From Waste to Fuel. (Category- Environment, Resource Economics)

The global thirst and man’s sudden urge for the need to find alternative sources of energy has been on a constant rise.

“No single technology will be the answer; what is needed is an array of technologies aimed at different markets and different ends of the supply/demand equation.”—Dr. Joseph A. Stanislaw

The global thirst and man’s sudden urge for the need to find alternative sources of energy has been on a constant rise. The governments of various countries and energy industries have shifted their primary focus towards searching for alternative energy sources as part of rising energy prices and growing concern for the environment. Be it liquid or solid, in today’s date the world energy scenario is dominated by fossil fuels. Sustainability is the new buzzword which keeps the corporations of the 21^st century in check. Under these initiatives various corporations adopt renewable energy sources, despite their higher initial costs. This write-up particularly focuses on biofuels as an alternative source of energy.

Made out of living things and waste that living things produce, biofuels can be transformed directly into liquid fuels for our transportation needs. The two common types of biofuels include: ethanol and biodiesel. Biodiesel in its clean form is used as a renewable alternative fuel for diesel engines or as an additive to reduce vehicle emissions (up to 20%).

Energy Story: Italy and India

Italy’s story in this regard is quite stimulating. They pay special focus on Italy’s domestic energy policy, with two objectives at its heart, namely, lower dependence on energy imports and complying with the European 20-20-20 green commitments. This enthusiasm has quickens its speed primarily because Italy has one of the highest energy import dependence rates compared to other EU members. This zeal of using renewable energy sources (RES) in making Italy a leading producer of electricity is creditable. They further continue to innovate in this regard, for instance, last year Italy was the first country to introduce the first commercial scale plant making fuel from straw. Furthermore, by 2018 it strives to achieve 0.6% advanced biofuel in its petrol and diesel delivered in the country by all the fuel suppliers. To accelerate this process, they signed a Renewable Energy Directive (2009) requiring them to use renewable energy to contribute 10% to the transport sector. In this regard Chris Malins from the International Council on Clean Transportation says, “This shows Italy taking a real leadership role in Europe. It will be an example and a signal to other countries that are interested in this."

Although biofuels helps us reduce our dependence on foreign oils, which fluctuates in price rapidly and buffer against change, we must be aware that it may not always be a rosy picture. There are growing complaints with the mass production of biofuels, which hint at its growing importance at the cost of less land for food production. This can be explained as production of biofuel uses corn, soybeans and sorghum food crops which could alter the consumer’s access to affordable food. This can pose as a threat to food security and access to nutritious food which is also affordable by majority of the population. It can be easy explained using basic supply-demand principles of biofuels – for example, corn will become more expensive if the demand for corn continues to increase drastically (Source : Naylor).Similarly, there are other issues concerning fertilizer, water and land required to produce biofuel. Therefore, this attempt seems unethical to many, especially considering the size of global hunger.

In 2011, India was the fourth-largest energy consumer in the world and its need continues to rise, thanks to the dynamic economic growth and modernization. India’s import requirements are estimated to rise to 94% to their total petroleum consumption in the coming two decades. These figures indicate the desperation for India to adopt a new lease of life, should India consider a shift to biofuels? Indeed we should, given the tremendous potential of the Indian market when it comes to biodiesel. For this we must lay emphasis on tapping these markets by the means of proper channelization and utilization of resources. One of the strong advocates of Jatropha cultivation is Dr. Abdul Kalam for the production of bio-diesel. He suggests that out of 600,000 km² wastelands available, 300,000km² are suitable for Jatropha cultivation.

Implementing the Initiatives

The implementation of these initiatives has been started at numerous macro and micro stages. The former, for example, being the Indian Railways who use this energy and the latter being institutions using this at various state and city levels, for instance – initiatives and tie-ups for the production of Jatropha in states such as Andhra Pradesh, Chhattisgarh, Tamil Nadu, Maharashtra, Karnataka and Rajasthan. A healthier and wealthier future for India, a paper by NIT Durgapur suggests-in order to make India a major player in the biofuel sector we need to consider the following: 1. Commercialization and proper implementation of biofuels to achieve self-sufficiency, 2. Setting up of decentralized low capacity power stations in the rural areas using biodiesel to meet the energy crisis, 3. Greening and reclamation of wastelands and 4. Tackling issues of environmental concerns (global warming and rise in sea level) using biofuels.

It would be fair to compare India’s performance with another developing economy doing commendably in this regard- Brazil. Brazil has a long history of utilizing biofuels for the purpose of transportation, with ethanol- powered cars running on its streets, dating back to the early Twentieth Century. In 1931, to promote the use of ethanol in the transport gasoline, the government adopted various measures such as waiving taxes for its production and imported materials which are again used to produce the same. They further facilitated the sugar producers by making large investments in infrastructure. The Brazilian ethanol program was driven by the following two goals: a. the socioeconomic goal of providing employment and generating income for farmers and b. to reduce the reliance on foreign oil and foreign exchange for payments for energy. I believe India has a lot to learn and take from the Brazilian model.

The mismatched energy demand and supply that exists in India, an emerging economic power in the world, needs to be fixed urgently. Although the country faces challenges like inconsistent sugarcane farming, higher ethanol consumption, higher production cost and economic in-viability, I think it’s time to stop complaining but adopting new strategies becausewe need to accept that the demand for vehicles and the need for cleaner fuels is going to increase simultaneously. Therefore, I reiterate my initial quote which lays emphasis on multiple technologies to arrive at the necessary market equilibrium.

(Preeti Jha is post graduate student of ‘Agribusiness Economics’ from Gokhale Institute of Politics and Economics)