Sustainability Science Program

Overview

Biofuels and Globalization

Overview

The Biofuels and Globalization Initiative examines the trade, economic development and environmental policy dimensions of a global biofuel industry. Specifically it looks at the potential for the development of a biofuel industry in poorer developing countries and the challenges that must be met in order to realize this potential. These challenges include pressure on food prices, loss of biodiversity, net carbon emissions over the entire production process and the absence of public infrastructure service, such as roads and ports. To inform our work, the Initiative held three high-level workshops with experts from industry, government and academia. The first, in May 2007, identified the most important research questions in trade, economic development, and environmental policy; the second (2008) focused on the potential and obstacles to developing a robust biofuel industry in the developing world; and the third (2009) dealt with the efficacy of certification standards being developed in Europe and the United States. Our research had substantial influence on academic and government research priorities. Much of Brazil's current policy research on this topic draws on our work. European countries have moved in the direction of our recommendations on certification. Our recent attention has been on biofuel development in the developing world.

Outreach and Impact

To inform our work, the Initiative held three high-level workshops with experts from industry, government and academia. The first, in May 2007, identified the most important research questions in trade, economic development, and environmental policy; the second (2008) focused on the potential and obstacles to developing a robust biofuel industry in the developing world; and the third (2009) dealt with the efficacy of certification standards being developed in Europe and the United States. We published rapportuers reports synthesizing the discussion and recommendations from all three sessions, which were widely disseminated within and beyond our research network.

Our goal was to inform key decision makers so that they are able to frame the debate over biofuels policy more effectively and to inform the research community so that their focus is on the issues that will shape the policy debate. Further by inviting government and opinion leaders from both developed and developing countries to our workshops, we have attempted to stimulate a dialogue that is often missing in the existing debate that is often characterized by discussions between actors in the developed world, leaving out the voices from the developing nations.

We have worked closely with key U.S. agencies and the Congress. While our arguments are not always embraced, they fill an important void. We are producing a history of transportation biofuels policy in the United States with the expectation that a study of past efforts to promote or require the use of transportation biofuels will inform the current policy discussion.

Key Research Findings

We examined the potential implications of increased biofuel trade on the economies of developing countries particularly those in tropical regions and found that obstacles, such as a lack of needed infrastructure and a growing concern in possible importing countries that the environmental impacts may be too costly, must be addressed if this potential is to be met. This effort was chaired by Professor Ricardo Hausmann. He argues that certification process that cast their net too widely may deter investors from committing funds to biofuel initiatives in developing countries. He suggests several guidelines that should govern certification processes. We published a paper by Haussmann and Rodrigo Wagner on this topic and the potential for biofuel production in developing countries in the developing world in October 2009.

Over the life of the initiative, we conducted country-specific research on the economic, social and political benefits and costs of biofuels developments. We have completed studies in Tanzania, Zambia, Brazil, Dominican Republic, and India. Our most recent study, conducted by Elisa Portale (former Giorgio Ruffolo Fellow), looks at the social and economic sustainability of small-scale jetropha development in three villages in rural Tanzania and makes a strong argument that such initiatives may be more socio-economically viable than previously thought. Our current research includes work on biofuel standards and certification requirements; asking the question, are these standards, along with mandates, succeeding in creating a global, sustainable biofuels market? Georgio Ruffolo Fellow, Annalisa Zezza, is analyzing certification systems in producing and exporting countries, their impact on trade, and the transaction costs and the benefits associated with the standards and requirements.

Professor Robert Lawrence headed a complementary second study examining existing barriers to biofuel production. His work culminated in a paper on the factors that have shaped the rules governing biofuels that are in place today in the United States and Europe that we published in September 2010. This paper is a critique of U.S. and European biofuels policy mandates. Lawrence argues that these mandates do not meet the stated goals of biofuel policies (i.e., reducing greenhouse gas emissions, reducing oil consumption, or increasing rural economic development). The paper makes recommendations for matching goals with policies.

Finally, we have two additional studies on U.S. biofuel policy. The first is an investigation into the Congressional adoption of the 2007 Renewable Fuel Standard, which mandates the production of 16 billion gallons of cellulosic ethanol by 2022, requiring the rapid commercialization of an industry that does not yet exist in the U.S.  We are also producing a book-length history of transportation biofuels policy in the U.S. with the expectation that a study of past efforts to promote or require the use of transportation biofuels will inform the current policy discussion.

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