Report boosts North's biofuels firms

Jan 15 2008 by Karen Dent, The Journal

BIOFUEL firms in the North-East have broadly welcomed a report into the industry by the Royal Society, which says alternative fuels can play an important part in cutting greenhouse gases. However, the Royal Society’s study also said that the production methods used for certain biofuel crops could have a worse impact on the environment than fossil fuels do. The report stressed that in order to benefit the environment, biofuels must be grown and produced sustainably, without damaging natural habitats.

Prof John Pickett, who chaired the study, said: "One biofuel is not the same as another. The greenhouse gas savings of each depend on how crops are grown and converted and how the fuel is used. So indiscriminately increasing the amount of biofuels we are using may not automatically lead to the best reductions in emissions."

However, North-East biofuels businesses said the report’s findings were positive news for the region’s alternative fuel industry.

Sean Sutcliffe, the chief executive of Seal Sands-based biodiesel producer, the Biofuels Corporation, said: "Essentially the main message coming from that is that biofuels is a good thing as long as we do it properly. We absolutely support that and agree with the conclusion. I want the sustainability targets to be strongly enforced as soon as possible."

North-East entrepreneur Karl Watkin, whose business empire includes Middlesbrough-based D1 Oils which produces alternative fuels grown overseas from plants such as the jatropha curcas crop, also welcomed the Royal Society’s study.

"There is no question in my mind that biofuels have a major part to play in climate change and sustainable fuel development," he said. "However there is a very clear difference between D1 and jatropha, and palm oil. We have no interest in palm oil or rapeseed oil. Jatropha is a long-term solution."

Ian Waller, director of the NorthEast Biofuels cluster group of alternative energy companies, helped the Government develop the guidance for carbon reporting and sustainability for the Renewable Transport Fuel Obligation (RTFO), which comes into force in April. It requires that fuel suppliers must ensure 5% of fuels sold in the UK are from renewable sources by 2010. However, the Royal Society said the RTFO does not set greenhouse gas emission targets, which it believes would have encouraged the development of the most environmentally-friendly products.

Mr Waller said: "In the UK, we have been working on developing guidance for reporting green house gas (GHG) savings for a number of years now and it has long been recognised that different fuels offer different GHG savings. Indeed, all fuels offer different GHG benefits."

Matt Drinkwater, an analyst with New Energy Finance, said that the biofuels industry has for too long been painted either black or white. He said the report’s authors should be congratulated for taking the middle-ground.

"It was remarkably even-handed, which was good. The report really reflects the massive potential of the biofuels sector."

Meanwhile, EU Environment Commissioner Stavros Dimas has announced that European targets for switching to biofuels are being looked at again because of concerns about their impact. All stages of biofuel production - from clearing the land to grow them to the emissions from the machinery used to harvest the crops - are considered to have an impact on the environment.

Teesside is one the main biofuel producers in Europe and is also leading the way in the use of alternative energy sources. The Sembcorp Biomass power station at Teesside’s Wilton International manufacturing site near Redcar is powered by sustainable wood burning, while the Biofuels Corporation, D1 Oils and Tees Valley Biofuels are also located in the area.

See page two to read what the National Farmers' Union thinks about the Royal Society's report.