Biofuels Remain an Important and Growing Sector for Developing Countries, New UNCTAD Report Says

(United Nations Conference on Trade and Development) The report entitled: "The State of the Biofuels Market: Regulatory, Trade and Development Perspectives" offers a comprehensive snapshot of today's biofuels market and how it contributes to enhancing access to renewable energy sources sustainably and improving the livelihoods of people in developing countries.
Biofuels now account for 1 per cent of global energy use, a new UNCTAD report on the state of the global biofuels market has found, with second-generation technologies, climate change concerns and economic pressures shaping the future of this increasingly important sector.
Nonetheless, "while alternative energy sources are growing faster than any other energy source, they still account for a very limited share of primary energy demand, therefore they are not expected to replace fossil fuels but to play a complementary role in satisfying the world energy demand," the report says.
The State of the Biofuels Market: Regulatory, Trade and Development Perspectives was launched on 24 September at the World Bio Markets Brazil Conference in Sao Paulo, Brazil, and offers a comprehensive snapshot of today's biofuels market and how it contributes to enhancing access to renewable energy sources sustainably and improving the livelihoods of people in developing countries.
The report is an update of a similar report produced by UNCTAD in 2006 and notes that as of 2014 bioethanol and biodiesel had already become established products traded daily in all continents thanks to their use in the transport sector, especially for road vehicles.
However, an important development has been the emergence of alternative markets for liquid biofuels, which are now used in commercial aviation, electricity generation, for cooking energy and even in maritime transport.
As well as offering analysis of the state of today's biofuels market, the report contains policy recommendations for developing countries to make beneficial use of biofuels.
These include the creation of regulatory frameworks tailored to national resource endowments which do not antagonize food and energy supplies but rather enhance agricultural productivity, rural income and workers' skills.
The development of competitive second-generation biofuels, which are made from woody crops, agricultural residues or waste (unlike first generation biofuels made from the sugars and vegetable oils found in arable crops), will pose a number of challenges to developing countries, the report says.
One key recommendation is a call for international strategies to avoid the emergence of a technological gap between land-intensive first generation and capital-intensive second-generation biofuels.
Developing countries also need to:

The report represents a contribution to the wide-ranging global discourse on energy security, sustainable development and poverty alleviation.
As the UN system gears towards the definition of the Sustainable Development Goals for the international community in the period post-2015, the linkages between energy and development lie high in international agendas. Governments, intergovernmental organizations, corporations, non-governmental organizations (NGOs) and even individuals are asking themselves a number of questions that are crucial for sustainable development prospects of all countries.

Alternative energy sources, including biofuels, already have been forming part of the answers to these questions. While alternative energy sources grow faster than any other energy source, they still account for a very limited share of primary energy demand, therefore they are not expected to replace fossil fuels but to play a complementary role in satisfying the world energy demand.
Section 1 of this report presents the recent developments in the international energy scenario.
Sections 2 and 3 address respectively the biofuels use in transport, as well as market and regulatory developments for biofuels in a number of developed and developing countries.
Section 4 deals with the state of technological progress of the biofuel industry.
Section 5 addresses the issue of support measures for the biofuels sector, followed by Session 6 which cover the linkages between biofuels with broader development challeges in the world as of 2013.
Sessions 7 and 8 examine trade flows of biofuels and related feedstocks, as well as recent developments and WTO implications.
The study focuses on the opportunities and issues faced by developing countries interested in this market, in terms of diversifying energy sources and reducing dependence on fossil fuels, mitigating climate change effects, increasing markets for agriculture products and enhancing the participation of rural communities in economic activities. While utilization levels increased many fold since 2006, biofuels still raise concerns and this prompted a regulatory push for 2nd generation fuels, which started being deployed in 2013. The actual and potential challenges and opportunities, especially for developing countries, are analyzed.
Section 7 presents some data on trade flows for biofuels and related feedstocks among the US, EU and Brazil. Section 8 deals with some specific World Trade Organization (WTO) issues which may have direct implications for biofuels.
The last two sections of the study illustrate UNCTAD´s activities under its BioFuels Initiative. Download Report
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Excerpt from Biofuels International: Africa has become the new frontier for innovative non-food crop based biofuels' projects, according to a new report by the United Nations Conference on Trade and Development (UNCTAD).
The report, 'Second-Generation Biofuel Markets: State of Play, Trade and Developing Country Perspectives', says that these initiatives are mainly taking place in Eastern and Southern Africa even though West Africa has also been the stage of promising projects.
According to the report, the production and trade of second generation biofuels in Africa is characterised by its limited scale and the existence of promising market niches such as cooking fuel supply.
The current low price of oil, difficulties encountered in the implementation of earlier projects, as well as the higher level of investment required for the development of second-generation biofuels ventures do not point towards a large-scale development in the near term, the report highlights.
However, two main types of second-generation biofuel projects can be found on the continent — the transport industry and domestic uses such as cooking. In addition, the use of bagasse to generate electricity could be regarded as an additional advanced biofuel-related practice, which has increased in Africa. READ MORE