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EU biofuel policies: income effects and lobbying decisions in the German agricultural sector

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  • Deppermann, Andre
  • Offermann, Frank
  • Puttkammer, Judith
  • Grethe, Harald

Abstract

European Union (EU) policymakers have persistently supported first-generation biofuels despite the clearly emerging picture of small or even negative ecological benefits. This leads to the conclusion that support is driven by other objectives, for example income effects. Against this background, the main objective of this article is to analyse the income effects of abolishing biofuel policies, as well as to explore the link between these effects and lobbying decisions taken by farmers’ associations representing different groups of German farmers. Income effects are estimated for different farm types and regions, and differences between farm net value added and family farm income are analysed. To understand the link between income effects and lobbying decisions, our quantitative results are compared with the biofuel policy positions of different farmers’ associations. Our results suggest that, in the long run, average income effects are small, especially if the ownership of production factors is accounted for in the income calculation. Many farms show losses, but others even benefit from lower rental costs and experience positive income effects. Farmers’ associations seem to be able to well assess the income effects of EU biofuel policy for different types of farms.

Suggested Citation

  • Deppermann, Andre & Offermann, Frank & Puttkammer, Judith & Grethe, Harald, 2015. "EU biofuel policies: income effects and lobbying decisions in the German agricultural sector," 2015 Conference, August 9-14, 2015, Milan, Italy 211570, International Association of Agricultural Economists.
    • Handle: RePEc:ags:iaae15:211570
    DOI: 10.22004/ag.econ.211570
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    2. Matthias Klumpp, 2016. "To Green or Not to Green: A Political, Economic and Social Analysis for the Past Failure of Green Logistics," Sustainability, MDPI, vol. 8(5), pages 1-22, May.
    3. Chiaramonti, David & Goumas, Theodor, 2019. "Impacts on industrial-scale market deployment of advanced biofuels and recycled carbon fuels from the EU Renewable Energy Directive II," Applied Energy, Elsevier, vol. 251(C), pages 1-1.
    4. Paladino, O. & Neviani, M., 2018. "A closed loop biowaste to biofuel integrated process fed with waste frying oil, organic waste and algal biomass: Feasibility at pilot scale," Renewable Energy, Elsevier, vol. 124(C), pages 61-74.
    5. Brinkman, Marnix L.J. & Wicke, Birka & Faaij, André P.C. & van der Hilst, Floor, 2019. "Projecting socio-economic impacts of bioenergy: Current status and limitations of ex-ante quantification methods," Renewable and Sustainable Energy Reviews, Elsevier, vol. 115(C).
    6. Zafeiriou, Eleni & Petridis, Konstantinos & Karelakis, Christos & Arabatzis, Garyfallos, 2016. "Optimal combination of energy crops under different policy scenarios; The case of Northern Greece," Energy Policy, Elsevier, vol. 96(C), pages 607-616.
    7. Philip Ulrich & Dr. Ulrike Lehr & Dr. Christian Lutz, 2018. "Gesamtwirtschaftliche Effekte der Energiewende in den Bundesländern – methodische Ansätze und Ergebnisse," GWS Research Report Series 18-5, GWS - Institute of Economic Structures Research.
    8. Ji, Xi & Long, Xianling, 2016. "A review of the ecological and socioeconomic effects of biofuel and energy policy recommendations," Renewable and Sustainable Energy Reviews, Elsevier, vol. 61(C), pages 41-52.
    9. Hloušková, Z. & Ženíšková, P. & Prášilová, M., 2018. "Comparison of Agricultural Costs Prediction Approaches," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 10(1).
    10. Kalkuhl, Matthias & Steckel, Jan Christoph & Edenhofer, Ottmar, 2020. "All or nothing: Climate policy when assets can become stranded," Journal of Environmental Economics and Management, Elsevier, vol. 100(C).
    11. Elina Bryngemark & Patrik Söderholm, 2022. "Green industrial policies and domestic production of biofuels: an econometric analysis of OECD countries," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 24(2), pages 225-261, April.
    12. Puttkammer, Judith & Grethe, Harald, 2015. "The Public Debate on Biofuels in Germany: Who Drives the Discourse?," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 64(04), December.

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