Trade implications of the revised US and EU biofuel mandates

The risk of food insecurity in the form of higher food prices has prompted policymakers in the United States (US) and European Union (EU) to revise their approach to biofuel development. The US Renewable Fuel Standard (RFS) and EU Directive 2009/28/EC require long term use of renewable energy in transportation, subject to sustainability. This thesis examines the implications of the US RFS and EU Directive 2009/28/EC in a trade context using a partial equilibrium/comparative static framework. The focus is on the effect of the revised biofuels policies on opportunities for developing countries to supply the US and/or EU markets. For the US, the implications when the volume produced and/or required under the RFS is technologically infeasible with imports of ethanol as a potential policy alternative are explored. For the EU, the impact of the sustainability criteria on foreign biodiesel suppliers in terms of compliance cost is examined. In general, the US policy may enhance opportunities for trade while the EU policy will likely inhibit trade. A discussion of the implications of the mandates for developing countries and WTO is included

Industrial biotechnology for developing countries: The case for genetically modified biofuels in Kenya

Attempts to diversify the energy portfolios of developed countries with green technologies have brought competition between food and fuel for crop production resources to the forefront of public policy debates. Biofuel policies in the European Union (EU) and the United States (US) mandate the long-term use of renewable energy in transportation, independent of production capacity and technical feasibility. Both the US and EU policies explicitly allow for biofuel imports and, hence, have the potential to provide developing countries with export opportunities. For example, the EU is seen as a market that could be supplied with biofuels produced in Kenya. As a result, contentious land acquisitions have been made in Kenya to make way for sugar cane and jatropha cultivation for biofuel production. One potential means of improving the efficiency of Kenya’s agricultural sector is the application of transgenic technologies. The objective of this article is to assess whether a biofuel industry could be developed in Kenya, based on the use of genetically modified (GM) feedstocks to supply the EU demand for biofuel. This article concludes that GM agriculture will improve the economic returns for those Kenyan farmers willing to engage in the production of GM biofuel crops.Keywords: Barriers to trade, energy policy, genetically modified (GM) crops, international trade, land-use policyAfrican Journal of Biotechnology Vol. 12(15), pp. 1722-173