Creating Markets for Green Biofuels: Measuring and improving environmental performance

TitleCreating Markets for Green Biofuels: Measuring and improving environmental performance
Publication TypeReport
Year of Publication2007
AuthorsTurner BT, Plevin RJ, O Hare M, Farrell AE
Date Published04/2007
InstitutionUC Berkeley Transportation Sustainability Research Center
Report NumberUCB-ITS-TSRC-RR-2007-1

While “green” and “environmentally friendly” may seem synonymous with “biofuels,” this is not necessarily true in practice; all biofuels entail tradeoffs among positive and negative environmental effects. Because the environmental performance of biofuels is not measured today, consumers have no information about how to buy greener biofuels and producers have no incentive to manufacture and market them. The right set of market signals and regulatory requirements can change this situation, so that American consumers could buy biofuels certified as environmentally friendly, and so that the American agriculture and energy industries would have incentives to improve. Markets for green biofuels would stimulate a new wave of innovation, creating high-value and truly green biofuels, and enhancing energy security by diversifying our energy sources. However, without appropriate information, incentives, and rules, the biofuels industry is likely to expand production in environmentally harmful ways.

This study describes how some biofuels are produced, emphasizing agricultural production systems, and considers what is needed in order to measure and communicate environmental performance, and gives examples of how this might be done. We describe a set of seven uses of a Green Biofuels Index, from a wholly market-driven implementation through a set of increasinglyintrusive regulatory approaches. We then present several case studies of specific biofuel production pathways using a lifecycle analysis of the inputs to feedstock production and processing, but excluding market-mediated effects.

We recommend four steps to create markets for green biofuels:

1. Measure the global warming intensity of biofuels.

2. Measure the overall environmental performance of biomass feedstock production.

3. Develop and implement a combined Green Biofuels Index.

4. Research better practices, assessment tools, and assurance methods.

A Green Biofuels Index should be developed through a cooperative effort by environmental and energy regulators, agricultural agencies, and stakeholders from these communities, at either the state or national levels. Such an approach could be extended to other fuels as well.

Research is needed to develop better methods for producing biofuels as well as better ways of assessing and verifying the environmental performance of biofuels. Further work is crucially needed to address uncertainties and missing elements in current approaches, especially in agricultural greenhouse gas emissions, the effects of land-use change, greenhouse gas emission and ecosystems impacts associated with biomass thinning in forests, and indirect effects created by changes in markets for biomass feedstocks or food. The National Academies could, along with appropriate scientific bodies and stakeholders, help identify a research agenda to enable and expand markets for green biofuels. Regulators, the National Science Foundation, and other appropriate agencies (federal, state, and private) should support such a research agenda.

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