Biofuels not main player in the food price heist
The painful spike in prices of basic foodstuffs, from wheat and corn, to vegetable oils, rice and meat, has prompted some in the media and politics, normally uninterested in renewable energy, to call for the abandonment of government policies encouraging use of biofuels. The charge that the growth of biofuels output has taken land away…
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In response to the question "What can central banks or political leaders do to fight imported inflation?” German Macro-Economist Gustav Horn said: "In the short term, nothing. We have no control over the rising prices that originate abroad. We have no control over China’s explosive increase in energy demand. What we need are massive investments in renewable energies and new technologies to reduce our dependency on oil. That’s the only way to ensure stable prices in the long term.”

The UN Environment Programme (UNEP) in co-operation with UK-based New Energy Finance on 1 July 2008, released its report on Global Trends in Sustainable Energy Investment 2008. The report shows that over USD 148 billion in new funding entered the sustainable energy sector globally in 2007, up 60% from 2006. The executive summary is available as well in French, Chinese, and Japanese. The report is endorsed by REN21 and is financially supported by the German Environment Ministry and the United Nations Foundation.
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As in the previous year, the UNEP report shows that favourable policies are driving investment in sustainable energy. According to Yvo de Boer, Executive Secretary of the United Nations Framework Convention on Climate Change, “the positive trend in the renewable energy market is at least in part a business response to a policy expectation. If that expectation is not met, the conventional bottom-line will be the main driver for investment decisions.”

Is that policy expectation being met?

At the global level it’s doubtful. The G8 Hokkaido Summit held in July made little headway in that direction. It neither helped boost the climate change negotiating process, nor did it promote renewable energy. The Group of Eight countries agreed to adopt a (non-binding) global goal of at least 50% reduction of the world’s total greenhouse gas emissions by 2050 (though no base year was specified). However, leaders did not say how those cuts should be reached. More critically, they did not provide intermediate targets for 2030, which are key if the climate negotiating process is to move forward.

On energy, the Group of 8’s Declaration on Environment and Climate Change makes rather weak reference to renewable energy in paragraph 27, with no mention of goals or plans: “We recognize the important role of renewable energy in tackling climate change and in the long term reducing our dependency on fossil fuels.” In paragraph 35, however, leaders are more concrete when they “…note the significant progress made by the multilateral development banks on the Clean Energy Investment Framework (CEIF) agreed at Gleneagles …and call upon these Banks to build on the CEIF to develop comprehensive strategies to guide the integration of climate change into their development work and to set specific targets for low carbon investments like renewable energy."
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 The summit took place at the peak of the controversy over biofuels due to their alleged contribution to increased food prices. Just before the summit, news caused a stir about a reportedly “secret” World Bank report showing biofuels to be responsible for 75% of the price rise. The World Bank later clarified this was simply an internal working paper – and published it.
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More officially, the World Bank had proposed to the G8 Hokkaido-Toyako summit a 10-point plan on how to adapt to the “double jeopardy” of high food and fuel prices. Among other things, it suggests to increase aid in support of agriculture in developing countries and to “re-examine” biofuels policies in G8 countries, especially with regard to subsidies for maize/ethanol-based biofuels in the US and Europe.
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In the midst of the biofuels debate, EU environment ministers had in early July come to an understanding that the 10% target need not necessarily refer to biofuels only, but could in fact include any form of renewable energy. Electricity or hydrogen used in cars could contribute to the target, as long as they are derived from renewable energy.
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As the debate on biofuels continues: the European Commission has launched a consultation among all interested stakeholders to get their views on the need for a ‘Biomass for Energy Sustainability’ scheme, and specific key principles and criteria to be developed at EU level.
Questionnaire

Looking beyond the immediate next steps and towards 100 percent renewable energy in Europe, the European Greens are envisaging the establishment of a “European Renewable Energy Community” (ERENE) to counterbalance the age-old EURATOM community.
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In the US the Bush administration has just turned down a request from Texas Governor Rick Perry to cut the federal quotas by half for corn ethanol in the nation’s fuel supply. Perry has argued that rising U.S. ethanol output was inflating corn prices and Americans’ food bills and was harming the State´s livestock producers. The Environmental Protection Agency claims that no economic harm could be proven. The debate on biofuels will continue throughout the US presidential campaign, as the (presumed) contenders have opposing positions, with Barack Obama supportive and John Mc Cain sceptical of corn subsidies.
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Other policy trends in the regions

ASIA
When fuel prices skyrocket, fuel price subsidies become a financial burden to national budgets. After leaving domestic fuel prices unchanged for several months, China surprisingly announced it would increase fuel prices by up to 18%. China joins the list of Asian countries trying to get soaring subsidy bills under control, including India, Indonesia and Malaysia, who were also forced to raise prices to adjust to world market pressure.
Every two weeks, GTZ fuel price news keeps you updated with selected articles related to fuel prices and taxation, subsidies and energy demand from all over the world.
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On the renewables side, wind power growth in China is exceeding government expectations. The original goal of 5 GW was reached three years ahead of schedule, making it necessary for policymakers to double their wind power prediction for 2010. Since 2005, the country's wind generation capacity has increased by more than 100% a year. The government's renewable energy policy aims to procure 15% of the country's energy from non-carbon sources by 2020, twice the proportion of 2005. South Korea has revised it feed-in tariff for solar power, reducing it by 37%, but raising the cap 400% to 400MW. According to New Energy Finance, project installation is booming and domestic equipment production set to grow, but there are concerns about potential legislative barriers to foreign competition to Korea’s manufacturers.
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In Japan the Ministry of Economy, Trade and Industry has announced plans to resume financial support for residential and commercial use of solar power.
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Meanwhile, the Institute for Sustainable Energy Policies (ISEP) has joined forces with seven other renewable energy organisations to form the Japan Renewable Energy Policy Platform (JREPP) to undertake research and make policy proposals.
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AUSTRALIA
Feed-in laws and tariff schemes are increasing in Australia. At May 2008, feed-in laws had been passed in Queensland, South Australia and the Australian Capital Territory. The Tasmanian Government is considering a scheme while New South Wales, Western Australia and the Northern Territory are not currently considering tariffs.
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In Queensland the Solar Bonus Scheme (Feed-In Tariff Scheme) commenced on 1 July 2008. Customers participating in the scheme will be paid 44 cents per kilowatt hour for surplus electricity fed into the grid.
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New Zealand and the US have launched the International Partnership for Energy Development in Island Nations (EDIN) to further the development of energy efficient and renewable energy technologies on island nations and territories. EDIN will be primarily project-based, and will bring together policy leaders, technical experts, and financial leaders of island nations to develop guidance to advance clean energy development and deployment in specific regions and islands.
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AFRICA
In Africa governments seem to be developing a taste for sugar-based renewable energy: Mauritius, Malawi and Kenya are taking policy steps to move ahead on biofuels.

But in the face of a looming power crisis, Kenya is also keen to develop its huge geothermal potential.
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Senegal’s holding a high-level International Conference on Renewable Energy in Africa further underscored the growing interest in renewables on the continent. The conference, which was supported by the German Development Ministry and UNIDO, produced the “Dakar Declaration”, in which participants envisage a “Plan of Action” to scale up renewables on the continent.
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EUROPE: Feed-in tariffs in the news
In June, Germany’s Parliament passed its "Climate Package”, which aims to save 250m metric tons of CO2 by 2020, with renewables contributing to 30% of electricity production. The package includes an amendment to the Renewable Energies Sources Act (EEG) calling for a higher feed-in tariff for wind energy. The tariff for solar PV will decrease between 8 and 10% in 2010 and then 9% annually after 2011. The decreasing tariffs for solar PV demonstrate to investors that Germany is making significant progress in reducing the cost of generating electricity from PV sources, which will reduce the need for subsidies to attract investment.
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In Spain government officials have announced plans to reduce the subsidy for solar PV by about 75%. The country has been debating changes for the last few weeks, and it appears that it may choose to cap its current subsidy program at 300 megawatts, 200 MW for rooftop systems and 100 MW for ground-mounted systems, which have been the highest growth area. Cuts apparently will not apply to solar thermal power (CSP).
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In the UK a new study demonstrates that there is no need to increase non-renewable generation capacity until after 2020 if the country was simply to achieve its renewables and energy efficiency targets. Produced by Pöyry energy consulting firm and commissioned by the UK branches of WWF and Greenpeace, the report underlines the need for policymakers to pave the way., Low-carbon options are also presented. for the post 2020-period.
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A first step was taken by Prime Minister Gordon Brown in June, when he presented the UK’s Renewable Energy Strategy. The strategy, which embraces the 15% target proposed by the European Commission, was welcomed by the industry. The government has opened a consultation process online.
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France has taken over the presidency of the European Union, which will last from July to December 2008. Renewable energies are high on its agenda. The 2008 Renewable Energy Policy Forum will be held in Paris in November.
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UNITED STATES
Former Vice-President and Nobel Prize winner Al Gore has challenged the US to commit to producing 100% of its electricity from renewable energy sources such as solar, wind, and geothermal power by 2018.
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On 25 June 2008, the California Solar Initiative released the latest data on PV projects in its planning pipeline that have filed for state rebates. The pipeline now totals 213MW, representing a total investment of USD 1.5bn. To date, the scheme has overseen 339MW of residential and commercial PV installations, with 81MW installed in 2007 and 59MW so far this year.
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The US Senate once again failed to pass legislation that would extend renewable energy and energy-efficiency tax credits. The “yes” votes were nine short of the required 60, and 43 members opposed the bill. The vote was for an eight-year extension on solar-power tax credits, and a one-year extension for wind power credits, among other things.
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USA Press conference for WIREC pledges, report
On 22 July, 2008 - As a follow-up to the successful Washington International Renewable Energy Conference (WIREC 2008), the United States today announced the launch of the WIREC Conference Report.
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Worlds largest economies have enormous renewable energy potentials
REN21 is pleased to release its summary report on Renewable Energy Potentials: Opportunities for the Rapid Development of Renewable Energy in Large Economies, its Impacts on Sustainable Development and Appropriate Policies to Achieve it. The study was prepared as input to the Gleneagles Dialogue on Climate Change and is based on assessments by selected experts and on comments from participants in the REN21 network. The German Federal Ministry for the Environment (BMU) commissioned and financed the report.
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Also on the REN21 website:
 

• The Virtual Library continues to grow as a choice selection of publications and book reviews. Recently added: "Market introduction perspectives of innovative technologies supporting integration of RES-E - Final Report" and also “IEA Energy Technology Perspectives”
• The Event Calendar features events on renewable energy policy, such as the "Global Wind Power 2008" taking place in Beijing in October.
• A new section on the website, the Community Pinboard, allows individuals and institutions active in renewable energy policy to 'pin' announcements on the front page of the REN21 website for a certain period of time.

Produced by REN21 Secretariat.

Disclaimer
REN21 newsletter creates dialogue to emphasise the importance of renewable energy and to generate discussion on how they can be promoted. While the website benefits from the contributions of the REN21 community, the views expressed are those of the individual authors identified as the originators. They are not necessarily those of any of the other contributors, or any partner, sponsor or endorsing body of the REN21 Network.