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A Causal Descriptive Approach to Modelling the GHG Emissions Associated with the Indirect Land Use Impacts of Biofuels

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A Causal Descriptive Approach to Modelling the GHG Emissions Associated with the Indirect Land Use Impacts of Biofuels A causal descriptive approach to modelling the GHG emissions associated with the indirect land use impacts of biofuels Final report A study for the UK Department for Transport November 2010 E4tech authors: Ausilio Bauen Claire Chudziak Kathrine Vad Philip Watson Contact: Claire Chudziak E4tech 83 Victoria Street London SW1H 0HW UK [email protected] Acknowledgements We would like to thank all interested parties who participated in the call for evidence and the stakeholder meetings. In particular we would like to thank our Expert Advisory Group: Uwe Fritsche (Öko-Institut), Warwick Lywood (Ensus), Siwa Msangi (IFPRI), Michael O’Hare (UC Berkeley), André Nassar (ICONE), Alex Nevill (Shell), Kenneth Richter (Friends of the Earth), Jannick Schmidt (2.-0 LCA Consultants/Aalborg University), Peter Smith (Cargill), Charlotte Smythe (HGCA), Richard Tipper (Ecometrica) and Jeremy Woods (Imperial College). In addition we would like to thank Robert Edwards (JRC), Nancy Harris and Jessica Chalmers (Winrock International), Anand Gopal (UC Berkeley), Sergio Schlesinger (FASE), Avery Cohn (UC Berkeley), the Defra Advisory Panel (and particularly Alan Swinbank) for their insights and feedback, as well as many other UK Government officials and researchers across the world, who have provided valuable insights to this report. i Contents 1 EXECUTIVE SUMMARY .......................................................................................................... 1 2 INTRODUCTION ....................................................................................................................... 4 3 THE CAUSAL-DESCRIPTIVE APPROACH TO INDIRECT LAND USE CHANGE ....... 6 3.1 General approach ................................................................................................................................ 6 3.2 Baseline and biofuel projections ......................................................................................................... 9 3.3 Methodology..................................................................................................................................... 13 3.4 Management practices for avoiding ILUC .......................................................................................... 30 4 PALM BIODIESEL .................................................................................................................. 31 4.1 Introduction ...................................................................................................................................... 31 4.2 Additional global demand for palm biodiesel in 2020 ....................................................................... 32 4.3 Market responses.............................................................................................................................. 32 4.4 Land use impacts and greenhouse gas consequences ........................................................................ 41 4.5 Scenario results ................................................................................................................................. 46 5 OILSEED RAPE BIODIESEL ................................................................................................. 49 5.1 Introduction ...................................................................................................................................... 49 5.2 Additional demand for oilseed rape biodiesel in Europe in 2020 ....................................................... 50 5.3 Market responses.............................................................................................................................. 50 5.4 Land use impacts and greenhouse gas consequences ........................................................................ 60 5.5 Scenario results ................................................................................................................................. 65 6 SOY BIODIESEL ...................................................................................................................... 68 6.1 Introduction ...................................................................................................................................... 68 6.2 Additional global demand for soybean biodiesel in 2020 .................................................................. 68 6.3 Market responses.............................................................................................................................. 69 6.4 Land use impacts and greenhouse gas consequences ........................................................................ 75 6.5 Scenario results ................................................................................................................................. 79 7 WHEAT BIOETHANOL ......................................................................................................... 82 7.1 Introduction ...................................................................................................................................... 82 7.2 Additional demand for wheat bioethanol in Europe in 2020 ............................................................. 83 7.3 Market responses.............................................................................................................................. 83 7.4 Land use impacts and greenhouse gas consequences ........................................................................ 91 7.5 Scenario results ................................................................................................................................. 96 ii 8 BIOETHANOL FROM SUGARCANE ................................................................................... 99 8.1 Introduction ...................................................................................................................................... 99 8.2 Additional global demand for sugarcane bioethanol in 2020........................................................... 100 8.3 Market responses............................................................................................................................ 103 8.4 Land use impacts and greenhouse gas consequences ...................................................................... 122 8.5 Scenario results ............................................................................................................................... 135 9 ACTIONS TO MITIGATE THE MAGNITUDE OF THE ILUC IMPACT ..................... 140 9.1 The need for ILUC mitigation ........................................................................................................... 140 9.2 ILUC mitigation actions ................................................................................................................... 141 10 DISCUSSION ......................................................................................................................... 146 10.1 The problem .................................................................................................................................... 146 10.2 The value of the exercise ................................................................................................................. 146 10.3 Modelling outputs ........................................................................................................................... 147 10.4 Managing risk .................................................................................................................................. 148 10.5 Further work ................................................................................................................................... 149 11 REFERENCES ........................................................................................................................ 150 ANNEX 1. DEMAND FOR FEEDSTOCKS IN THE BASELINE AND THE BIOFUEL PROJECTION .............................. 156 ANNEX 2. EMISSIONS FACTORS USED FOR PALM OIL ANALYSIS ............................................................ 158 ANNEX 3. BREAKDOWN OF THE PALM BIODIESEL ILUC FACTORS BY SCENARIO ........................................ 163 ANNEX 4. BREAKDOWN OF THE OILSEED RAPE BIODIESEL ILUC FACTORS BY SCENARIO .............................. 164 ANNEX 5. BREAKDOWN OF THE SOY BIODIESEL ILUC FACTORS BY SCENARIO .......................................... 165 ANNEX 6. BREAKDOWN OF THE WHEAT BIOETHANOL ILUC FACTORS BY SCENARIO .................................. 166 ANNEX 7. BREAKDOWN OF THE SUGARCANE BIOETHANOL ILUC FACTORS BY SCENARIO ............................ 167 ANNEX 8. PASTURE STOCK RATE CALCULATIONS FOR SUGARCANE ETHANOL CHAIN .................................. 168 ANNEX 9. OVERVIEW OF CAUSAL-DESCRIPTIVE MODEL ..................................................................... 170 iii List of Figures FIGURE 1. EXAMPLE OF A CAUSAL-DESCRIPTIVE APPROACH TO ILUC QUANTIFICATION. ............................................................. 7 FIGURE 2. OVERVIEW OF THE CAUSE AND EFFECT RELATIONS THAT CAN LEAD THE MARKET RESPONSES TO CAUSE LAND USE CHANGE. 15 FIGURE 3. OVERVIEW OF THE CAUSE AND EFFECT RELATIONS THAT CAN LEAD THE ADDITIONAL SUPPLY OF CO-PRODUCT TO CAUSE OR AVOID LAND USE CHANGE. .................................................................................................................................. 17 FIGURE 4. WHEAT GRAIN YIELD RELATIVE TO N FERTILISER SUPPLIED. ..................................................................................
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