The mandates of biofuel in india


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  • After point 1 : The biofuel production and consumption statistics have been studied and a relation has been formed on how they affect the food and fuel prices, and their impact on food security by formulating the CPI index(both food, fuel and light) of industrial workers in India.
  • One has to take onto notice the magnitude of what Billion tonnes, Metric tonnes, quadrillion and gigaton
  • This clearly shows us that we have to start exploring alternate energy sources to meet our energy needs to maintain sustainability as we will eventually run out of fossil fuels.
  • The huge imports of fossil fuels, production and use of fossil fuels to meet the growing energy needs in India gives rise to a lot of environmental hazards, the important of then being the GLOBAL CARBON BUDGET.
  • IPCC(Intergovernmental Panel on Climate Change) studies indicate that we can not emit more than 800 billion tonnes of carbon in the form of carbon dioxide, so as to keep the temperature from raising by 2oC.
    We had already emitted 550 billion tonnes of carbon by 2012 which is 70% of the cumulative carbon emissions and the risk of increasing the temperature by 2oC is very high
  • Explain the graphs and the importance to switch to alternative renewable fuels, preferably biofuels.
  • such as unconstrained Carnot cycle fuel cell, Hydrogen fuels etc and biofuel is one of a very important aspect which aids us to reduce our dependence on oil and fossil fuel imports, use and thus contributing to a safer environment.
  • The crisis of 2008 is due to Global population growth and lack of ample stockpiles. Root causes may be the increasing use of biofuels in developed countries.
    The major IFPRI( International Food Policy Research Institute) Report launched in Feb 2011 stated that the causes of the 2008 global food crisis were similar to that of the 1972–74 food crisis, in that the oil price and energy price was the major driver as well as the shock to cereal demand
    A world bank policy research working paper released in July 2008 concluded that "...large increases in biofuels production in the United States and Europe are the main reason behind the steep rise in global food prices", and also stated that "Brazil's sugar-based ethanol did not push food prices appreciably higher"
    Japan produces over 100% of domestic rice consumption needs with 11 million tons produced in 2005 while 8.7 million tons were consumed in 2003–2004 period. Japan is not allowed to re-export this rice to other countries without approval. This rice is generally left to rot and then used for animal feed. Under pressure, the United States and Japan are poised to strike a deal to remove such restrictions. It is expected 1.5 million tons of high-grade American rice will enter the market soon.An economic assessment published in July 2008 by the OECD(Organisation for Economic Co-operation and Development) disagrees with the World Bank report regarding the negative effects of subsidies and trade restrictions, finding that the effect of biofuels on food prices are much smaller.
    This is supported by many studies as statistics show that since reaching record high prices in June 2008, corn prices fell 50% by October 2008, declining sharply together with other commodities, including oil, but ethanol production from corn has continued at the same levels, some have argued this trend shows the belief that the increased demand for corn to produce ethanol was mistaken
     While the debate is on both the sides, the current study indicates how the food prices in India have been affected and the prime concerns that we face.
  • CRUDE OIL : GDP effected, thus contributing to price increase
    TRANSPORTATION : Strikes, increase in fuel prices, more transportation costs.
    FERTILIZERS : International Fertilizer Industry Association) Prices tripled. The cause for these price rises was the rise in the price of oil, since the most fertilizers require petroleum or natural gas to manufacture. Ammonia Habers process. Thus effecting crop yield.
    Lack of cold storage capacities. Studies indicate the need for 10 million tons of cold storage to prevent the over 30% wastage of perishable produce. Every year over Rs 44,000 Crore wastage occurs due to the lack of high quality cold storage facilities and refrigerated transport for food manufacturers and food sellers are said to be two of the biggest contributors to food losses. This value is supposed to be even high during the economic crisis due to the strike’s in the transport sector as a result of steep rise in fuel prices
  • The study clearly indicates that steep raise in food prices in India is not due to the land patterns. As a mere 0.5 million hectares is only used for biofuel cultivation, jatropha cultivation, it’s contribution to the increase in food price is only negligible.
  • Amount of explict control on food prices is high when the crude pil prices are low and vice-versa
  • Generating rural employment through the National Rural Employment Guarantee Programme (NREGP) as explained in India’s National biofuel Policy.
    fruit picking by hand which provides jobs for around 200,000 people
  • The mandates of biofuel in india

    1. 1. The impact of Biofuel mandates in India by Ravi Kumar Pamu
    2. 2. Review The report submitted last semester comprised the following: • Review of literature on production of biofuels in India with special emphasis on how there has been a shift in cropping patterns: from food grains to commercial crops. • The review of literature also showed that with a rising demand for biofuels, and shifts in agricultural production from foodgrains to commercial crops, there was a direct impact on price of essential commodities such as foodgrains. In this phase, • I have highlighted on why there is a need to develop biofuels and their necessity in the transport sector so that the rise in food prices can be minimized. • Tried to establish the links between an economic study of biofuels to the broad field of chemistry.
    3. 3. Why understanding the impact of biofuel mandates is important even in the field of Chemistry • Understanding global energy needs (global energy consumption till the last decade) • Estimate future global energy needs • Global Carbon Emissions • Their impact on the environment and the future of our planet
    4. 4. • Extinction from date in years 40-80 207-590 100-2000
    5. 5. • 4th (172 metric tonnes, 8.27% of global imports) • 3rd (595 mt, 7.6% of global production) • 3rd (158 mt, 13.30% of global imports)
    6. 6. Global Carbon Budget • As per IPCC the environmental ability to assimilate carbon without increasing the average global temperature by 2o C • We have exhausted about 70% of the cumulative carbon emissions, and the risk of the temperature increasing two degrees is very high.
    7. 7. Effects of exceeding the Global Carbon Budget • Global Carbon Budget
    8. 8. Possible solution • As CHEMISTS there is a dire need for us to understand the magnitude of these numbers which has multiplied over the past and collective realistic efforts are required towards the future of our planet. • Hence we must formulate a global energy policy that is based on renewable and sustainable energy sources • Biofuels can prove to be one of the most important commodities that will reduce our dependence on oil and fossil fuel imports thus contributing to a safer environment.
    9. 9. Food versus Fuel Debate • The rise of global food prices mainly can be attributed to the following factors • Major Factors • Increase in the global population • unfavorable climatic contiditons • Increase in the global crude oil prices • Distorted global rice market (WTO rules) • Diversion of food crops for the production of biofuels • Change in the crop patterns
    10. 10. Food versus Fuel in India • The rise of food prices in India mainly can be attributed to the following factors • Major Factors • Increase in Crude oil prices • Increase in the price of crude oil or fossil fuel reserves which causes the rise in the transportation cost • Increase in the price of fertilizers that arise as a direct consequent of hiked fuel price
    11. 11. Observations • Steep rise in food prices is not due to biofuel production in India ( Biofuel production and land patters in India) • The major increase in food prices is attributed to the increase in the fuel price, which in turn has an impact on the production of fertilizers, which when are not available to agricultural farmers reduce the yield drastically. Hike in oil prices also affects the transport sector due to high fuel costs (trends clearly observed in CPI index, formulated in the preliminary report). • Hence the study concludes that Higher Global Crude Oil prices are primarily responsible for and contribute to rising prices of agricultural commodities.
    12. 12. Food prices hike in India Hike in crude oil prices 1)Effects the GDP 2)Effects transportation Sector 3) Effects fertilizer production and reach Hike in fuel prices
    13. 13. Proposition • From all the above observations there is clearly a need to formulate a plan to produce alternate fossil fuels/biofuels from crops different from food crops, using waste land or uncultivated forest land patterns. (Projected biofuel estimates) • Encouraging second and third-generation biofuels (such as cellulosic ethanol and algae fuel, respectively) to ease the competition with food crops • Providing rural employment through Jatropha cultivation • Creating awareness on the importance and role of biofuels in the domestic energy sector • Upgrading transport infrastructure to reduce dependence on fossil fuels and reduce food prices.
    14. 14. Proposition • Emphasis on new and improved technologies to produce biofuels from non food feedstock. • Developing technologies and establishing bioethanol plants near sugar industries as the molasses by product formed can be used to produce bioethanol. • Encouraging farmers to undertake plantations that provide the feedstock for bio-diesel and bio-ethanol. • Providing more concessions to the existing 16% on bioethanol excise duty. Biodiesel is completely excluded from excise duty. Central taxes and duties should be levied on bio-diesel and bio-ethanol.   • The government must remove any custom and excise duty concessions provided on plant and machinery for production of bio-diesel or bio- ethanol, as well as for engines run on biofuels for transport, stationary and other applications, if these are not manufactured indigenously.
    15. 15. Conclusion • The study concludes that Bio-Energy is one of the several energy options that can deliver a sustainable environment friendly energy option which can replace fossil fuels, reduce India’s dependence on oil imports, boosting economic growth and providing food security.
    16. 16. Bibliography • Energy in the age of Sustainability Hector D Abruna • U.S Energy Information Administration (http://www/ • Key World Energy Statistics 2013, International Energy Agency • INDIAN BIOFUEL SCENARIO: AN ASSESSMENT OF SCIENCE AND POLICY, VIJAI PRATAP SINGH • Global Carbon Budget 2013; • Carbon Dioxide Information Analysis Center
    17. 17. Bibliography • Government of India, Ministry of New & Renewable Energy “National Policy on Biofuels” ( manager/UserFiles/biofuel_policy.pdf) • An Assessment of the Biofuels Industry in India Joseph B. Gonsalves1 • International Energy Agency (IEA) • Energy Future Coalition • Biofuel related price transmission literature : A review by Teresa Serra, David Zilberman
    18. 18. Thank You