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Money Programme

Get the facts behind the big business and finance stories from around the world – and down your street, in The Money Programme.

They’re seen as an environmental threat, accelerating rain forest clearance for palm oil production and pushing people into starvation as lucrative biofuel plantations replace much needed food crops.

The problem isn’t so much with biofuels themselves, but more about politicians desperately seeking an easy, quick solution to the climate change problem. Biofuels seem to offer such a quick, easy win: within two years, the UK government intends biofuels to make up 5% of petrol and diesel used, and the EU announced last month plans for 10% of all Europe’s energy to come from plants by 2020.

There are some biofuel quick wins. In a number of cities, waste cooking oil is collected from restaurants and processed into fuel. That’s great, but quantities are relatively small. Some biofuels have been around for a long time (e.g. Brazil has produced ethanol from sugar cane for decades). But there are good and bad biofuels. Researchers have known for years that there are energy efficient ways to produce biofuels and other ways that are awful. Biofuel from maize uses as much energy in growing and processing as comes out at the end. The USA’s use of ethanol from maize is more an excuse to subsidise farmers than anything about the environment.

The sort of biofuels around now that can provide big volumes of fuel tend to be the less efficient ones, or use tropical nuts, leading to issues of rainforest clearance and food crop displacement. Diesel from rapeseed comes out quite well, but it is the so-called ‘second generation’ biofuels that use the whole plant which are most energy efficient. These include plants like grasses and wood, but such technologies are only just coming on stream.

For the UK, biofuel from wood offers a real win-win. We have put a lot of land into set-aside and are planting it with trees. Using such areas to produce coppiced wood for biofuel would not take land from food production or impact on developing nations. But this is a medium-long term response and will only build up production slowly. The Energy Research Centre’s 2007 report on carbon abatement in transport summed this up:

“Biofuels can occupy a segment of the UK fuel market but care must be taken not to expand demand too quickly, before crop breakthroughs and robust environmental safeguards are in place.”

Biofuels can be an energy hero, but not if the politicians blunder in and develop them inappropriately, trying to find a quick and easy way out of their climate change indecisiveness. Biofuels can play a role, but we need other tough environmental policies as well. Using biofuels as a smokescreen was bound to backfire. The real danger is that we’ll reject biofuels entirely because of such ineptitudes.

Weblinks

• How green is your journey?
• Calling companies to account
• Watch the trailer
• Join the discussion
• An Introduction to Sustainable Energy
• An Agricultural Crime Against Humanity
• UK Energy Research Centre
• Quick Guide to biofuels

Courses

• Energy for a Sustainable Future
• Working with our environment: technology for a sustainable future

About the author

Stephen Potter is Professor of Transport Strategy at the Open University. His research includes work on the diffusion of cleaner transport technologies and the development of sustainable transport policies.

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Blogging about

Money Programme

Get the facts behind the big business and finance stories from around the world – and down your street, in The Money Programme.

With transatlantic air travel set to boom as the Open Skies policy sweeps away old restrictive practices, it seems that nothing stands in the way of our enjoying an ever increasing globe trotting lifestyle. Rising oil prices and climate change seem mere side issues, but are now moving towards aviation’s centre stage.

Until recently aviation has neatly sidestepped the environmental debate. Its CO₂ emissions were excluded from the Kyoto agreement, international agreements banned taxing fuel, and aviation’s emissions were small compared to other sectors. But now the sheer growth in air travel has brought aviation into the environmental spotlight. Aviation is the fastest growing source of CO₂ emissions, having doubled since 1990 and expected to double again by 2020.

"the sheer growth in air travel has brought aviation into the environmental spotlight"

Aviation can no longer be ignored by national and international policymakers, so a pretty big political battle is in the offing that could well change the economics and role of air travel in our lives.

To date environmental actions have been limited. Because international air travel treaties ban fuel tax on international flights, the only real price measure has been on passenger departures (e.g. the UK’s Air Passenger Duty, varying from £10-£80). From 2009 this will shift to a tax on the operator, which'll be passed on in fares.

Of more significance are the European Commission plans for aviation to join the EU carbon trading programme from 2012. Carbon trading is a major plank in the EU’s strategy to control CO₂ emissions. Major energy users are given a CO₂ quota. If they emit more they have to buy permits, or can sell surplus permits to others. Total emissions are capped and then cut back over time.

The EU proposal is for aviation to be capped at its average emissions for 2004-2006. If an airline wishes to exceed its quota, it'd need to purchase carbon permits from any other sector with a surplus. So, if airlines expand their services, as is anticipated, they'll have a major new cost to pass on in fares.

More speculatively, ideas are emerging for personal carbon trading, whereby individuals would be allocated an annual carbon allowance, which would probably allow for only about 1,000 air miles per year. This may sound draconian, and may never happen, but what is now becoming clear that, like it or not, we're going to be forced to face up to the carbon reality of air travel.

Weblinks

•  
• Open Skies - will the consumer benefit? - The Money Programme investigates
• Big business goes green - watch two high-profile business leaders explain their plans
• Calling companies to account - as companies fight for supremacy, how do we make sure they play by the rules?
• What shall we tell the children? - when it comes to climate change, politicians and the media have treated us like kids. Discover what they’re not saying.
• Join the discussion - how do we curb carbon emmissions from aircraft?
• EU cap on air emissions from 2012 - from BBC News

Courses

• Why sustainable energy matters - free course material from OpenLearn
• Energy for a sustainable future
• Working with our environment: technology for a sustainable future

About the author

Stephen Potter is Professor of Transport Strategy at the Open University. His research includes work on the diffusion of cleaner transport technologies and the development of sustainable transport policies.

Subscribe to Stephen Potter's posts

 

Blogging about

Money Programme

Get the facts behind the big business and finance stories from around the world – and down your street, in The Money Programme.

The idea of green marketing is that there is a sizeable market segment of green consumers who are willing to pay a little more for environmentally friendly products from environmentally friendly companies. Producers and retailers will react to this green demand and environmentally friendly practices will be pushed through the supply chain. So far so good, and actually rather familiar. Green marketing dates back several decades now, with specialist manufacturers and retailers such as Patagonia, Ben and Jerry’s, the Body Shop and so forth, leading the way.

But there are problems with this nice idea of greening the world through marketing. And that’s not even so much that companies do it in order to increase sales or profits. Of course they do. They are not charities, after all. And if it really delivered the environmental goods, why would it matter? The programme already lists quite a few problems with the various environmental targets and actions described by retailers.

It’s all a bit much for the average consumer

No, the biggest problem is that expecting consumer demand to drive a green revolution may not work. There is no doubt a (small) segment of dedicated green consumers who will go to significant lengths in order to inform themselves about the environmental footprint of their consumption and to reduce this as much as possible. But how many consumers will really be able to interpret carbon footprints on product information, even if Tesco’s actually manage to calculate these with any degree of accuracy? And that is only one environmental issue to worry about. In addition there are things like packaging, organic production, sustainable resource use, and so on and so forth. It’s all a bit much for the average consumer even to get interested in, never mind knowledgeable about.

And, if taken to natural conclusions, green consumption would surely require some sacrifices, i.e. no strawberries in winter, less cod and many more. Can we really expect millions of individuals to make these decisions for themselves so that the green demand then can trickle through the supply chain? More likely it would at least require some concerted action from consumers, government and industry to start tackling the problem. Market forces alone may not solve it.

Further reading

• Take if further - learn more about green marketing and other ethical issues in business with an Open University course
• Video: big business goes green - watch the leaders of Tesco and M&S explain their plans
• How green is your High Street? - giants of the high street are spending millions going green, but what are their motives? The Money Programme investigates.
• Does it cost too much to be green? - neither hybrid cars nor organic food come cheap

About the author

Anja Schaefer is a Lecturer in Management at the Open University Business School. She’s been lecturing in marketing and corporate social responsibility for eight years. Anja has published material on consumer behaviour, sustainable consumption and corporate environmental management.

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