A new report charges that government subsidies for biofuels aren’t working and that policy makers should rethink where they spend public funds intended to reduce greenhouse gas emissions.
The report looks at subsidies aimed at nurturing Canada’s biofuel industry, from money for research and development to capital investments and operating costs.
“Public subsidies for biofuels have been justified on their environmental merits, as well as the economic boost they provide to rural economies,” said International Institute for Sustainable Development associate Stephan Barg.
“However, our research shows that these policies are an extremely expensive and inefficient way to conserve fossil fuels and reduce GHG emissions.”
Barg said the institute’s report details the impact of these investments and should give policymakers pause.
“To remove one tonne of greenhouse gases from the atmosphere via corn- or wheat-based ethanol costs between $200 and $400. By comparison, one tonne of CO2 reductions cost $4.25 on the Chicago Climate Exchange or $33.85 on the European Climate Exchange,” he said.
However, Barg noted that many of those subsidies will decline and that much of the investment went to research and development and capital investments.
Gordon Quaiattini, President of the Canadian Renewable Fuels Association, said the report is biased against biofuels and that government subsidies are better described as an investment that nurtures an industry critical to Canada’s future energy needs.
“It is clear traditional energy resources are diminishing,” he said, referring to finite deposits of oil. A future decline in oil and growing energy requirements will need to be met with new energy sources, he said, adding that biofuels, solar, wind and tidal energy will all be part of the mix.
The association is alleging that the report overstates government subsidies and doesn’t reflect that government taxes on those fuels offset much of the incentives. The association also says the report omits recent data showing biofuels can help reduce greenhouse gas emissions significantly when compared with conventional fuels.
While Barg concedes the report may miss some information, he said the main point stands: the government should look at the level of funding provided to biofuels and consider other ways for Canada to reduce its greenhouse emissions.
A better way to reduce the country’s greenhouse gas emissions and use of fossil fuels is likely energy efficiency, he said.
A copy of the report, “Biofuels - At What Cost?” can be found at the institute’s website: www.iisd.org. The Canadian Renewable Fuels Association’s rebuttal can be found at www.greenfuels.org under media news releases.
The report looks at subsidies aimed at nurturing Canada’s biofuel industry, from money for research and development to capital investments and operating costs.
“Public subsidies for biofuels have been justified on their environmental merits, as well as the economic boost they provide to rural economies,” said International Institute for Sustainable Development associate Stephan Barg.
“However, our research shows that these policies are an extremely expensive and inefficient way to conserve fossil fuels and reduce GHG emissions.”
Barg said the institute’s report details the impact of these investments and should give policymakers pause.
“To remove one tonne of greenhouse gases from the atmosphere via corn- or wheat-based ethanol costs between $200 and $400. By comparison, one tonne of CO2 reductions cost $4.25 on the Chicago Climate Exchange or $33.85 on the European Climate Exchange,” he said.
However, Barg noted that many of those subsidies will decline and that much of the investment went to research and development and capital investments.
Gordon Quaiattini, President of the Canadian Renewable Fuels Association, said the report is biased against biofuels and that government subsidies are better described as an investment that nurtures an industry critical to Canada’s future energy needs.
“It is clear traditional energy resources are diminishing,” he said, referring to finite deposits of oil. A future decline in oil and growing energy requirements will need to be met with new energy sources, he said, adding that biofuels, solar, wind and tidal energy will all be part of the mix.
The association is alleging that the report overstates government subsidies and doesn’t reflect that government taxes on those fuels offset much of the incentives. The association also says the report omits recent data showing biofuels can help reduce greenhouse gas emissions significantly when compared with conventional fuels.
While Barg concedes the report may miss some information, he said the main point stands: the government should look at the level of funding provided to biofuels and consider other ways for Canada to reduce its greenhouse emissions.
A better way to reduce the country’s greenhouse gas emissions and use of fossil fuels is likely energy efficiency, he said.
A copy of the report, “Biofuels - At What Cost?” can be found at the institute’s website: www.iisd.org. The Canadian Renewable Fuels Association’s rebuttal can be found at www.greenfuels.org under media news releases.
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