Biomedical Engineering Reference
In-Depth Information
biodiesel, and biogas. Biofuels belong to the most rapidly growing renewable
energy technologies and are the main focus of this chapter [
1
,
2
].
1
There has been a tremendous increase in the production of transportation fuels
derived from biomass (i.e., biofuels) in recent years. World biofuel production
increased from almost a zero level in 1970 to 29 billion gallons in 2011 [
3
]. The
biggest players in the world biofuel market are the United States, the European Union,
and Brazil, accounting for around 90 % of global biofuel production. These three
regions practically dominate the sector and determine the development in world
biofuel markets.
The rapid growth of the biofuel industry would not have been possible without
government intervention. Biofuel policies are widely implemented in most devel-
oped and many developing countries. The International Energy Agency (IEA) [
2
]
estimates that in 2009 the combined government support in Brazil, the European
Union, the United States, and other countries totaled $20 billion. Governments use
many different policy instruments which from an international trade perspective
either do or do not discriminate against international trade. The first category
includes consumption subsidies (tax credits or tax exemptions) and mandates,
while the second group consists of policies such as import tariffs and quotas,
production subsidies (for biofuels and feedstocks), and sustainability standards
[
4
]. However, by far most commonly applied instruments are biofuel mandates
and consumption subsidies.
There are several seemingly plausible reasons why biofuels are supported by
governments.
2
First, biofuels reduce the dependency on imports of crude oil [
1
,
6
-
9
]. There are concerns that because of limited oil reserves the cost of oil extractionwill
increase in the future, leading to high relative oil prices. Furthermore, oil price
instability stemming from, for example, regional conflicts and political turmoil in
the Middle East and other oil-producing regions, has negative consequences for the
world economy. Second, increased production of biofuels is expected to improve the
environment by reducing the reliance on conventional sources of fuels, thus contrib-
uting to the reduction in global greenhouse gas emissions [
1
,
6
-
8
]. Finally, biofuel
support might reduce the cost of agricultural support programs. The biofuel produc-
tion stimulates higher agricultural prices, thus leading to higher incomes of farmers
and contributing to economic growth in rural areas [
1
,
8
]. This interlinkage between
biofuel and agricultural markets could possibly allow governments to partially sub-
stitute the farm support with the provision of support to the biofuel industry.
1
The International Energy Agency (IEA) differentiates between “conventional” and “advanced”
biofuels. The distinction is based on the maturity of a technology. Conventional biofuel technol-
ogies include well-established technologies that are already producing biofuels on a commercial
scale. These biofuels are commonly referred to as first-generation biofuels. Typical biomass used
for first-generation biofuels includes sugarcane, sugar beets, corn, wheat, rapeseed, soybean, or
palm oil. Advanced biofuel technologies are conversion technologies that are still in the research
and development, pilot, or demonstration phase, commonly referred to as second- or third-
generation technologies. These biofuels are made from lignocellulosic biomass, woody crops,
agricultural residues, or waste [
2
].
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