France Puts Tiger in Tank of its Biofuel Push
Date: 01-Mar-06
Country: FRANCE
Author: Muriel Boselli and Sybille de La Hamaide
Prime Minister Dominique de Villepin said France would also be defending the interests of farmers by launching a tender for 1.1 million tonnes of biofuel capacity by the end of the year, comprising 950,000 tonnes biodiesel and 150,000 tonnes ethanol.
This comes on top of a similar tender announced last year.
"We ought to defend and promote all new prospects for agriculture, including biofuels," de Villepin said at the annual Paris farm show. "We will therefore do more in this field."
Soaring oil prices have encouraged major consumers worldwide to sharply increase the use of biofuels, made from sugar cane, vegetable oils or grain and widely seen in the European Union as a way to reduce emissions of gases that heat the earth.
The European Union has encouraged a rise in biofuel production in the bloc, setting ambitious but non-binding targets for incorporating the new fuels into conventional fuels.
This is seen as a way to promote the image of farmers as protectors of the environment and to bolster farm prices.
Biofuels are split between biodiesel, largely made from rapeseed and then blended with diesel, and ethanol, made from sugar beet or cereals, and blended with conventional fuel.
The EU is the world's largest producer of biodiesel while Brazil leads in ethanol, followed by the United States. Within Europe, 2004 data shows Germany produced the most biodiesel, Spain led in ethanol and France was number two in both.
The new tender follows an existing tender for 1.8 million tonnes launched last year aimed at meeting France's target that green fuels account for 5.75 percent of all fuels by 2008, bringing forward an EU target date of 2010.
This quota attracted heavy bidding and has now been fully granted, Villepin said, leading to the construction of 10 new plants with an investment of one billion euros ($1.19 billion).
BIOFUEL TO EAT UP FOOD LAND
The 2008 target equated to an annual biofuel output of 3.2 million tonnes. With the new tender France would thus produce 4.3 million tonnes of biofuel by end-2010.
Villepin has said that after meeting the target of 7 percent biofuels by end-2010, he intends to hit 10 percent by end-2015.
French oilseed growers, quick to see a good opportunity, in 1993 set up their own company, Diester Industries, which has become by far France's main biodiesel producer with a production objective of 1.8 million tonnes by 2008.
The company predicts French biofuel output will use almost half of total oilseed production by 2008.
France's 2005 biofuel output was around half a million tonnes, of which 80 percent was biodiesel.
"By 2008 we will plant 1.5-1.6 million hectares of rapeseed and 600,000 to 700,000 hectares of sunflowerseed. Of this one million hectares will be used for biodiesel," said Diester Industries President Philippe Tillous-Borde.
By 2010, the total area sown in France to produce biofuels (biodiesel and ethanol) would be around two million hectares, French Farm Minister Dominique Bussereau said at the farm show.
It also will be a big help to the environment, he said.
"The commitments made by the Prime Minister will save seven million tonnes of CO2-equivalent," he said, referring to the cut in usage of conventional carbon-derived fuels.
French biodiesel makers said difficulties lay ahead.
"Now we have to live up to expectations, we have to start building. It's a challenge which will not be easy to realise," Tillous-Borde said.
Ethanol makers complained that they did not receive licences for all the tonnages they had bid for, which could put three of their current projects in jeopardy.