IFAP policy work on bioenergy
By Nora Ourabah Haddad, IFAP Policy Officer
17th Informal Consultation between the World Association of Beet and Cane Growers (WABCG) and the International Sugar Organisation (ISO)
London, UK, 20 November 2006
The main focus of my presentation is to first, highlight some of the key issues under discussion within the IFAP, related to the issue of bioenergy.
Subsequently, I hope to receive feed back from cane and beet producers to enrich these discussions. I also hope that WABCG representatives will take part in the IFAP Working Group on Bioenergy.
It is important to ensure that the IFAP policy positions represents the views of all farmers and particularly commodity organisations that are very close to action on the ground.
Governments are heavily involved in discussions on renewable energy in various international forums. They are making commitments that will affect the situation of farmers over decades.
IFAP is engaged in these international processes concerning the development of bioenergies to make sure that all farmers’ interests are taken into account including the interests of beet and cane growers which is why we are having this discussion.
The United Nations Commission on Sustainable Development (UNCSD) is one of the most important lobby platform for sustainable development related issues. It is a Ministerial level forum for sustainable development. The UNCSD is inclusive of civil society participation. IFAP has become the lead representative of the Farmers as a Major Group.
The CSD meets annually at the UN headquarters in New York, in two-year cycles, with each cycle focusing on clusters of specific thematic and cross-sectoral issues. The first year of each cycle focuses on identification of constraints, obstacles, successes and lessons learned. Whereas the second year is the negotiation year with government ministers. One of the cluster themes of the current 2006-2007 cycle is on Sustainable energy and Climate change. Next year, 2007 will be the negotiation year on this theme and IFAP, along with WABCG, will have the opportunity to make recommendations from farmers.
IFAP is also representing farmers in the Global Forum on Agricultural Research (GFAR). GFAR wants to build biofuel villages where farmers and researchers work together to develop second generation technology for bioenergy, including the selection of appropriate crop varieties. This work will be supported by funds from the CGIAR-World Bank Challenge Program.
I want to also mention the UNCTAD Biofuels Initiative that is supporting the investment in Biofuels in developing countries. They are starting by building a data base of Case studies and best practices, which can then be replicated. The IFAP President is a member of this advisory committee on this Biofuels Initiative.
Finally, IFAP is working with the UN Framework Convention on Climate Change. This Convention and its Kyoto Protocol has obvious links to bioenergy. Greenhouse gases like CO2 can be reduced through use of renewable energy.
Now I would like to outline the main messages that we are getting from our farmers’ organisations.
The first one relates to a need expressed by a majority of farm leaders worldwide who see in Bioenergy, a new opportunity to improve their incomes. However, they are well aware that Bioenergy strategies have to be carefully thought through. Farmers need a clear commitment from their national governments to put in place regulatory framework to facilitate the development of bioenergy.
Bioenergy sources that we are covering are: biofuels, biogas as well as solar and wind energy.
In order to develop the potential of bioenergies, farmers do need a stable investment environment. Farmers also want to become real partners in the provision of value added products in bioenergy and not only the producers of raw materials.
It is not acceptable that all the benefits go to the large bioenergy companies. Thus government intervention is needed.
Governments need to have comprehensive forward-looking policies. They must work on the following priorities:
- Providing farmers access to the necessary capital
- Making sustainable energy technologies cost competitive for farmers
- Minimising risks for farmers
Many farmers in IFAP discussions brought up the issue of incentive mechanisms to encourage farmers to invest in Bioenergy production. They agree on the need to identify such existing support mechanisms (tax exemptions, duty rebates and capital allowances) or contract conditions for sharing benefits through an exchange of information between farmers in different countries, and we would like also the WABCG to be involved.
Appropriate accompanying mechanisms also need to be identified to facilitate the development of renewable energies in the agricultural sector. These include measures to: improve farmers’ access to energy markets, the financing of farmers’ owned plants, and increasing farmers’ participation in discussions on benefit sharing, address regulatory issues, reduce business risks for farmers for the introduction of new technologies and carbon accreditation to reward farmers.
The role of research institutions is also a key factor in the development of bioenergies.
Farmers need to be able to identify the right options before engaging in bioenergy production. For this, they need appropriate information and data to be able to evaluate corporate costs and the right crops to be used for energy production. If the wrong choices are made, then there is a risk for agriculture to disappear. Farmers need to work hand in hand with the research community to close the knowledge gap and help them make the right choices at cost effective prices.
To carry out this role, the research community should be supported by governments in order to develop small-scale technology for bioenergy for farmers.
Diversification of the possible sources of bioenergy is also needed through strong primary research on new energy crops, new energy-specific varieties of existing crops, increased production efficiency, improved processing techniques and crops that yield both high energy content and high quality by-products.
Trade issues also stimulate a lot of thinking. Trade prospects of bioenergies in particular biofuel exports are limited by several issues such as: the clear classification of biofuel products (agricultural, industrial or environmental products), the effect of subsidies extended to feedstock or biofuel output and by- products, the existence of non-trade barriers and production method standards and the existence of preferential tariff arrangements and differential export taxes. And yet, in order for biofuels to be a real asset for farmers, they must become internationally tradable commodities.
Some countries are currently pushing for the development of international standards. Will such regulations help or hinder the ability of biofuels to be an economic development tool? How should farmers position themselves in order to reap the benefits of trading value-added energy products and use their comparative advantage?
There is a need to also raise subsidy related-issues in the biofuel industry e.g. are subsidies for biofuels considered as “green” by WTO standards.
Bioenergy production is not a miracle solution to the situation of farm incomes. It is however an important part of the solution if properly handled.
The international context overwhelmingly encourages the development of alternative sources of energy such as renewable energies. Oil production and prices are set to remain over 60 $ per barrel over the foreseeable future. And yet energy consumption and needs are expected to continue rising in the coming years. The need to find other sources of energy to meet these needs in a more sustainable way is becoming urgent.
In fact, fossil fuels, the current largest single source of world energy will eventually run out. It is not a question of if but rather of when this is going to happen.
Bioenergies have many benefits. In particular, they contribute to overcoming energy supply constraints, to climate change protection (carbon saving source), environmental protection, national security and economic development (through job creation) and income generation.
Increased utilisation of renewable energy will rely to a significant extent on agriculture in both the short and the long term.
An issue which often comes up in this context is food security versus energy production.
Governments need to ensure coherence between agricultural policies (which relate to food security) and sustainable energy policies.
Is there enough land to both produce food and fuel for the growing world population? Questions regarding the sustainable production of bioenergies, have not been looked at in depth.
Development of bioenergy requires considerable investment and a commitment to stay with it over the long term. Thus, there is a need for further analysis on the development of bioenergies and their impact on the demand and supply of commodities as well as their prices, in order to assess the level of their viability over the long term.
Further more for developing countries, investing in infrastructure for bioenergy production represents a real challenge. It is indeed one of the main obstacles facing these countries. Developing countries’ governments lack the necessary resources. Multinationals tend to take advantage of lower costs in these countries to buy out land from farmers and invest in large scale industrial bioenergy production, to the detriment of the local economy and local people. This situation puts farmers in a difficult situation. It also presents a danger for the sustainability of their national food security.
In conclusion, it seems to our leaders in IFAP that prospects are quite encouraging. There are significant opportunities for farmers worldwide to position themselves as beneficiaries of bioenergy openings. However, for this to happen under the best conditions, national governments must make a commitment to renewable energy and work with farmers’ organisations to deliver the goods.
I briefly outlined some of the ideas that we are working on to achieve this, and indicated that we have real possibilities to influence government decisions in this area through the consultative relations that we enjoy with intergovernmental organisations. Now, I look forward to hearing your views.
Thank you.