Biofuels profits
FACED WITH a global crisis, a socialist system would
mobilise society’s economic and scientific resources to identify and
deal with the problem at hand. The focus and flexibility required comes
from the fact that socialism is based on the collective ownership of the
means of production with democratic control and management by
working-class people.
There would be networks of community and workplace
councils, regional and industry-wide bodies, national and international
conferences to decide courses of action. Representatives would be
accountable with the immediate right of recall and paid an average wage.
Decisions would be taken in the interests of the majority. Economic
development and use of the world’s natural resources would be planned
democratically in an environmentally sustainable way.
That is a stark contrast to the situation today
where human and natural resources are ruthlessly exploited in pursuit of
profit to the benefit of a small, unaccountable minority individually
owning and controlling production and distribution.
Despite years of warning, no decisive action has
been taken to tackle global warming which is driven by the greenhouse
gases emitted by oil-dependent capitalism. Innumerable summits have been
attended by jet-setting politicians, burning up the stratosphere and
spouting colossal amounts of hot air. Protocols have been proclaimed.
Undoubtedly, awareness has risen. So, too, has the earth’s temperature.
Capitalism searches for so-called ‘market
solutions’. A current favourite is biofuels. Biofuel is made from
blending conventional petrol with ethanol (eg from corn and sugar), or
adding to biodiesel (eg palm oil and soya). Waste products, such as
cooking oil and animal fat, can also be used.
In George W Bush’s state of the union speech this
year, he set an ethanol production target of 35 billion gallons by 2017
(five times current levels) and 60 billion in 2030. Robert Samuelson’s
op-ed column in the Washington Post (24 January) explained the
attraction: "The politics are simple enough. Americans dislike high fuel
prices; auto companies dislike tougher fuel economy standards. By
contrast, everyone seems to win with biofuels: farmers, consumers,
capitalists. American technology triumphs. Biofuels create rural jobs
and drain money from foreign oil producers. What’s not to like?"
Quite a lot, as it happens. The biofuels currently
on offer will not curb greenhouse gasses, will increase deforestation,
and strengthen the stranglehold of multi-national corporations.
The US government’s Energy Information
Administration says that in 2006 Americans used 315 billion gallons of
oil but that is projected to rise 30% to 411.6 billion in 2030. Because
ethanol has about two-thirds the energy value of petrol, Bush’s 60
billion-gallon target would offset less than half the projected annual
increase – around 40 billion of the 97 billion gallons. (The projections
are based on the population rising from 300 million to 365 million, and
from 225 million to 316 million vehicles.)
In the US, most ethanol comes from corn. Ethanol
receives heavy federal subsidies – 51 cents a gallon to refineries which
blend it with petrol. The subsidy is swelling oil company bank accounts
and has increased demand for corn, pushing up its price by 50% last
year. Corn is fed to animals, raising meat prices. So, fuel subsidies
mean more expensive food, hitting working-class and poor people
disproportionately hard. In 2000, ethanol used 6% of the US corn crop.
In 2006 that was 20%. That is set to double by 2010. The US imposes high
import tariffs on ethanol and subsidises US ethanol exports.
Iowa is the biggest corn-growing state in the US and
has 21 ethanol-producing plants, with more in the pipeline. If Bush’s
targets are reached, Iowa will be transformed from a world exporter of
corn to an importer – to feed the nation’s automobiles.
The environmental group, Friends of the Earth US,
estimates that ethanol reduces greenhouse gas emissions by 13% at best.
If production plants use coal to heat the corn, and many do, there is
little or no net benefit. The corn rush is adding pressure to cultivate
marginal land more at risk of erosion. Continuous corn crops – as
opposed to rotating land use – are more susceptible to weeds and
disease, increasing the use of pesticides or genetically modified crops.
Fertiliser use will go up, increasing nitrate pollutants in rivers.
George Naylor, an Iowan farmer, summed up the logic:
"Farmers do what they do too much of the time based on greed or fear,
which is not a good recipe for anything. If the emphasis is on corn to
produce ethanol, then that’s the way it will be. Everybody will pile in,
and I’ll be among them". (Guardian, 26 January) You can’t buck the
market.
The cheapest biodiesel feedstock (source material)
is palm oil. In Indonesia, Malaysia and elsewhere, tropical forests are
cut down and peat lands drained to clear space for plantations.
Deforestation is responsible for a quarter of the world’s carbon
emissions. Taking that into account, biodiesel from palm oil can create
more emissions than burning conventional diesel. Friends of the Earth
reckons that 87% of deforestation in Malaysia between 1985 and 2000 was
to make way for palm oil production. (Independent on Sunday, 6 May)
Goldman Sachs estimates that more than a quarter of
all available cropland would be needed for the British government to
meet its biofuel target from domestically grown crops. Therefore,
biofuel crops will be imported, contributing to deforestation elsewhere
and burning more fuel in transportation. The increase in biofuel
plantations in the neo-colonial countries will hit landless farmers,
rural and urban poor, and drive out peasants as multinationals take over
land and squeeze farmers by controlling the price paid to producers.
The international outcry against genetically
modified plants severely damaged the public image of this industry. The
fear that wild and non-GM crops will be contaminated and the ‘dependence
culture’ it imposes on poor farmers – forced to buy seeds and fertiliser
from multinationals – remains. Now, many in the industry hope that
biofuels can rehabilitate its reputation. Yet, some of the scenarios are
even scarier. One goal is to engineer reductions in the amount of lignin
in biofuel crops. Lignin blocks the process of turning cellulose into
ethanol. It is also what makes plants stand upright. What would happen
if there was significant cross-pollination? Would forests fall over?
Some people recognise the limitations of current
biofuels but argue that they are a step towards producing ethanol from
cellulose, the fibrous material in plants, which can be broken down by
enzymes into simpler sugars for fermenting into ethanol. Grasses are the
prime target. But the technology is still in its infancy, and the issue
of land use has to be addressed. After investing billions in refineries
to turn crops into biofuels, companies will not shut them down before
they have seen a return on their investments. The quick fix option is
the most attractive for capitalism, with research and development of
cellulose use pushed to the margins.
Today, "Thirty years after it was founded by
President Jimmy Carter, the National Renewable Energy Laboratory at the
edge of the Rockies here still does not have a cafeteria", and funding
is less than at the start of Bush’s presidency. Renewable energy
supplies only 6% of US energy needs, most of which comes from old
hydroelectric dams. Under current policy, that is set to rise to 7% by
2030. Coal use will increase from 23% to 26%. (New York Times, 25
January)
Royal Dutch Shell is conducting a massive PR
offensive to boost its green credentials. Over the last five years it
has invested $1 billion on biofuels, solar and wind power, and hydrogen,
one of the biggest such investments by any company. But it is less than
a fifth of what Shell invested with Chevron in one large oil-sand mining
project in Canada. Amy Jaffe, an energy specialist at Rice University,
said: "We are getting dirtier. If you need to come up with a fuel source
other than drilling for oil under the ground in the Middle East, what is
the most obvious thing with today’s economy, today’s infrastructure and
today’s technology? Oil shale, liquefied coal and tar sands. It’s all
dirty but it’s fast". (New York Times, 25 January)
That sums up the reckless, short-term outlook of
capitalism: worry about profit today and to hell with the future. The
approach of a socialist society to global warming is of long-term
sustainable development, cutting out the waste and duplication in the
profit system. It would divert massive resources into the research and
development of renewable energy sources. Marx and Engels famously wrote
that workers have a world to win. With capitalism hurtling blindfold
towards environmental catastrophe, the stakes are even higher. We have a
world to save.
Manny Thain
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