Bio Products Opportunity

I spent most of yesterday ashamedly not doing much work, at work. [As a personal aside, I really don’t like the feeling I get when i know i’ve wasted a day. The positive side effect is I did spend a lot of time reading interesting news sources and generally catching up on the details of current events.

Anyhow, back to my topic of the post. I’m a pretty regular reader of the Economist, but I’d never until yesterday, ventured in to their blog list. I recommend that you take a look. Its even more breif in its factual coverage than a lot of the articles, but the opinions are deeper and the comments cleverer and that’s what makes the reading fun. Readers can respond to posts or to articles from the main edition, and the authors will get back to them on this forum, making for some interesting interactions.

What caught my eye today was a short post on the effect biofuels have had on the price of food. Most readers will understand the food vs fuel dilemna, but the article the post references from The Financial Times is about the effect of the hike in prices on the UN World Food Programme. I have to confess that the impact of higher commodity food prices would affect UN food distribution hadn’t even crossed my mind until reading about it this morning.

I’ve already gone over on this blog some of my reticence about Biofuels/Biodiesel/Biomass as sources of energy and food vs. fuel is close to the bottom of my list of impacts I care about. Mostly, because as I understand it its not a problem of actual production, its a problem of subsidies. That is, something that could be resolved with better management of agricultural incentives. We can, and have, always produced too much commodity foodstocks, so there is room for biofuel feedstocks, the problem is that farmers are either paid to not produce (this is switching since the cost of feedstocks has now jumped high enough for it to be more profitable to plant than just get paid) and that prices have been artificially inflated by a lot of press and speculation. I predict, and this isn’t original at all, that before the end of the next growing cycle, prices will drop back down to a reasonable level. There is, quite simply, enough corn to go around, and there will be even more soon with all the planting people have done. Not to mention that the most common biofuel is actually sugarcane-based ethanol and not corn-based ethanol — and though we do eat sugar, there are a lot of other sources of it.

Whats striking to me is that the temporary hike in prices is having a pretty detrimental effect on the world’s absolute poorest — those that litterally cannot feed themselves. I think this plays into the North-South divide on climate change and environmental considerations in general. [For more on what “North-South” means, click here.]

Thats a big topic right there, one I’m not going to go into too much except to say that I’m often frustrated by the patronizing message of Northern environmentalists towards the South. I ascribe to the idea that it is MUCH more important for the South to be able to develop as cheaply as it can — in the long term that is the only way to resolve global environmental problems. For the record, I also don’t think coal is all-evil, and fighting coal plants is detrimental to development and to finding technological solutions to cleaning coal up.

Oh no, I’m slipping into a whole other post. I promise to write more on that topic, but for today, lets stick to Biofuels.

A couple of things caught my eye this week so I thought I’d write a weekly-roundup post rather than being specific to one topic:

1. US gas consumption as seen by the rest of the world:

I saw this chart on treehugger.com, it comes from the BP by way of the Economist. I’m a pretty visual person so I find the information depicted to be rather jaring. I think everyone understands that US gas consumption is high, in fact the highest in the world. Its quite another thing to see it contrasted to the amounts consumed in a large selection of other developed countries.

I also think that its only by making people see this kind of easily digestible very visual information, within a context of better understanding of life in other developed countries, will we possibly effect consumption patterns. The silver lining? At least the 2007 Energy Bill passed last month dictates a that American car makers must build cars with higher mpg rates.

2. Climate Change actually not so good for the Northeast United States:

I think the conversation on Climate Change is getting a bit lost in a all the optimisim of Live Earth and pessimism of complex IPCC announcements. This article from the New York Times outlining a recent report by the Union of Concerned Scientists brings us back to a look at the real impacts of Climate Change.

It seems to me that acceptance of freak weather patterns has started to enter into our daily dialogue and because of this people might be starting to loose track of what is so dangerous about Climate Change. Ah, so there are a few more storms — will adjust. This report points out that the risks are much higher with the real changes being major coastal flooding in the big cities of the Eastern Seaboard, massive enough changes in weather that cold winters wont happen anymore — having a huge impact on natural habitats, wildlife and the economy of New England, and a lot more. Basically, its good to keep in mind that Climate Change isn’t something we can just adjust too — it is likely to have huge, unrealisable and dramatic effects on some very essential elements of the world as we know it.

3. Now for something cheerier, How cool are these shoes?

I came across this company and I’ve decided I really like these shoes. I also don’t know for sure how really eco they are, but hey, fashion can be good sometimes. Check out www.simpleshoes.com

4. On a more personal note:

I went for a hike with a friend in Rock Creek Park this weekend. For those not familiar with Washington D.C., it is a surprisingly green city with a very well kept, pretty wild and large park cutting right through the middle of it. I happen to be staying this summer in a house that abutes the park making it easy to go for walks there.

Last weekend, odb showed me the beginning of a few trails and I thought I would give them a try. Now if only more city planners understood the immense value of something like a non-manicured park in an urban area. Buildings can be beautiful, but quick access to nature definitely offers something special as well.

Ah carbon offsets! Can you imagine life before them?

I find it particularly fascinating how a brand new term and concept has so easily slipped into the present reality of so many people. A year ago, even less for some people, very few people knew or understood what offsetting was or that they even had a carbon footprint. But within that time suddenly everyone wants to offset their entire life — travels, car, shopping, eating, farting… (yes you could theoretically offset your farts, they are methane after all).

So what is offsetting? How does it work? Who benefits? How do people make money from it? Is offsetting the same as trading?

The best article I’ve found in a while on the subject comes, unsurprisingly, from the Economist. The article explains how credit emissions are created and how they are priced and where they are traded. It also covers the sources of emissions and how they are being brought into the larger carbon offset market.

The author also provides a very good definition for what  the trade in carbon credit is about:

“The trade is not actually in carbon, but in not-carbon: in certificates establishing that so many tonnes of carbon dioxide (or the equivalent in other greenhouse gases) have not been emitted by the seller and may therefore be emitted by the buyer.”

There you go. This means that when you decide to offset your traveling you are in essence paying someone not to pollute for you. Its a nifty idea but does it actually happen?

This article dates back to March, but I think its a good snapshot of how carbon offsets work for the regular consumer.

[Treehugger.com is a good site for all sorts of up to date and relevant information and news on living a more sustainable life.]

I guess the question I’m left with, beyond the ones offered up in the Economist article on the workings of future carbon markets, is whether its really possible to just offset your life and keep living as we have for the past 150 years? I.e. could you just buy lots of relatively cheap — they are really affordable — and drive your fast car, fly to bermuda and not recyle?

The answer to that is probably no. Its not a zero sum game, its more like Commener’s closed circle. This offsetting business is offering us a nifty way to clean up our atmosphere, but for it to be really effective we do have to change our lifestyles. I’m not advocating for a radical change or that offsets aren’t a good idea. But a lot of the money that is getting poured into offsetting could maybe be better placed in developing new technologies that immediately reduce our carbon footprint.

This brings me to the current debacle in the Congress on upping CAFE standards.  Its been an interesting debate to observe, mostly because of the American car industry’s switch last week from full on misinformation campaign directed to keeping standards at the level they are now to a sort of half-hearted compromise.

The way the bill stands now by 2020 US car CAFE standards would increase to 35 mpg (currently at 25 mpg) with a 4% increase in mpg every year. The American auto industry (I specify American on purpose, Japanese and EU car makers are are already building cars with that level of mpg, it seems only Detroit lacks the techy know-how to catch up) changed its tack from all out opposition to support for an admendement to the bill. They are agreeing to the hike in CAFE standards but don’t want the 4% annual increase.

That kind of politics and lobbying makes me sick to my stomach. Some of the ads the car companies screened were full on misleading and pandered to American’s sense of fear. My personal favourite was one that went along the lines of “I want a safe car, not one with higher mileage” implying that you sacrifice safety for better mpg efficiency. I can read or hear that and think how misleading that is, but there are consumers out there who don’t see through the mixed messages and truly walk away thinking an SUV must guzzle to keep me safe.  Argh!!!

So back to what set me off down this road. Offsets are good, the markets are struggling but I think will work, however they are not a replacement for innovative technology and atmosphere-friendly choices.