1 michael ohare goldman school of public policy university of california, berkeley...
TRANSCRIPT
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Michael O’HareGoldman School of Public PolicyUniversity of California, [email protected]
Land Use Change and Biofuels Policy
EEA Expert meetingCopenhagen June 10 2008
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LCA/CTW • Considering any two exclusive policies/practices
A and B:• How will* the world be different in the future
under A compared to under B? – Things with money prices, and things not traded in
markets– Things we can easily see (tractor fuel on corn farm),
and things hard to see (soil and plant C sequestration, N cycle)
– And things we can’t see at all: faraway land use change effected through worldwide food markets
What do we count? How do we measure them? How do we weight them into a scalar measure of merit?
*Not, how might it be different under imaginable policies etc.
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What could we do with LCA results if we had them?
• Regulatory decisions on specific fuels• Guide research and subsidy investments• Direct attention on ways to improve• Support NGO pressure and lobbying• Highlight need for related (non-GW, extra-
territorial) policy changes
• There is no unitary decisionmaking authority for any of this: “we” is a vague and mushy concept
• Different uses imply different measures and methods (as Bart & Pierpaolo pointed out).
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“Green” in regulation
• Not a direction, hope, or general quality
• Must be expressed numerically, with– Financially consequential results
• AFCI score• yes/no acceptability
– Court review
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LCFS liquid fuel concept
+
+ =
=
2010
2020
If this is a biofuel, how green is it?
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LCFS in practice• For producer j in year t who blends Qi units of
fuel with GHI index Gi, the fine (or sale of credits) when the standard is St will be:
tjttjt
jt
PQAFCISC
iLUCQGQGAFCI
...2211
Policy implementation comprises (mostly) establishing operational definitions for these variables.
Direct LCA
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LCFS in practice• For producer j in year t who blends Qi units of
fuel with GHI index Gi, the fine (or sale of credits) when the standard is St will be:
tjttjt
jt
PQAFCISC
iLUCQGQGAFCI
...2211
Policy implementation comprises (mostly) establishing operational definitions for these variables.
Direct LCA
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Fuel
Less food,less meat
Higher Yields(intensity)
Overseas LUCDomestic LUC
Shares determined byprices and elasticities
Displaced food crops induce land use changefar from biofuel growing area
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Time
GHG
3000
30
140
90
Ethanol withLUC
Gasoline
Physical GHGdischarge/uptake
30yr
Figure1:Physical dischargeof GHGand landusechange.Values roundedfromSearchingeret al.
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10From Searchinger 2008
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Net energy and net GHG estimates for 6 studies of corn ethanol, as well as 3 cases. Gasoline is shown for reference. The cellulosic case is switchgrass grown on prime crop land. Adapted from - Farrell et al, 2006
What we found without Land Use Change
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Considering land use change (LUC)
Net energy and net GHG estimates for 6 studies of corn ethanol, as well as 3 cases. Gasoline is shown for reference. The cellulosic case is switchgrass grown on prime crop land. Adapted from - Farrell et al, 2006 and Searchinger et al, 2008
iLUC is very large for biofuels grown on cropland!
LUC with linear derating
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Key points
• It doesn’t matter what the biofuel crop is (except for yield)
• It doesn’t matter where you grow it (as long as its on land that could grow food)
• The effect goes both ways (cropland returned to natural)
• Other processes (food demand, BAU yield increases, etc.) are secondary
• “Previously cultivated land” provisions (US, Germany, RTFO, Indonesia) are inconsequential.
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Time
GHG
3000
30
140
90
Ethanol withLUC
Gasoline
Physical GHGdischarge/uptake
30yr
Figure1:Physical dischargeof GHGand landusechange.Values roundedfromSearchingeret al.
+
How big is this?
How long is this?
LUC for this?
How big is this?
How to count this?
How to count this?
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GHG intensityGasoline
Prior
•Is the GHG intensity of a biofuel an RV with a PDF?
•If so, what statistic should be used for its GHG index in a regulatory context?
•What does the cost-of-being-wrong function looklike?
Bayesian posterior
P(GWI) < Gasoline
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UC Current Work
• Model uncertainty in iLUC* • Model iLUC with GTAP
– Preliminary results not very different from Searchinger results
• Meta-analysis of iLUC estimates– Other models? (EPA forthcoming)
• Model uncertainty in direct LCA• Account properly for time*• Sustainability in the LCFS context*
*see slides to follow
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18(Draft) Monte Carlo Analysis of Searchinger: Plevin & Jones
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Time
GHG
3000
30
140
90
Ethanol withLUC
Gasoline
Physical GHGdischarge/uptake
30yr
Figure1:Physical dischargeof GHGand landusechange.Values roundedfromSearchingeret al.
+
How big is this?
How long is this?
LUC for this?
How big is this?
How to count this?
How to count this?
What about coproducts?
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What about time?
• Searchinger (and others) do not discount• Discounting is a complicated issue:
– Economic discounting of events involving goods traded in markets
– “Derating” of physical phenomena: how do we value a ton of C reduction after the Greenland ice cap is in the ocean compared to a ton after? Some effects are irreversible.
• Any recognition of time value increases currently estimated deficits of crop biofuels relative to fossil fuel.
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Time30 yr
1.0
Discounting(5%)
Calamity
Horizon
Generic
Figure2:Possiblesocial cost of physical GHGrelease functions. Conventionaleconomicdiscountingis shownfor comparison (seetext)
tc
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Time
GHGreductionbenefit
3000
30
140
90
Physical GHGdischarge/uptake
30 yr
Figure3:Social benefit of reducingphysical dischargeof GHGincludinglandusechanges,withderatingaccordingto theGeneric function (seeFigure2).ValuesroundedfromSearchingeretal.
Simple linear derating increases i LUCcontribution to crop biofuel GW index(relative to gasoline) by about a factor of two.
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Other considerations for crop biofuels
• Industrial monocrops• Biodiversity, economic diversity• Capital intensive, low-wage labor• Biofuel curse?• Water• Etc.
“Sustainability” comprises a variety of non-GW issues
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“Sustainability” is [are] another whole can of worms!
Assessment of effectsAssociation with ‘batches’ of fuelLocal enforcement capacityCommensurationApplication in a regulatory environment with
real $ consequences and courtoversight
WTO rules“Goal creep”: LCFS is a GW policy
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What’s left?
• From waste: ~8% of gasoline– Enzymes to crack cellulose– Thermal gasification + microbes + membrane
separation (eg, Coskata)– Mass burn
• Mixed perennials, oil plants on waste land• Cane, variousols • Algae: too soon to tell, but very expensive now.
Must be on desert (closed system) or open water.
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Thanks!
Erin PalermoRich PlevinSabrina SpatariDan SperlingBrian TurnerSonia Yeh…and CMU
Alex Farrell
Mark Delucchi
CARB
Kevin Fingerman
Andy Jones
Dan Kammen