Biofuels may turn out to be one of the biggest and most dangerous con tricks of the modern age. Holding out the promise of cutting greenhouse gases and dependence on fossil fuels, biofuels have instead driven up food prices, raked in profits for agribusiness and caused serious environmental damage.
Several recent reports have confirmed what many campaigners have been arguing – that converting food to fuel is a disaster for the world’s poor.
The most damning report, by the World Bank’s top agricultural economist Donald Mitchell, was posted on the Guardian newspaper’s website after allegedly being withheld from publication by the World Bank because its findings were so politically sensitive.
The report concludes that the expansion of biofuel production in the US and European Union (EU) is the biggest single contributor to rising food prices – responsible for around 75 percent of the price increase from January 2002 to February 2008.
This finding contrasts sharply with statements from George Bush and his advisors, who argue that biofuels account for under 3 percent of recent global price rises.
Mitchell’s report points to the large-scale diversion of land from growing crops for food to biofuels.
It details how wheat exporting countries such as Argentina, Canada, and Russia, alongside the EU, together transferred 8.4 million hectares from wheat to rapeseed and sunflower for biofuels in the period from 2002 to 2007.
Global wheat stocks fell by 56 million tonnes over those five years – but the 8.4 million hectares lost to biofuels could have produced 80 million tonnes of wheat in that time.
Biofuels are big business, especially in the US and EU where they are highly profitable and heavily subsidised. In the US, federal subsidies to biofuel producers run at more than $7 billion a year.
Over a third of US maize and about half of the vegetable oil produced in the EU now goes to biofuel production.
Because biofuels are so profitable they have provoked a rush to invest, driving up prices of land and grain.
The biofuel bonanza has added to the recent trend for commodity speculation. Commodoties are seen by those scarred by the credit crunch as a safer investment than finance or property.
Biofuels are made from plants and are therefore a renewable source of energy. They have been touted as a green alternative to fossil fuels.
They do sound like a great idea.Instead of pumping out every last drop of the earth’s oil and burning it at huge financial and environmental cost, why not shift to making fuels from vegetation that can simply be harvested and then replanted?
But the reality is very different.
Nobel prize-winning scientist Paul Crutzen has pointed out that the use of nitrogen fertilisers in the large-scale farming of biofuels generates nitrous oxide – a greenhouse gas 300 times more damaging than the carbon dioxide from burning fossil fuels.
Crutzen calculates that production of ethanol from maize or rapeseed oil (which accounts for more than 80 percent of biofuels) is up to 1.7 times more harmful to the environment than fossil fuels.
This is even before the questions of land and water resources are taken into account.
The drive to find more land for biofuels is causing rapid and widescale destruction of natural forest in Brazil and elsewhere, as well as land clearance and the draining of peat bogs in countries such as Indonesia.
Politicians can no longer pretend that their support for biofuels has anything to do with concern for the environment.
Their commitment to biofuels is connected to their support of the drive to maximise profits and to geopolitical issues around oil prices and supply.
George Bush – hardly the most eco-friendly world leader – is a keen backer of biofuels. In 2005 he signed up to a new energy plan that set out to triple biofuel production in the US.
A year later he made the reason for this clear. He argued that by 2025 some 75 percent of oil imports from the Middle East should be replaced by renewable energies – in other words, biofuels.
The president’s brother Jeb Bush is head of the Inter-America Ethanol Commission, a body formed in 2005 to promote the biofuels industry.
Jeb Bush argues that a shift to biofuels can help the US to reduce fuel dependency on “unstable sources controlled by enemies of our country”.
Gordon Brown has also been a keen supporter of biofuels.
Despite the evidence of the damage biofuels are doing, as well as warnings from the government’s chief scientist and a recent government-commissioned report, ministers have only conceded that they should proceed with caution.
Action is desperately needed over both food prices and the environment, but biofuels are an example of how solutions driven by the market make the problem worse, not better.
And they show yet again that we cannot trust the world’s leaders to address the urgent problems we face.