Global Biofuel Alliance and Significance of Biofuels-Explained,Pointwise

Formal establishment of Global Biofuel Alliance (GBA) will be one of the key takeaways under India’s G20 Presidency.

Biofuels are the fuel derived from the biomass of plants or animal wastes. It is commonly produced from corn, sugarcane and animal waste like cow dung. These come under renewable energy as it sources are renewable unlike fossil fuels.These biofuels like bioethanol and biodiesel are blended with petrol or diesel which results in cost saving and reduces environmental pollution.

Global Biofuel Alliance will be the second India led multilateral platform after the International Solar Alliance (ISA) launched at Paris COP21 in 2015. Establishment of Global Biofuel Alliance will catapult India at the centre stage of climate action and reinforce India’s position in the fight against climate change.

What is Global Biofuel Alliance and what are its objectives?

Global Biofuel Alliance- Global Biofuel Alliance is being established by India, Brazil and US which together account for 85% of global Ethanol Production. It will be an international platform for sharing best practices, promoting sustainable biofuel development and enhancing its application. It aims to impact global energy architecture and achieve the target of net-zero emissions.

Core members-India, Brazil and US.

Membership and endorsement-Other members can join the Global Biofuel Alliance by endorsing the foundation document. The membership is open to non-G-20 countries also. This alliance will be like the International Solar Alliance as the membership will be open for all countries to join. So far 19 countries have shown interest to join other than the founding members which includes countries like Italy, Kenya and UAE.

Membership structure- GBA will have three category membership structure bringing together member countries, partner organisations and industries.

Objectives- Following are the objectives of Global Biofuel Alliance

1.Promotion of International collaboration and cooperation to encourage the acceptance and utilisation of biofuels.

2.Development of robust markets for biofuels and facilitate global trade in biofuels.

3.Intensification of the use of sustainable biofuels in the transportation sector.

4.Development of concrete policy lesson-sharing and provision of technical support for national biofuels programs worldwide.

5.Emphasization of the already implemented best practices and success cases.

6.Complement the relevant existing regional and international agencies as well as initiatives in the bioenergy, bioeconomy, and energy transition fields more including the Clean Energy Ministerial Biofuture Platform, the Mission Innovation Bioenergy initiatives, and the Global Bioenergy Partnership (GBEP).

 What is the Significance of Global Biofuel alliance for India?

Increased Technology transfers to India- The transfer of technologies and mobilisation of international climate funds through the Global Biofuels Alliance (GBA) will help India to move faster in the compressed biogas sector and third generation ethanol plant capacities.

Help in achieving higher Blending of petrol with ethanol- India which has already achieved E-10 that is 10% blending of ethanol with petrol intends to achieve E-20 that is 20% blending of ethanol by 2025-26. However, we are still way behind Brazil which has achieved E-85. We can learn from Brazil through this platform of Global Biofuels Alliance (GBA).

Introduction of flex fuel vehicles in India- India can use the alliance and use Brazilian technologies for the introduction of Flex Fuel Vehicles, capable of running on a wide range of fuel blends, from zero to E85 (an ethanol-petrol blend containing 85 percent ethanol and 15 percent petrol). This would significantly reduce emissions and contribute to important savings in India’s crude oil import bill.

India at the centre stage of global climate action- Establishment of Global Biofuels Alliance will catapult India at the centre stage of climate action and reinforce India’s position in the fight against climate change.

Promotion of Biofuel exports- Today Brazil, US and India constitute 85% of global production of ethanol of which US produces 55%; Brazil produces 27% and India produces 3%. India can use the alliance to increase its share in biofuel production and can become a major exporting nation.

Greater energy independence for India-The establishment of the Global Biofuels Alliance (GBA) could assist India in achieving greater energy independence and reduce its reliance on foreign crude oil by promoting the increased utilisation of biofuels.

Reduction of Fiscal deficit and inflation-Crude Oil imports constitutes the highest component of our import bill. Higher crude oil and gas prices lead to higher inflation. Increased production of biofuels with the help of technology transfer from alliance members of Global Biofuels alliance would help us maintain fiscal prudence and lower inflation.

Increase in employment opportunities-Increased investments in the biofuel sector would create employment opportunities for thousands of youth and reap in rich ‘demographic dividend’.

Improvement of financial status of farmers- Increased use of biofuel has supported farmers with payments worth approximately USD 5 billion over the past eight years in the country. Farmers of sugarcane crop who are reeling under the financial burden of low sugar prices have been relieved of their financial burden through biofuels.GBA will help in further easing the farmer’s financial burden and doubling their income.

What are the challenges that Global Biofuels Alliance can face?

Transfer of Technology-US has generally been reluctant to share its technology with other countries. Global Biofuels Alliance (GBA) can also face this problem of ‘technological secrecy’ which may hamper its overall objectives.

Geopolitical contestation-China and Russia have been averse to any platform led by the western countries. Membership expansion may face the ‘Chinese hurdle’ as many countries are under the Chinese debt trap and their foreign policies are dictated by China.

Funds-The funding mechanism needs to be structured and put into place for ensuring sustainable financing of projects. With US experiencing recession and the global institutions like WB, IMF facing resource scarcity funds for Global Biofuels Alliance will be a major challenge.

Import restrictions on Biofuels- India has put import restrictions on import of biofuels in its National Biofuels Policy 2018. These import restriction policies are a major challenge for the development of global biofuels market. Global Biofuels Alliance faces a major challenge of removal of these inward-looking policies.

Environmental Concerns- As per Global Bioenergy Partnership (GBEP) report, one litre of ethanol from sugar requires about 2,860 litres of water and the growing demand for biofuels can change the cropping pattern and hit the crop basket.This would require huge amount of water and cultivable land areas and may make arid and water scarce countries of Africa averse to joining the alliance.

What is the significance of biofuels?

Global Biofuel Alliance will help in augmenting the production capacity of participating nations. Biofuels have several advantages which are enumerated below. Global Biofuel Alliance can help reap these advantages of biofuels which are mentioned below-

Environmental significance of Biofuels

Aid in fight against climate change- According to International Energy Agency (IEA) global biofuel production needs to be tripled by 2030 to put the world’s energy systems on track to achieve net zero by 2030. Biofuels lessen the global warming effect.

Decarbonisation of transportation sector- Blending of petrol with ethanol, use of biodiesel and Sustainable Aviation Fuel (SAF) reduces the emissions of greenhouse gases from transportation sector. Biofuels also help in reduction of emission of hazardous gases such as Carbon monoxide (CO) and sulphur oxide (SO).

Geopolitical Significance of Biofuels

Reduced dependence on OPEC and OPEC+- With increased usage of biofuels in blending dependence on fossil fuels like petrol and diesel is reduced. This reduces dependence of countries on the oil policies of OPEC and OPEC+.

Reduction of geopolitical contests for crude oil- In recent and past times, majority of the geopolitical contests like South Sudan crisis, gulf wars etc. were directly or indirectly linked to control of crude oil and gas resources. With reduction of dependence on crude oil resources due to biofuels these geopolitical contests and turmoil would be reduced.

Reduction of militarisation of energy supply routes- World today is witnessing heavy militirisation of ports and supply routes. String of Pearls Policy of China is one such example. With the use of Biofuels domestic source of fuel would be available, reducing need to secure supply lines of energy resources.

Economic Significance of biofuels

Saving lower- and middle-income countries from ‘debt trap’- The biggest component of import bill of lower- and middle-income countries of the world is the bill of crude oil and gas imports. Biofuels save nations from these‘debt trap’ phenomenon.

Open avenues for ‘new age energy enterpreneurship’- Biofuel sector has opened new avenues for investment and entrepreneurship.

Social Significance

Improve the socio-economic status of farmers- With increased demand for food stocks for biofuel production farmers get due compensation for even their damaged food crops. For example –In India increased use of biofuel has supported farmers with payments worth approximately USD 5 billion over the past eight years.

Development of Healthier population- With reduced pollution levels through the enhanced use of biofuels the population would be healthier. This would reduce the healthcare expenditure of developing countries of the world.

What are the other Initiatives for Increased usage of Sustainable Biofuels?

International Initiatives

 National Initiatives

What should be the way forward for Global Biofuels Alliance?

Should not be limited as a stagnant forum-Global Biofuels Alliance (GBA) forum should not be limited to being a stagnant platform. It should have specific goals to be achieved in the short and medium terms.

Focus on strengthening biomass supply chains- Global Biofuels Alliance (GBA) immediate objectives must be on strengthening the biomass supply chains.

Focus on technology transfer-Global Biofuels Alliance (GBA) must focus on efficient transfer of technology for the efficient production of second-generation ethanol from agricultural residue

Promotion of sustainable finance-Global Biofuels Alliance (GBA) must showcase pilot-scale production facilities for Sustainable Aviation Fuel (SAF) and promote sustainable financial support for bioenergy initiatives.

Global Biofuels Alliance (GBA) has the potential to become another successful platform like the International Solar Alliance (ISA) in the field of renewable energy led by India.