Category: Clean Fuels for the Poor

The UK newspaper, The Independent’s online edition recently reported how jatropha curcas, the oil-bearing plant that has been touted as the remedy for our transport fuel woes of high prices and greenhouse gas emissions, is failing to live up to expectations. The non-edible plant has been promoted as currently the most sustainable source of biodiesel because it supposedly will grow just about anywhere, requires little water and needs little management. The Indepedent article, citing a report by the UK charity, ActionAid, says that actual experiences by farmers in developing countries growing the plant have shown poor results. Cultivating jatropha on poor soil yields low yields that provide no profits for farmers. In India, farmers were enticed to plant jatropha with the promise of a boom in demand but have found no buyer for their oil-bearing seeds. Similar articles have appeared at OneWorld UK. The Philippine government, in its alternative fuel program, has also promoted jatropha as an ideal biodiesel source (instead of expensive coconut oil) but has not progressed beyond experimental plantations and field tests and has built no infrastructure to support the industry.

The debate on the impact of industrial biofuels on the poor and on the climate continues. This is partly due to the EU directive that seeks to require that 10 percent of its transport fuels be sourced from renewable sources by 2020. Locally, the biofuels law already mandates a 5 percent biodiesel blend with producers clamoring to raise that to 10 percent. Such a law is an implicit subsidy on these more expensive fuels and forces motorists to use biofuels even if their supposed social and environmental benefits are are doubtful. ActionAid has two publications on the negative impacts of biofuels, particularly jatropha on farmers and food that may be accessed here and here . A Friends of the Earth report on jatropha in Swaziland is available here . More materials on contrarian views on biofuels are available on these organizations respective websites (ActionAid and Friends of the Earth ). These reports complement AER’s own report on biofuels development in the Philippines and the apparently minimal benefits on the poor farmers who supply the feedstocks.

The biofuels industry has so far not been kind to small producers. Romtron, the small, cooperatively-owned CME producer in Romblon, has had to cease production of CME as it desperately tries to find another buyer for its product. Another small player in the coco-methyl-ester (coco-biodiesel) field is Rasza Agro Produce Corporation (RAPCo) based in San Pablo City (Laguna). The family-owned enterprise has been in the coconut milling business for twenty-six years. It was put up by the father of the current proprietor and general manager, Mr. Romy Awayan, a mechanical engineer by training. The business started out by acquiring the waste fibers (called oil foots) that came through with the oil that is extracted by screw press expelling by coconut mills. These fibers still contained oil and were sold to smaller millers such RAPCo for whom further extraction was feasible. To press these foots, RAPCo developed its own small presses. The business expanded into buying fresh nuts and copra from traders as well as directly from farmers, and processing these in the larger expellers that it developed over time. The company sold its output of raw oil and copra cake to refiners and feed millers, respectively.

Synthesis

The global concern with regard to climate change, due in large part to the greenhouse gas emissions resulting from the use of fossil fuels particularly for transport, has spurred many countries to try to develop alternatives that have diminished negative environmental impacts. One course of action that has taken on much recent significance has been the rapid development of fuels from plants, commonly referred to as “biofuels.” In the Philippines, this innovation in alternative fuels is directed towards replacing imported petroleum fuel, which is seen as largely benefiting motor vehicle owners and
transport operators, in addition to claimed environmental benefits. However, the impacts of these fuels on groups at the base of the socio-economic pyramid, particularly small farmers and agricultural workers, are unclear. It is the goal of this study to examine such effects, determine the ways that this development of alternative fuels is affecting the welfare of such groups, and determining possible points of policy intervention so that socio-economic benefits are broadly diffused using a value chain analysis.