Red Alert on Green Fuel

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Tuesday, 20 January 2009

Canberra correspondent Bernard Keane writes:

The production and distribution of ethanol as an alternative motor
vehicle fuel source will increase greenhouse gas emissions over
 those generated by conventional fuels, research by the NSW
Greens has revealed.

The NSW Government has consistently cited the greenhouse benefits
of ethanol as one of the reasons for its decision to require that
fuel be 10% ethanol (E10) by 2011, and that 4% and then 6%
of fuel sold in 2009 and 2010 be E10.

The primary (and until recently dominant) producer of ethanol
 in Australia is Manildra, a major donor to the NSW Labor Party.
In 2006-07 alone, Manildra donated over $200,000 to the NSW ALP.
 Imports of ethanol were slapped with a punitive excise by the
Howard Government in 2002 at the behest of Manildra, which has
also donated generously to the Liberal Party. Ethanol excise
arrangements are currently under review by the Federal Government,
 and Resources Minister Martin Ferguson has criticised the NSW mandate.

The greenhouse benefits of biofuels have long been debated.
The then-Australian Greenhouse Office commissioned a study
by the CSIRO that indicated there was little difference in emissions
between E10 derived from molasses and premium unleaded. Data
from the International Energy Agency collated in a Masters thesis
 by grain merchant Dennis Ward suggests a 5% biofuel mandate
across the OECD -- that is, if 5% of all transport fuel in the OECD
 were replaced with ethanol -- the reduction in world greenhouse
emissions would be a quarter of 1%.

However, applications by Manildra to expand its facility at Bomaderry
on the NSW South Coast, and by other companies such as Agri Energy
and the Four Arrows Group to build new ethanol facilities at Condobolin,
Oaklands and Coleambally have provided a rare glimpse into the energy
 intensity of the ethanol production process, as companies have been
required to estimate greenhouse emissions as part of their project
Environmental Impact Assessments. Scott Hickie, adviser to NSW
Greens MLC Ian Cohen, has estimated that, on the companies' own
assessments, the proposed new ethanol facilities alone would add
up to 1.5% to net NSW greenhouse emissions -- an extraordinary
figure for a fledgling industry. At least four further plants have also
been proposed across rural NSW.

The figures include greenhouse credits assumed from the replacement
of petrol with ethanol. As Manildra itself states in its EIS for an upgrade
of its Bomaderry plant, which it is estimated will generate an additional
net 230,000 tonnes of CO2-equivalent a year, "the project will result in a
 net increase of greenhouse gas emissions, even when the downstream
reduction as a result of replacing petroleum fuels with bioethanol is taken
into account."

This is at odds with the statements by NSW Lands Minister Tony Kelly
 (christened "Minister for Ethanol" by Morris Iemma), who told NSW
Parliament last year "new transport fuels must also be capable of making
a significant contribution to reducing greenhouse gas emissions, and they
must not lead to unintended consequences, such as increasing the price
 of food. The New South Wales ethanol mandate gets this balance right.
" Announcing the new mandate in December with Kelly, Environment and
Climate Change Minister Carmel Tebbutt said "we need to embrace bio
fuels in a sustainable way, but acknowledge their contribution to reducing
greenhouse gas emissions."

Manildra itself is less reticent about the link. Its subsidiary Shoalhaven
Starches, which runs the Bomaderry facility, said in July 2008 that
"the use of ethanol as a fuel or fuel additive has many benefits: it is a
renewable fuel and lessens reliance on fossil fuels; it reduces greenhouse
gas emissions and other air pollutants..."

Kelly’s office today said that, while its advice was that biofuels contributed
 to reducing greenhouse gas emissions, they were not a silver bullet
solution to climate change. The purpose of the mandate was to establish
a foundation and a framework that provided the market with a platform and
 the incentive to produce a range of biofuels.

Greenhouse emissions aren’t the only area where ethanol has been
oversold. When Morris Iemma committed at the 2007 NSW election to a
10% ethanol mandate by 2011, he declared it "a win for the environment".
 In fact, Manildra has been a repeat offender when it comes to breaching
environmental requirements. Only in July, Shoalhaven Shire Council served
a Prevention Notice on Shoalhaven Starches for the discharge of industrial
 waste into the sewage system.

NSW Environment Department records (searchable here) show the
company has failed to comply with environmental requirements
(including minor ones relating to monitoring) on hundreds of occasions in
recent years. By way of comparison, the Caltex petroleum refinery at Kurnell
 in Sydney has had only a handful of non-compliance reports. Manildra’s
 representatives did not return Crikey’s calls by deadline.

The E10 mandate will also have a major impact on water usage. The 2.5m tonnes
 of grain required each year to produce the ethanol necessitated by a NSW
E10 mandate will see up to 10 ethanol plants across NSW, all trying to source
grain from reliable suppliers. Barring a massive increase in rainfall across the
 Murray-Darling Basin, this means irrigation, further skewing the MDB water
 market already heavily over-allocated and still subject to
 State Government distortions.

None of this is news to the NSW Government. It is understood that the E10
mandate is strongly opposed by many inside the NSW bureaucracy.
 The NSW Labor Party, however, continues its strong support for the industry.

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Re: Red Alert on Green Fuel
quit cross posting your crap tosser.

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