Member states of the OECD (Organization for Economic Cooperation and Development) are spending more than $11 billion a year helping biofuel producers gain a toe-hold in the market for liquid fuels. As if that were not enough, rafts of already announced intentions are being developed in government ministries around the world. A mixture of open-ended, demand-driven payments and mandatory minimum blended fractions will see that figure soar.
Based on the current policy drivers we foresee support for biofuels the OECD region reaching at least $20 billion by 2010 and anywhere between $30-60 billion by 2020, sciencealert.com reported.
With taxpayers being asked to throw sums like these on the table, you’d think someone had stumbled on an environmental and energetic jackpot. Biofuels are being touted as offering benefits for agricultural policy, rural development, farm-subsidy reform, employment, greenhouse gas reductions and energy security.
In some quarters they are being touted as the means to completely change the terms of trade between poor tropical countries and the rich, oil dependent North.
Not only is it a good cause: biofuel, it is claimed, will very soon become self-sustaining. Fully commercial, unsubsidized “green“ fuel lies just around the corner with a triple dividend for energy security, environmental security and development in some very disadvantaged countries.
There are good reasons to believe none of these outcomes is likely to be achieved any time soon, if ever. Behind the hype, the facts are less reassuring.
In the first place, it is highly unlikely that the planet can produce biofuels on the scale likely to be required by future projected demand for mobility. Biomass grown for conversion into liquid fuels is in competition with biomass grown for food and fibre. There is only so much of the planet we can appropriate without causing loss of species on a calamitous scale together with the degradation of the so-called “ecosystem services“ that flow from the biologican and geo-chemical processes that make this planet liveable and living.
The best estimates suggest an upper limit for biofuel production of about 20 percent of liquid fuel demand (including from so-called second generation fuels) in 2050--scarcely enough of a margin to provide energy security for those condemned to import their oil. And nowhere near enough to back off skyrocketing emissions from fossil fuels, even if sourced from cropping systems with the best well-to-wheels life cycle analysis.
But even this level may prove beyond reach because biomass harvested for biofuel is not available for other uses such as food or fiber production, or wildlife. There is a contest for the by-products of photosynthesis on which we rely for our survival. Strong economic growth throughout Asia and elsewhere has already put a floor under the prices received for a wide range of agricultural commodities.
Start to inject significant levels of demand for some of those commodities as biofuel feedstocks (which subsidies are doing right now) and a tight situation becomes tighter still. Very simply, without subsidies, biofuels may never be competitive.
This hasn’t stopped all manner of technological optimists arguing that the pressures are transitional--and with them, the subsidies. Leaving aside those evidently self-interested investors who have gambled on a lavish taxpayer-funded transition to this nirvana, this question must be asked of the rest: why should biofuels receive such royal treatment when a host of alternative technologies that both supply energy and minimize its use are also to hand? Every policy has an opportunity cost and $11 billion a year represents a significant opportunity.
None of this is to argue that biofuels do not have a role to play. Of course they do. Depending on particular regional settings--lots of sun, soil productivity and water with all sorts of co-benefits and co-products can make a world of difference. Countries like Brazil can do very nicely. But there are environmental limits even there.
Simon Upton

Unlike fossil fuels, wind turbines do not produce the greenhouse gases blamed for global warming.

Gov. Donald L. Carcieri pledged nearly two years ago to bring wind power to a state where there is just one operating wind turbine. His goal was to get 15 percent of the state’s electrical power from wind by 2011--which would require about 100 turbines.
That goal now seems unlikely because no one has decided where to put a wind farm, it’s not clear how the project will be paid for and public opposition--a major wild card--is unknown, according to Carcieri’s top energy adviser, Andrew Dzykewicz. Still, he is hopeful the Ocean State will be getting a large portion of its energy from wind by sometime after 2012, Telegram.com reported.
New England needs new electricity sources and has some of the highest electricity rates in the nation. Wind is free and abundant along the coastline. Also, unlike fossil fuels, wind turbines do not produce the greenhouse gases blamed for global warming.
Carcieri hopes wind power can help stabilize electricity costs and increase supply. In January 2006, he announced an energy plan that included measures such as using hydropower, reforming the state’s electric market, reducing state government’s energy use and the use of wind power. Later, he said he thought the state could reach the wind goal around the time his term ends in 2011.
This spring, his administration proposed building about 100 offshore wind turbines in Narragansett Bay, enough to power about 175,000 homes. The only major wind turbine in the state is at Portsmouth Abbey, a monastery and school.
While Carcieri’s administration has made some progress, it’s been slow going.
“We won’t have the blades turning by the time he’s gone,“ Dzykewicz said.
Dzykewicz said he anticipates the state could have an offshore wind farm in the next five to seven years. But even that could be too optimistic.
Across the border in Massachusetts, opponents of a plan to build 130 wind turbines off Cape Cod in Nantucket Sound have stymied the Cape Wind project for more than six years because of fears that it could it could spoil views of the water and cause a hazard for boaters.
With fishing and tourism also key industries in Rhode Island, a similar proposal for an offshore wind farm could face similar opposition here.
No other state has built an offshore wind farm, forcing Rhode Island’s government to invent the process from nearly scratch. One of the state’s main environmental regulatory bodies, the Coastal Resources Management Council, has not even decided what it requires from prospective wind power developers.
The state also hasn’t settled on a basic question: Where to put wind turbines.
Earlier this year, Dzykewicz’s office assembled a panel of wind power advocates, environmentalists and others to whittle down the list of promising locations. It met four times, then decided it did not have enough information to make any decisions.
Panel members including Matt Auten, an advocate for Environment Rhode Island, a nonprofit group that lobbies for tighter anti-pollution rules, praised Carcieri for seeking community input, but said picking wind farm sites is impossible until they know the environmental impact.
“The ’where’ question is very important“ if Carcieri wants to avoid Cape Wind-like delays, Auten said.
That question now falls to Dzykewicz, who said his office will probably try to get permits for several areas and see which are acceptable to regulators.
Permitting alone will take at least two years, Dzykewicz said. Once they’re secured, Carcieri’s office must then find a developer and backers to build and fund the project, a process expected to take several months.
At least two developers and several finance firms have said they are interested.
Some wind power advocates have pushed for lawmakers to force electricity distributors such as National Grid, the state’s dominant distributor, to buy renewable energy at a premium. A National Grid spokesman said the firm supports renewable energy, but it believes too much is uncertain to make promises now.

Energy prices and the conflict in the Middle East, combined with growing concern over the progress of global warming, have jump-started a long overdue national conversation about the direction of America’s energy policy. The public is clamoring for solutions and, in this generation, there has never been deeper support for increasing the amount of power that the US gets from renewable energy.
Right now, America is failing to take advantage of its almost unlimited potential to generate electricity from renewable sources of energy like wind and solar power, southernillinoisan.com reported.
The United States has historically been a leader in the deployment of renewable energy technologies. As recently as the mid-1990s, the US was the world’s leader in solar power capacity and number two in wind. That is no longer the case. By 2004, Japan had three times the solar photovoltaic capacity of the United States, while Germany had more than double the capacity. The US is now third in installed wind power capacity behind Germany and Spain.
Currently, Germany employs over 40,000 workers in its wind energy industry and Denmark another 20,000. Both of these countries have wind resources that are only a fraction of those in our nation’s windiest states. In Germany, the wind energy industry is the second largest consumer of steel next to the automotive industry.
Fortunately, an expanding number of communities are pressing the nation toward cleaner renewable energy. State and local officials are increasingly seeing the local economic development benefits of renewable energy.
Farmers and ranchers recognize the benefits renewable energy provides for agricultural interests and rural economies. And, workers and businesses are beginning to understand that renewable energy technologies have the potential to create high quality jobs that will drive the nation into the 21st century.
Already 25 states--including Illinois--have passed renewable energy standards of their own, committing nearly half of the country’s population to renewable energy targets as high as 25 percent by 2020. Last year the Illinois General Assembly unanimously passed a strong renewable energy standard which will increase the amount of power that the US gets from clean renewable energy to 10 percent by 2015 and 25 percent by 2025. The same legislation sets the first ever utility energy efficiency standards, which requires our utilities to use energy efficiency programs to lower demand throughout the state.
This program will save about a billion kwh of power per year, approximately the amount that 100,000 people would use in a year. Our General Assembly recognized that renewable energy and energy efficiency solutions not only reduce pollution but they help improve our economy, creating jobs and saving consumers money on their energy bills.
A new report by the Blue Green Alliance and the Renewable Energy Policy Project found that renewable energy manufacturing could create 56,000 jobs in Illinois. That report documented that thousands of existing firms throughout the state are equipped to begin making components for wind turbines and solar panels immediately.
In addition, by shifting away from fossil fuels, the US can diversify and secure its energy supply while reducing global warming pollution. The UCS (Union of Concerned Scientists) analysis based on assumptions of the Energy Information Administration indicates the House standard requiring 15 percent renewable electricity by 2020 would cut global warming pollution by 126 million metric tons by 2020; the equivalent of taking 20 million cars off the road.
Building on the momentum of states like Illinois, it is now time for Congress to act and pass a final energy bill that includes the renewable electricity standard. As the House and Senate work out the differences between their energy bills, it is critical that they include a renewable electricity standard of at least 15 percent. By supporting this legislation in the final energy bill, Senators Durbin and Obama can help build a cleaner and more secure economy for America, while reducing global warming pollution and making the US once again the world’s clean energy leader.

Annual demand for solar equipment is growing at 40 percent.

Now that you’ve blown your next two years’ bonuses on subprime mortgages and homebuilder stocks, you need a recovery strategy.
Look no farther. Solar power. It’s irresistible. You can recoup your losses and fight global warming at the same time. Companies that make equipment to convert sunlight into electricity--rather than by producing it with coal and natural gas that pollute--are already profitable. No gambling on an unknown startup, Bloomberg reported.
First Solar Inc., a Phoenix-based company that makes modules used in solar panels, reported its third-quarter profit was up 10 times to $46 million, or 58 cents a share, as sales more than tripled to $159 million.
Demand for solar equipment is growing at an annual rate of 40 percent. Google Inc., the Internet search engine company, just announced it would spend hundreds of millions of dollars to develop alternative forms of energy such as solar power. It plans to reduce the electricity costs of its power-hungry computers and sell cheaper energy to others.
While solar equipment, like any new technology, is relatively expensive, subsidies from national and state governments make it affordable for business and homeowner customers and profitable for the manufacturers.
So profitable that First Solar, which went public a year ago at $20 a share, closed at $215.88. The company now has a total stock market value of almost $17 billion, exceeding that of either General Motors Corp. or Ford Motor Co. If you don’t think that’s a big deal, consider that the solar company’s value isn’t that far behind the $23 billion number for NYSE Euronext, which owns the world’s biggest stock exchange and has been a hot stock much of this year.
You can play sun power all over the world. Q-Cells AG in Thalheim, Germany, reported third-quarter profit of 34 million euros ($50 million) and this month forecast 2009 sales of 1.7 billion euros, compared with 540 million euros in 2006. Q-Cells, which makes the solar cells that make the modules that make the panels, is even more inviting if you think the euro will continue to rise against the dollar.
There’s a China angle too. Suntech Power Holdings Co. in Jaingsu province, makes solar cells and had a third-quarter profit of $53 million. Its shares have more than doubled this year in New York Stock Exchange trading.
Demand for solar equipment may be just beginning to grow. Increased sales will help manufacturers bring down their unit costs. The price of refined silicon, a key ingredient for solar products, should decline as the capacity for making the material grows.
Solar stocks aren’t for the fainthearted, though that won’t bother you. Skeptics will advise against buying First Solar or, say, SunPower Corp., a Sunnyvale, California, maker of solar panels that stands to get as much as $190 million in financing from Morgan Stanley, even though they are both in the black.
First Solar trades at 288 times earnings in the latest 12 months, SunPower at 275 times, while the price-to-earnings ratio on Google, everybody’s favorite speculation, is 56.
After all, based on estimated profit for 2007, First Solar’s P/E is a mere 170, SunPower’s 98.
Oh sure, there’s also a chance you might bet on the wrong company. Some upstart may develop superior technology. Or solar power may never be profitable without government handouts. Ethanol as an alternative energy has had a rocky road.
Forget the warnings. You can be partners with Al Gore and the kids at Google--and you need a winner. Leap for the sun.