Identifying Pathways for Provision of Bio-Energy in SSA: Policy Issues

1. Identifying Pathways for Provision of Bio-Energy in SSA: Policy Issues Charles B.L. Jumbe, PhD (Econ) Centre for Agricultural Research and Development (CARD) Bunda College of Agriculture (University of Malawi) in partnership with WIP-Germany & FANRPAN funded by the EU __________________________________________________________________________________PPresented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5 September 2008 ___________________________________________________________________________________

2. Outline • Background • The COMPETE Project • The role of FANRPAN • Why do we need policies • Scope of Work on Policies • The approach • Key findings • The future • Way forward for FANRPAN • Take home messages ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

3. Introduction • Fossil fuels continue to be the pivot of economic and social development of all countries around the world • However, on-going debate is now centred especially around three main facets • Increasing prices currently reaching US$130 per barrel • Ensuring energy security - reducing dependence on imported liquid fuels from politically fragile states • Increased environmental concerns (GHG emission) and air pollution due to the burning of fossil fuels. • Therefore, biofuels are considered as an alternative to fossil fuels ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

4. The COMPETE Project • The Competence Platform on Energy Crop &Agroforestry Systems for Arid and Semi-arid Ecosystems – Africa • A 3-year project (2006-2009) funded to the tune of €1.5 mn by the EU under the 6th Framework Programme, Priority A.2.3: Managing Arid and Semi-arid Ecosystems • Objectives • to establish a platform for policy dialogue & capacity building • to identify pathways for the sustainable provision of bioenergy • to enhance the exchange of knowledge on biofuels development • Implementation • Through 7 WPs involving 41 institutions incl. FANRPAN ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

5. The role of FANRPAN • To produce outputs for the WP 6-Policy Development whose objectives are: • To develop & evaluate policy initiatives for bioenergy development in Africa • To develop a roadmap for policy research • To provide policy recommendations on how to harness the potential of biofuels without damaging livelihoods and the ecosystem • To share information from the policy work through seminars and workshops ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

6. Why do we need policies? • Global production of biofuels doubled over the 5 five years and is likely to double again in the next four years. • FAO (2007) predicts that demand for biofuels to grow by 170% in the next three years and to contribute 25% of the world energy needs in the next 15 to 20 years. ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

7. Sources of Growth • Brazil has set targets that all diesel contain 2% biodiesel by 2008 & 5% by 2013 • The EU target of 5.75% biofuels share in all transport fuel by 2010 means 18.6 mn. tons of oil equivalent of biofuels • Japan will need 6 bn. litres of ethanol every year to meet the blend ratio of only 3% biofuels. • China will need 22.7 mn. metric tonnes of biofuels to blend 10% biofuel into all Chinese cars by 2020. • Indonesia to increase its palm oil production from 64,000 sq km to 260,000 sq km by 2025. ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

8. Sources of Growth • The United States will use 28.4 billion litres of biofuels for transportation by 2012. • Across the US, 20% of the whole maize crop went to ethanol in 2006 to meet only 2% of automobile fuel use. • An extra 80 mn. acres (36 mn ha) of land will be required if maize ethanol alone will be used to meet the US target. • Eliminating gasoline use entirely in USA will require doubling the current 450 mn. acres (200 mn ha) of available for crop production- making it infeasible! ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

9. The BIG Question • How will these targets achieved? • Eyes are on AFRICA • Investors are coming to Africa to acquire land & put up plants and machinery for commercial biofuels production • About 4m sq km of land will be grown to energy crops in Southern Africa region (e.g., Jatropha) over the next 5 years ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

10. Scope of Work on WP 6 • To explore the extent to which the national development energy policies incorporate strategies for mainstreaming or supporting the development of the biofuel sector. • Key questions: • What do the national policies state with regard to bioenergy or biomass energy development? • What are the notable gaps in the policies across countries with regard to bioenergy and energy crops development? ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

11. Approach • PRSPs/national development frameworks • National energy policies • Specific biofuels strategies • National Trade Policies • Regional Development Frameworks (SADC, ECOWAS, COMESA) • International biofuels/trade policies (e.g., WTO, USA, EU & Asia) ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

12. Summary of key findings National Development/Energy Policies • Only the PRSP for Ghana contains specific strategies for biogas development, with a target of substituting 20% of national gas and oil consumption with biodiesel and 30% of paraffin to be replaced with Jatropha oil by 2015. • Mozambique has adopted a policy for large-scale production of biofuels, including the gradual introduction of blending of fossil fuels with biofuels initially at 5 – 10%. • South Africa has a specific biofuels strategy aims at achieving market penetration of 4.5% in biofuels by 2013. • Despite that Malawi has more than 20 years experience in bioethanol production-it has no specific biofuel strategy ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

13. Summary of key findings International policies • There is no clear WTO position on biofuels that may affect international trade in biofuels: • Biofuels classification within the context of the WTO harmonized system • How subsidies to promote the production or consumption of biofuels fit in the context of WTO rules, and • Consistency of domestic regulations and biofuels standards. ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

14. Summary of key findings Incentives • Substantial government support has been provided to many countries that have made significant progress in biofuels such as South African, USA and other countries in Asia & Europe • Implications • African biofuel sector is unlikely to be competitive on international markets due to • Subsides and tax incentives provided to producers & consumers of biofuels in developed countries • Law state of art in biofuel production & processing • High international standard specifications for biofuels • Lack of clear coherent supportive policy on biofuels ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

15. Caution! • While the consequences of biofuels on food supply remain uncertain, they cannot be ignored. • Biofuels may be sustainable in some instances but destructive in others. • If left unmanaged, biofuel production will put heavy burden on the poor in most countries in Africa • It is politically and socially immoral (insane) to transform all food into fuel for cars, yet many people go to bed hungry. • By taking food off of the table and use it to produce fuel for cars will make poverty in Africa worse since most people are net food buyers. ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

16. The “cost” of inaction • Despite the controversies surrounding biofuels and its effects on the poor, a “wait and see” approach will lead to • Food insecurity as more land will be taken away from mainstream agriculture for growing of energy crops • Damage to environment & loss of biodiversity through clearing of forests and/or encroachment of protected areas for biofuels • Missing out on opportunities of biofuels development • To most oil-importing countries, biofuels offers some relief on the fuel import bill in oil-importing countries ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

17. A grain of hope • Agriculture has always adapted to the changing needs of mankind- This should also be possible with biofuels. • If we slow down the pace, allow scientists and technologists to develop technologies that will • increase productivity of agriculture to meet growing global demand for both food and biofuels. • allow use of non-food feedstock to produce biofuels • A “happy ending” is possible only if agriculture can supply both energy & food needs ________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

18. In conclusion • As we now live in a global village, any significant shift in agriculture landscape in the industrialized world will heavily impact Africa. • Biofuels era is here to stay! As such, countries and everyone must face reality, and adjust accordingly in order to survive in the fast changing world • “It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change.” Charles Darwin (1809 – 1882) from “On the Origin of Species” (1859). ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

19. FANRPAN’s Niche • As biofuels are expanding rapidly in Africa, FANRPAN should be in the forefront: • RESEARCH- To support rigorous research & analysis to provide evidence-based responses to biofuel development • Better understand the direct and indirect impacts of bioenergy development on production systems. • Assess technical and policy options for both reducing the deleterious impacts and enhancing any benefits of biofuels development. ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

20. FANRPAN’s Niche • CAPACITY (POLICY ADVOCACY & DIALOGUE)-To provide guidance to governments on biofuels policy & guidelines that safeguards rural communities and the environment • VOICE-To sensitize politicians & civil society on the potential benefits as well as dangers of unregulated biofuels expansion • There will be a COMPETE Workshop on ‘Bioenergy Policies for Sustainable Development in Africa’ in Bamako, Mali from 25 to 28 November 2008 ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

21. Take-home messages 1. Human well-being & rights of every person at the centre of SSA biofuels strategies, policies, programs. 2. Policies urgently needed in SSA: • To protect the poor from exploitation by private interests at the expense of local livelihoods • To prevent from falling into the trap of replacing food crops with energy crops for producing fuel to power vehicles • To prohibit biofuels expansion to protected areas (e.g., forests, catchment suitable for of biofuels to rural development 3. Define the biofuels development path in SSA: • Smallholder focus for rural development (e.g. in Mali & Tanzania) other than commercial focus • Expansion beyond small-scale to be carefully controlled & monitored ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________

22. Thank you for your attention! charlesjumbe@yahoo.com ___________________________________________________________________________________ Presented at the FANRPAN Stakeholders Regional Policy Dialogue & Annual General Meeting Crossroads Hotel, Lilongwe, Malawi, from 1 to 5September 2008 ___________________________________________________________________________________