Environmental Engineering Reference
In-Depth Information
8.4.1
Integrated Development
The wide range of sectors and technologies involved in the development of a
biobased economy and the myriad of different possible drivers means that a broad
range of policy domains are impacted. Policy solutions in the bioeconomy sector
derived in response to identified needs commonly involve working across
traditional government policy groupings and departments working in agriculture,
environment and energy and those dealing with business, innovation and educa-
tion. This does not always run smoothly, for example when there are tensions over
how land should be most productively utilised.
This necessary development of integrated working within governments also
mirrors what is happening in the commercial sector, where traditionally fossil-
focused chemical companies in the sector have developed partnerships with
agricultural commodity suppliers and biotechnology companies to take forward
commercial development and demonstration projects. Current examples of such
partnerships include: BP, AB Sugar and DuPont established a joint venture to
develop first-generation bioethanol production through Vivergo fuels; US biotech
company Amyris joined with the French oil giant Total to form Total Amyris
Biosolutions, a 50-50 joint venture that will produce and market renewable
biodiesel and bio jet fuel; and DSM (chemicals and healthcare) and Roquette
(a leading starch manufacturer) have formed a joint venture to develop the market
for biobased succinic acid.
In cases where technologies are well developed and proven, then policies may
only require measures to open up suitable market opportunities, addressing the
so-called 'demand side'. Where technologies are less well developed, stimulation
of development and demonstration may be required to encourage industry uptake
and de-risk private investment, addressing issues of 'supply side'. Typically, a mix
of both supply-side and demand-side measures are required.
Ideally, any policy should work in tandem with existing market structures and
operators to reduce development costs. But why are policies required at all?
This is summarised simply by Londo and Meeusen [3] who identified that the
development of a biobased economy will require support for a significant period
for two main reasons. First, new technologies need to be developed that will
initially be more expensive than their conventional counterparts that have had
decades to be refined and developed, making them as cost efficient as possible. It
is expected that the new biobased options would follow a similar technology cost
reduction pathway in the medium to long term, reducing the need for public
support. Second, some biobased technologies will not become competitive as
their wider social benefits and the real external costs reflecting the environmental
impacts of their fossil-derived competitors are not recognised in their current
market value. In the latter case, additional support measures are required.
Governments commonly rely on estimates of the Social Cost of Carbon (cost
per tonne of CO
2
emitted) which represents the anticipated costs of dealing with
