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International Conference on „Rural Development“ Lithuanian Agriculture University

Effects of Increasing Energy Costs, Food Prices and Support Schemes on the Feasibility of Energy Farming and Bioenergy Production. International Conference on „Rural Development“ Lithuanian Agriculture University Kaunas, 9.11.2007. Statement of Questions.

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International Conference on „Rural Development“ Lithuanian Agriculture University

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  1. Effects ofIncreasing Energy Costs,Food Prices and Support Schemes on the Feasibility ofEnergy Farming andBioenergy Production International Conference on „Rural Development“ Lithuanian Agriculture University Kaunas, 9.11.2007

  2. Statement of Questions Do increasingoilpricesaffectbiomassavailability? Source: OPEC (2007) Oil Prices (USD / bl) Years

  3. Statement of Questions Do increasingcommoditypricesaffectbiomassavailability? Source: ZMP (2007) Prices (EUR / t) Commodities

  4. Material and Methodology • LP - Modelling and Land-Use Simulation, since: • many activities and restrictions can be considered at the same time, • explicit and efficient procedures are provided for finding optimum results, • once formulated, results from changing variables can be easily calculated, and • new technologies or policy instruments can be easily incorporated by means of additional or modified activities in the models (Hazell and Norton, 1986).

  5. Scenarios on Oil Prices

  6. Scenarios on Oil Prices

  7. Region with intensive animal husbandry Cultivated Land (ha) Oil Prices (US-$/bl)

  8. Region with very intensive crop production Cultivated Land (ha) Oil Prices (US-$/bl)

  9. Region with small-scale and extensive agriculture Cultivated Land (ha) Oil Prices (US-$/bl)

  10. Region with large-scale and extensive agriculture Cultivated Land (ha) Oil Prices (US-$/bl)

  11. Conclusions • Competition between food and bioenergy production for scarce resources (e.g. land, water, etc.) will increase. • Differences between regions need to be considered. • Production of food crops will always achieve higher profit margins compared to biomass production. • Support schemes for renewable energies will hardly be able to outweigh this fact. • Oil price increases seriously affect the competitiveness of energy farming and the availability of biomass. • Economic risk from biomass price increases need to be kept in mind in planning processes in the future.

  12. Dr. Philipp Grundmann Dr. Hilde Klauss Leibniz - Institute for Agricultural Engineering (ATB) T.: +49 (0)331-5699-229 pgrundmann@atb-potsdam.de

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