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Exploring Biodiesel Production in Brazil Exploring Biodiesel Production in Brazil A study on configurational patterns in an evolving policy domain S.L. Stattman, P.S. Bindraban & O. Hospes Report 199 Exploring Biodiesel Production in Brazil A study on configurational patterns in an evolving policy domain S.L. Stattman1, P.S. Bindraban2 & O. Hospes1 1 Wageningen University and Research Centre 2 Plant Research International Plant Research International B.V., Wageningen August 2008 Report 199 © 2008 Wageningen, Plant Research International B.V. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of Plant Research International B.V. Copies of this report can be ordered from the (second) author. The costs are € 50 per copy (including handling and administration costs), for which an invoice will be included. Plant Research International B.V. Address : Droevendaalsesteeg 1, Wageningen, The Netherlands : P.O. Box 16, 6700 AA Wageningen, The Netherlands Tel. : +31 317 48 60 01 Fax : +31 317 41 80 94 E-mail : [email protected] Internet : www.pri.wur.nl Table of contents page Abbreviations 1 Preface 3 Summary 5 1. Introduction 9 1.1 Biofuels policies in Brazil 10 1.2 Brazilian soy production 11 1.3 Problem statement: evolving policy fields 12 1.4 Research objectives 13 1.5 Research question 13 1.6 Concept definitions 14 1.7 Methodology 14 1.8 Structure of the report 15 Part I. Theoretical Framework 17 2. Evolving policy fields in the risk society 19 2.1 Governing in the risk society 19 2.2 Science in society 20 2.3 From scenario planning to reflexive governance 21 2.4 Legitimacy of governance 23 2.5 Concluding remarks 24 3. Shaping governance structures 25 3.1 The configuration approach 25 3.2 Criticism of the configuration approach 27 3.2.1 The role of discourse 28 3.2.2 Identifying actors through net-chains 29 3.3 Alternative views on governance 30 3.3.1 Political ecology: scaling perspectives 30 3.3.2 Power relations relating to social order 32 3.3.3 Views of nature linked to social order 34 3.4 Concluding remarks 35 4. Analytical tools and data collection 37 4.1 Integrated analytical framework 37 4.1.1 Mapping net-chains 37 4.1.2 Analysing discourse 38 4.1.3 Analysing power relations 38 4.1.4 Distinguishing configurational patterns 39 4.1.5 Analysing the shaping of governance 40 4.2 Data collection 41 4.3. Concluding remarks 42 Part II. Case Study - Biodiesel And Soybean Development 43 5. The role of soybean in the Brazilian biofuel programmes 45 5.1 Basics about biofuels 45 5.2 The biodiesel chain 47 5.3 Historical outline of Brazil’s ProAlcool programme 47 5.3.1 The ProAlcool policy process 49 5.4 The Agro-Energy plan 2006-2013 49 5.4.1 The National Biodiesel programme 50 5.5 Organisational aspects of the Biodiesel programme 51 5.5.1 Brazilian regions 52 5.5.2 The Social Fuel Stamp 53 5.5.3 Biodiesel tax model 54 5.5.4 Financial support programmes 55 5.6 Competitiveness of soybean oil for biodiesel production 55 5.7 The role of soybean 56 5.7.1 Soybean production 57 5.7.2 The soy chain 58 5.7.3 International soy trade 59 5.7.4 Controversies and sustainability initiatives 60 5.8 Concluding remarks 61 6. Reality definitions related to actor groups 63 6.1 Net-chain for the use of soybean as biodiesel crop 63 6.2 Actor perspectives 65 6.2.1 Reality definition of family farmers 65 6.2.2 Reality definition of producers 66 6.2.3 Reality definition of farmer cooperatives 68 6.2.4 Reality definition of extension services 69 6.2.5 Reality definition of product boards and vegetable oil traders 70 6.2.5 Reality definition of purchasers from food and feed industries 71 6.2.6 Reality definition of energy producers and distributors 72 6.2.8 Reality definition of ministries 73 6.2.9 Reality definition of regulatory councils of energy sector 74 6.2.10 Reality definition of automobile industry 76 6.2.11 Reality definition of research institutes and scientists 77 6.2.12 Reality definition of Non Governmental Organisations 78 6.2.13 Reality definitions of other actor groups 79 6.3 Concluding remarks 80 7. Configurations in the Biodiesel programme 81 7.1 The Biodiesel Programme as evolving policy field 81 7.2 Social dimension of the configuration approach 82 7.3 Cognitive dimensions of the configuration approach 83 7.3.1 Social pillar 84 7.3.2 Economic pillar 85 7.3.3 Environmental pillar 86 7.3.4 Technological pillar 87 7.4 Configurations on the role of soybean for biodiesel production 88 7.4.1 Configurational patterns 88 7.4.2. The role of other policy arenas 89 7.4.3 Human-environment interaction 90 7.4.4 Power relations as part of configurational patterns 91 7.5 Scenarios as outcome of configurations 91 7.6 Concluding remarks 92 8. Conclusions and recommendations 95 8.1 Main conclusions 95 8.2 Recommendations for a research agenda 97 References 99 Annex I. Itinerary 105 Annex II. PNPB laws 107 Annex III. List of visited organisations 109 List of figures Figure 1. Opportunities and risks with biodiesel production. 6 Figure 2. Soy and biodiesel production arenas. 6 Figure 1.1. Agroenergy matrix. 10 Figure 2.1. Interactive scenario planning. 22 Figure 3.1. Social Ordering. 32 Figure 3.2. Views of nature combined with views of society. 35 Figure 5.1. Simplified biodiesel chain. 47 Figure 5.2. Framework of the National Biodiesel Programme. 52 Figure 5.3. Mandatory blends per region to obtain the Social Fuel Stamp. 53 Figure 5.4. Shifting centre of soy production. 57 Figure 5.5. Simplified soy chain. 59 Figure 6.1. Integrated soy - biodiesel chain. 64 Figure 7.1. Soy and biodiesel production arenas. 83 Figure 7.2. Opportunities and risks with biodiesel production. 88 List of tables Table 4.1. Data sources. 42 Table 5.1. Characteristics of oleaginous crops in Brazil. 46 Table 5.2. Mandatory blends and market potential. 51 Table 5.3. Tax exemption per region, farmer, and crop. 54 Table 5.4. Demand for biodiesel production and total. 56 Table 5.5. Key dimensions of the RTRS. 60 Table 6.1. Number of farmers that receive technical assistance. 69 Table 7.1. Interaction patterns between actor groups. 82 Table 7.2. Configurations in the social pillar. 84 Table 7.3. Configurations in the economic pillar. 85 Table 7.4. Configurations in the environmental pillar. 86 Table 7.5. Configurations in the social pillar. 87 Exploring Biodiesel Production in Brazil A study on configurational patterns in an evolving policy domain Authors Name Sarah L. Stattman Institute Wageningen University and Research Centre Department of Social Sciences Chair group Law and Governance Chair group Environmental Policy Contact [email protected] +31 (0)317-483354 Site www.enp.wur.nl / www.law.wur.nl Name Dr. ir. Prem S. Bindraban Institute Plant Research International Team leader Natural Resources Contact [email protected] +31 (0)317-475946 Site www.pri.wur.nl Name Dr. ir. Otto Hospes Institute Wageningen University and Research Centre Department of Social Sciences Chair group Law and Governance Contact [email protected] +31 (0)317-483449 Site www.law.wur.nl Wageningen, July 2008 1 Abbreviations ABIOVE Brazilian Association of Vegetable Oil Industries ADM Archer Daniel Midlands AEP Agro Energy Plan 2006-2011 Amaggi André Maggi Group ANEC National Association of Grain Exporters ANFAVEA National Association of Motor Vehicle Manufacturers ANP National Petroleum Agency ANUT National Association for the Users of Freight Transport AproSoja Association of the Producers of Soy of the State of Mato Grosso B2 Blend of 2% biodiesel with diesel (the figure represents the percentage of biodiesel added to diesel, i.e. B20 consists of 20% biodiesel) BNDES National Bank for Economic and Social Development CDM Clean Development Mechanism CNP National Petrol Agency CNPE National Agency of Energy Politics COFINS Contribution for the Finance of Social Security CONAB National Supply Company DIEESE Department for Statistics and Socio-Economic studies EBDA Bahian Institute for Agrarian Development EU European Union GM(O) Genetically Modified (Organism) GTI Inter-Ministerial Working Group ha Hectare IAPAR Agricultural Institute of Paraná IPAM Institute for Environmental Research of the Amazon IPI Industrial Products Tax MAPA Ministry of Agriculture, Livestock and Food Supply MDA Ministry for Agrarian Development MME Ministry of Mines and Energy Mt Mega Tonne (1000 kilogramme) NEAD Center for Rural Studies and Rural Development NGO Non Governmental Organisation PCVDG Principles, Criteria and Verification Development Group of the RTRS Petrobras Brazilian Petroleum PIS Programme of Social Integration PNPB National Plan for the Production and Use of Biodiesel in Brazil PRONAF National Programme of Family Farming, for biodiesel RTRS Round Table on Responsible Soy SEBRAE Brazilian Service of Support for Micro and Small Enterprises SFS Social Fuel Stamp WTO World Trade Organisation 2 3 Preface The developments in the emerging field of bio-fuels are so fast that actual production of feedstock and biofuels are taking place while discussions on their effectiveness to curtail climate change and to provide environmentally friendly renewable energy are still ongoing. It is also highly questioned whether biofuels can create a promising opportunity for rural development in poorer regions and nations. Brazil is a frontrunner in the production of bio-ethanol and it the first country in the world to implement a national bio-diesel program with specific emphasis on enhancing rural development.
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