofuels strategy appears to be something of a glorious failure. The target in 2006 was to achieve 2% biofuels penetration by 2008. To that end, Budget 2006 introduced a five year scheme of targeted excise relief. The renewables research budget was increased, overall, from €7m to €13.2m, as part of the €65m budget package to encourage biofuels production, CHPs and biomass development. Granted, most of the research funding increase was for wave –energy projects, but some was specifically directed at biofuels research also. Mary Coughlan, then Minister for Agriculture, claimed that she was actively lobbying at EU level to have the seriously inadequate €45 per hectare grant to farmers for biofuels crop cultivation increased substantially.

They’re stuck with the €45 per hectare subsidy, but the government now supports willow and miscanthus planting up to 50% of the cost per hectare or €1,450, according to last autumn’s public consultation document on the biofuels obligation. VAT rates for seeds and bulbs for biofuels crops were cut from 21% to 13.5% in Budget 2007. A synopsis of the supports etc. and analysis of the problems is contained in the consultation document at
http://www.dcenr.gov.ie/NR/rdonlyres/EC1AD24F-304F-4894-85C1-865715A6DE70/0/BiofuelsObligationScheme.pdf
if other readers may care to look. Pretty depressing reading it makes too!

And after all this subsidising and cross-subsidising, so far as I know, actual biofuels penetration reached 0.5% by 2007, about a quarter of the target for 2008. I also read somewhere that if Ireland was to grow enough biofuel crops to meet the 2020 10% target, it would mean turning over 20% of existing tillage land to their production.

So how realistic is the 4% target for 2010? And, is it not the case that we will likely be importing most, if not all, of the biofuels required to meet committed targets even by 2020?

I guess it makes sense that we have to be in at the beginning, even if current technologies are crude, if we’re going to take advantage of newer technologies for biofuels production when these become available in the middle of the next decade or so. But it seems to me that the case has not been set out very convincingly so far.

I fully agree. With present technologies, the route biomass -> electricity -> transport is better than biomass -> biofuels -> transport.

Right. My point is that policy support for biofuels (be it through subsidies, quotas or whatever) should be viewed critically, given this fact.