Monday, Mar 19, 2018 at 14:38
Mark, the biodiesel argument always rages on about its efficiency and expense.
In Europe, there is an EU-Union mandated target set for a 10% level of biodiesel for 2020.
The EU is not looking at the simple bowser cost of straight diesel vs biodiesel - they are looking at the benefits of cleaner air from biodiesel, and increased employment and income within the EU countries, as agricultural production is ramped up.
The EU has seen what happened to Brazil, which was staggering under a monstrous trade deficit and national debt, largely due to massive oil imports.
Within a few years of mandating ethanol biofuels, supplied by sugarcane grown within Brazil, the country paid off all its outstanding national debt.
Their fuel import bill went to a much lower sustainable figure in this time frame.
Ethanol currently supplies 17% of Brazils fuels at present - but this can vary due to market pressures and crop yields.
Of course, there was also huge pressure to ramp up Brazils oil exploration and production in the same time frame - which largely succeeded.
Rapeseed oil comprises 66% of the current vegetable oil supply used in EU bio diesel.
Rapeseed is easily grown in many EU countries, it can be grown on waste land, and it is used as a break crop to reduce diseases in other crops.
In addition, Rapeseed production efficiency is increasing with improved varieties and improved farming techniques.
There is definitely a constant see-saw between biofuels and petroleum fuels, simply because of the huge number of variables affecting pricing, markets, and demand.
Essentially, when petroleum fuels rise in price due to price fixing and manipulation (as is happening now with OPEC), then biofuels make inroads into the fuel market.
Accordingly, when oil prices slump, biofuels rapidly lose ground due to cost.
It is Govts that set the market for biofuels - via mandated targets, taxation regimes, and other economic measures.
I personally believe biofuels need to be encouraged to ensure competition in the energy marketplace and to reduce our reliance on oil imports.
One thing's for sure - biofuels won't be going away anytime soon, and the EU is driving that section of transport fuel production along, at a steady pace.
Cheers, Ron.
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