Biofuels: Green or Not?

Though biofuels have been touted as a viable substitute for fossil fuels, a recent report from the Organisation of Economic Co-operation and Development (OECD) has advocated energy efficiency and conversation measures rather than biofuels as a viable solution to fossil fuels.

Biofuels have been generating controversy recently. Earlier this year they were cited as one of the causes of increase in food prices around the world. It was estimated that larger amounts of agricultural lands are getting diverted to the cultivation of corn for use in biofuels rather than food. Moreover, the greenhouse gas emissions reduction benefits of biofuels have also come under increasing attack in the past few months as scientists debate the true environmental costs of producing biofuels. While it was earlier believed that biofuels have lesser greenhouse gas emissions than fossil fuels, the bigger picture (according to some studies) shows that the production of biofuels has a greater greenhouse cost because of the conversion of virgin land, forested land and even scrubland into cropland for biofuels. Furthermore the related refining and transportation costs of biofuel also increase their greenhouse effect.

The recent report from the OECD raises the same concerns on the greenhouse compatibility of biofuels. It will be interesting to see where the future of biofuels is headed. As oil-prices rise, there is heightened interest in alternatives and much hope has been banked on biofuels. But with the new doubts about the eco-friendliness of biofuels, it is unclear how big a role biofuels will play in solving the energy conundrum.

India's CDM status till date

At 345 registered projects, India currently has the highest number of registered CDM projects (according to the CDM pipeline data for July 2008). But the total number of CERs generated by these projects is less than half of China's 221 registered projects. Moreover India currently only has 576 projects in the validation stage which will generate 1,75,442 kCERs, while China has 943 projects with a potential of 7,16,338 kCERs.

Thus, though India has the highest number of registered projects and the second highest number of projects at validation stage in the CDM pipeline, it is lagging significantly behind China in terms of the CERs generated. With its high numbers, China is currently ruling the carbon market and is supplying more than 50 per cent of the total volume.

Interestingly, if one only looks at the small scale CDM market, then India has the highest share and is ahead of China. India is supplying around 32 per cent of the CERs in the small scale CDM market, while China is supplying around 23 per cent. India should focus on its small scale sector and further build its expertise in this market. Indeed, small scale projects are more than 60 per cent of India's total CDM projects. And now the IPCC has started a new CDM category – Programme of Activities (POA) – wherein one only needs to register once for any number of projects which use the same baseline and monitoring methodology. This category will be especially useful for small scale projects as it cuts down costs while at the same time enabling a project developer to apply his small scale activity in multiple locations.

G8 Leaders Pledge To Reduce Greenhouse Gas Emissions

The G8 members – Russia etc – pledged to cut down their emissions of greenhouse gases by 50 per cent by 2050, at the recently concluded G8 summit in Toyako in northern Japan. While this commitment is applause-worthy, it has come under criticism as it is vague (for example, it does not state whether the emissions will be cut down 50 per cent from the 2000 levels or the 1990 levels) and unclear about the roadmap for cutting emissions by 2050. Moreover, the G8 leaders did not announce any short term goals or numerical targets for reducing emissions in the coming years. Without these targets, it is uncertain how the G8 will achieve any significant emissions reductions.

The major development at the Summit however was the participation of USA in the climate change talks. This is the first time that President Bush has publicly supported cuts on emissions of greenhouse gases. With even President Bush, who has been a long-time opponent of reducing emissions, agreeing on cuts, it is obvious that the next President of America will promulgate serious laws on tackling climate change both domestically and internationally.

The other main development was that developing countries such as China and India agreed to take emissions-caps in the long term, a stance that they have been resisting as climate change has been caused substantially by the developed world who should take the onus for mitigation.

With these two main developments, the stage is now set for the next round of climate change negotiations which will be held in Poznan, Poland, in December this year,.

India launches National Action Plan on Climate Change

Earlier this week, the Indian government released its action plan for fighting climate change. The plan focuses on technological solutions rather than mandating emissions caps. India's per capita emissions continue to remain low, especially in comparison to per capita emissions of the industrialized world. India is thus focusing on harnessing technology to mitigate effects of climate change instead of issuing obligatory national carbon emissions caps. India has however categorically stated that her per capita emissions will at no point be allowed to exceed the per capita emissions of developed countries.

The plan has been prepared under the guidance and direction of the Prime Minister's Council on Climate Change. The action plan emphasizes on energy efficiency and cleaner technology and includes eight national missions on solar energy, enhancing energy efficiency, sustainable habitat, water conservation, for sustaining the Himalayan ecosystem, creating a "Green India", sustainable agriculture, and establishing a strategic knowledge platform for climate change.

The action plan is also expected to launch a domestic market in energy trading. The plan mandates energy benchmarks for each industrial sector and allows trade in energy saving certificates. Thus, it aims to create a market-based mechanism that will encourage energy saving and efficiency by allowing energy-conservative industries to earn profits by selling their energy certificates to energy-inefficient industries. This market based system might well be the driving force behind energy reform in the Indian industrial sector.