Promoting Biofuels: Implications for Developing Countries
AbstractInterest in biofuels is growing worldwide as concerns about the security of energy supply and climate change are moving into the focus of policy makers. With the exception of bioethanol from Brazil, however, production costs of biofuels are typically much higher than those of fossil fuels.As a result,promotion measures such as tax exemptions or blending quotas are indispensable for ascertaining substantial biofuel demand.With particular focus on developing countries, this paper discusses the economic justification of biofuel promotion instruments and investigates their implications. Based on data from India and Tanzania, we find that substantial biofuel usage induces significant financial costs. Furthermore, acreage availability is a binding natural limitation that could also lead to conflicts with food production.Yet, if carefully implemented under the appropriate conditions, biofuel programs might present opportunities for certain developing countries.
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Bibliographic InfoPaper provided by Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen in its series Ruhr Economic Papers with number 0038.
Length: 20 pages
Date of creation: Jan 2008
Date of revision:
Other versions of this item:
- Peters, Jörg & Thielmann, Sascha, 2008. "Promoting biofuels: Implications for developing countries," Energy Policy, Elsevier, vol. 36(4), pages 1538-1544, April.
- O38 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Government Policy
- Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
- Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
This paper has been announced in the following NEP Reports:
- NEP-AGR-2008-04-15 (Agricultural Economics)
- NEP-ALL-2008-04-15 (All new papers)
- NEP-DEV-2008-04-15 (Development)
- NEP-ENE-2008-04-15 (Energy Economics)
- NEP-ENV-2008-04-15 (Environmental Economics)
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