COMMITTEE ON AGRICULTURE
Rome, 13-16 April 2005
Item 7 of the Provisional Agenda
1. Clean and safe energy services are essential for achieving the United Nations Millennium Development Goals. However, around two billion people, mostly living in rural areas of developing countries, are still without electricity or other modern energy services and rely largely on burning fuelwood and charcoal to meet their basic cooking and heating needs. At the international level, petroleum-based fuels are the other dominant energy source. While these have allowed for industrial development, they are also the cause of many of the environmental concerns of our modern society.
2. Besides providing an important option for world energy, the production and use of biofuels are linked to a host of issues, such as crop management and cropping systems, food security, land use and rural development, sustainable forest management, biodiversity conservation, and mitigation of climate change. Increased utilization of biofuels, if properly managed, can help to provide cleaner energy services while contributing to sustainable development and the alleviation of environmental concerns.
3. Although the economic competitiveness of biofuels versus fossil fuels is a major challenge, there are many other problems, covering a wide range of institutional aspects and technological issues, which deserve the priority attention of FAO.
4. For discussion, the term “bioenergy” refers to the conversion of biomass for energy, including wood energy derived from trees and agro energy derived from non-wood agricultural crops. This paper explores advantages and opportunities for increased utilization of bioenergy, which can contribute, among other things, to the diversification of agricultural and forestry activities, and the improvement of food security and poverty alleviation. Views are sought on the contribution that FAO and other organizations could make towards promoting changes in the agricultural and forestry sectors through the integration of bioenergy activities within present farming and timber production systems.
5. Petroleum is the dominant primary energy source, accounting for over 35 percent of the world’s total commercial primary energy consumption. Coal ranks second as a primary energy source (~23 percent of world primary energy consumption) and natural gas third (~21 percent). These fossil fuels emissions are the main sources of the greenhouse gases causing global warming, and thus climate change. Fuelwood and charcoal together with other biofuels represent around 10 percent of the total global primary energy consumption. Nuclear energy accounts for 7.6 percent, and hydro and other renewable energy sources (geothermal, solar and wind) 2.7 and 0.7 percent, respectively.
6. Four out of five people without electricity live in rural areas in developing countries, mainly in South Asia and sub-Saharan Africa. In rural sub-Saharan Africa, women carry on average 20 kg of fuelwood five kilometres every day. In sub-Saharan Africa, more than 92 percent of the rural population is without electricity. The number of people living with less than US$1/day is about the same as the number of those lacking access to commercial energy: two billion people. Extending an electric grid to a few households in a rural setting can result in costs of up to $0.70 per kilowatt-hour, seven times the cost of providing electricity in an urban area.
7. In this context, an increased proportion of bioenergy1 with its two main components: wood energy and agro-energy2, can help to provide a cleaner energy service to meet the above-mentioned energy requirements.
8. This century could see a significant switch from a fossil fuel to a bioenergy-based economy, with agriculture and forestry as the leading sources of biomass for biofuels such as fuelwood, charcoal, wood pellets, bioethanol, biodiesel and bioelectricity.
9. In developing countries, fuelwood and charcoal remain the dominant energy source for most households. However, also in developed countries such as Finland, Sweden, Austria and Australia, wood energy is becoming an increasingly important industrial energy option as it is locally available and environmentally friendly. Forest enterprises in these countries are expanding their conventional timber production activities to include these new energy market opportunities. Wood energy is derived not only from woody residues but also from woodfuels produced as a primary product through reforestation and afforestation.
10. Liquid biofuels have gained importance in the last decades in Brazil and more recently in Europe, the USA, Japan and other OECD countries, particularly in the transport sector. At the same time, the role of agriculture as a source of energy resources is gaining in importance. Scenarios developed for the USA and the EU indicate that short-term targets of up to a 13 percent displacement of petroleum-based fuels with liquid biofuels (bioethanol and biodiesel) appear feasible on available cropland. In fact, a number of agro-industries, such as sugar mills, already convert bagasse into process heat and electricity, thus becoming energy self-sufficient. Some of them are also ethanol producers and electricity providers to the grid. The bioenergy potential of agroindustries processing bananas, rice, wheat, sorghum, cassava and many other crops is considerable. Technologies for producing synthetic fuels from biomass and their applications in fuel cells are triggering interest in the use of energy crops as rotating crops in highly intensive agriculture, with starches and other forms of carbohydrates being the base for bio-alcohol or biodiesel production in place of simpler processes based on sugars.
11. There is growing interest on the part of governments and the private sector in developed countries and in many developing countries, in expanding the use of biofuels derived from agricultural and forestry biomass.
12. Biomass is a locally available energy source that can produce electricity, heat and power, based on liquid, gas or solid derived fuels, which can contribute to the substitution of imported fossil fuels, thus enhancing national energy security as well as the diversification of energy sources.
13. As a carbon-neutral source of energy, biofuels can also contribute to climate change mitigation through substituting fossil fuels, when sustainably produced, and through carbon sequestration in forest and soils through afforestation and reforestation activities and improved land and forest management practices. Nevertheless, the ability of bioenergy to reduce green house gas emissions varies depending on the forms of biomass utilization. In some instances, bioenergy generation may even prove negative in net energy value.
14. The utilization of untapped residues and the establishment of energy plantations and energy crops can address other existing environmental concerns. Energy plantations and crops (in particular perennial crops) can help to prevent soil erosion by providing a cover which reduces rainfall impact and sediment transport. Annual energy crops can also allow diversification and expansion of crop rotations. Deforested, degraded and marginal land could be rehabilitated as bioenergy plantations which could combat desertification and increase food production. With increased utilization of biomass for energy production, crop residues will have an economic value. However, sufficient amounts of crop residues must also be left on the soil to assure its protection and sustainability of the land use. The amount to be left will depend on the climatic conditions and the specific crop rotations. In addition, it is important to avoid possible negative environmental impacts associated with the expanded utilization of biomass for energy, such as excessive extraction of fuelwood, or the establishment of large-scale monocultures.
15. Increasing the use of biomass for energy could also lead to improved economic development and poverty alleviation, especially in rural areas, since it attracts investment in new business opportunities for small- and medium-sized enterprises in the fields of biofuel production, preparation, transportation, trade and use, and generates incomes (and jobs) for the people living in and around these areas. In fact, bioelectricity production has the highest employment-creation potential among renewable energy options, since it can create several times the number of direct jobs than the production of electricity using conventional energy sources, and with lower investment cost per job generated.
16. In many countries, biofuels can be produced in large quantities when they are derived from forest and mill residues as well as agricultural crops and processing wastes from agro-industries. Despite this, decreasing the price difference between fossil fuels and biofuels remains a major general constraint when these prices are based on direct cost analysis, even when the recent volatility in international oil prices is making bioenergy (and raw materials produced from biomass) more attractive. However, the collateral benefits of bioenergy mentioned above, if properly internalized, can offset the price difference with fossil fuels. The Clean Development Mechanism (CDM) of the Kyoto Protocol could offer, for example, additional incentives for establishing energy plantations and opportunities for technology transfer.
17. Research and development work should lead to reduced production costs, higher energy conversion efficiency and greater cost-effectiveness of bioenergy. For instance, research may provide new opportunities to utilize a wider range of lignocellulosic biomass from timber mills, agro-industries and urban waste, as well as traditional agricultural and forest residues. Innovation in bioenergy technology is of particular interest to developing countries, since it would allow them to bypass some of the problems of fossil fuels dependency experienced by most industrialized countries. The rapid advance in technological choices could give developing countries the chance to use and commercialize new technologies relatively quickly, provided there are appropriate policies, a strong commercial incentive and a sustained market for them.
18. Bioenergy systems are relatively complex, interdisciplinary, intersectoral and site- specific. Therefore, solving problems is challenging and requires the integration of biofuel production into conventional agricultural and forestry activities as well as the synergic contribution of various institutions from the agriculture, forestry, energy, industry and environmental sectors.
19. Throughout the past decades, bioenergy and other renewable energies have been the subject of several international declarations and commitments on sustainable development:
20. FAO has over 20 years experience in various bioenergy fields with activities mainly focused on fuelwood (and other wood energy forms) and on agro-energy resources, including work of a normative nature under its Regular Programme and, in a number of countries, direct assistance through the Field Programme. Inter-departmental cooperation has been instrumental in guiding and implementing these activities. In the field of bioenergy, special attention has been paid to the following four main lines of action:
Generation and dissemination of information on bioenergy production, trade and utilization through:
Technical assistance to member countries:
21. Projects formulated and advisory services provided to countries at both national and local levels for the design and implementation of bioenergy policies, strategies, programmes and projects involving agroindustries and rural energy.
Assessment of funding and finance mechanisms for bioenergy development:
22. Proposals to improve eligibility of agricultural and bioenergy activities for funding under the Clean Development Mechanism (CDM) of the Kyoto Protocol (KP) have been made to the UNFCCC Secretariat. A guidebook to improve understanding of the opportunities for agricultural activities under the KP is currently under preparation.
Cooperation with national, regional and international partners:
23. FAO partners with several inter-governmental organizations, such as the International Energy Agency, the World Bank, the Latin American Energy Organization, the African Development Bank, the Economic Commissions for Africa, Asia and the Pacific and Latin America and the Caribbean, the World Energy Council and the Inter-American Development Bank. Collaboration has been developed with GEF to promote competitiveness and efficient use of bioenergy in small and medium agro-industries. Collaboration with research and development centres and universities includes Itajuba (Brazil), Utrecht (The Netherlands), Shenyang (China), San Carlos (The Philippines), UNAM (Mexico) and Imperial College (UK). Collaboration has also been established with UN organizations such as UNDESA, UNDP, UNEP, UNESCO, UNIDO and others, in the context of WSSD preparations and, more recently, in the establishment of UN Energy as the interagency mechanism reporting to CSD, of which FAO holds the Vice-chairmanship.
24. FAO’s comparative advantage on bioenergy stems from its role as the lead UN agency for both forestry and agriculture, with a mandate to:
25. Three major areas can be identified which require particular attention in order to mobilize the full potential of bioenergy: policies and institutions; capacities; and technical and economic issues. Listed below are the main factors in each of these areas which constrain effective development in the sector, both at global and national levels.
26. Policies and institutions:
28. Technical and economic issues:
29. For practical purposes, FAO intends to continue work on the two main components of bioenergy: wood energy and agro-energy. The Forestry Department will continue to take the lead on wood energy and the Sustainable Development Department on agro-energy. Particular efforts will be made to mobilize the considerable multidisciplinary expertise within these two departments as well as in the Agriculture, Economic and Social, and Technical Cooperation Departments. Whilst FAO has carried out a large number of bioenergy activities to date, it is suggested that the bioenergy topic be given a more integrated focus and higher visibility. There is also a need to strengthen inter-disciplinary approaches that promote synergies between the two components. Areas of work with potential for improved collaboration include:
30. Options for strengthening multi-disciplinary collaboration include:
- institutionalizing a multi-disciplinary approach to bioenergy, for example by establishing an Inter-Departmental Working Group (IDWG) on Bioenergy; and/or
- elevating the profile of bioenergy, for example by establishing a Priority Area for Interdisciplinary Action (PAIA) on Bioenergy.
31. The guidance of the Committee on Forestry and of the Committee on Agriculture is sought on the future direction of FAO’s work in these areas, including the desirability to:
- promote the bioenergy implications to successfully achieve the Millennium Development Goals;
- consider if the relative priority given to this programme within FAO is appropriate;
- consider the options outlined in section VII of this paper and select those which would better reflect the mandate and comparative advantage of FAO in the bioenergy field and which would promote a more integrated approach to bioenergy within the Organization;
- encourage an intensified field programme to provide policy and technical advice to member countries on the subject, possibly through increased extra-budgetary resources; and
- strengthen activities for: a) realization of improved bioenergy information systems, b) preparation of outlook studies, c) analysis of technical, economic, social and environmental aspects of the use of biomass and the implications of different land-use types, and d) Clean Development Mechanism afforestation-reforestation-bioenergy projects in the context of sustainable development.
1 . Bioenergy: all energy produced from biofuels. Biofuel: fuel produced directly or indirectly from biomass. Biomass: material of biological origin (excluding material embedded in geological formations and transformed to fossil), such as: fuelwood, charcoal, agricultural wastes and by-products, energy crops, livestock manure, biogas, biohydrogen, bioalcohol, microbial biomass, and others. Bioenergy includes all wood energy and all agro-energy resources.
2 . Agro-energy resources are agricultural and livestock by-products (such as straw, leaves, stalks, husks, shells, manure, droppings and other food and agricultural processing and slaughter by-products) and energy crops (plants purposely grown for energy), such as sugar cane, sugar beet, sweet sorghum, palm oil, rapeseed and other oil seeds, and different kinds of grasses, such as miscanthus (Miscanthus giganteus), switchgrass (Panicum virgatum) and reed canary grass (Phalaris arundinacea). Wood energy resources are fuelwood, charcoal, forestry residues, black liquor and any other energy derived from trees.