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Questioning the sustainability of Biodiesel: Final report - October 2005

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Listed:
  • Frondel, Manuel
  • Peters, Jörg

Abstract

Biofuels contribute to the mitigation of climate change. Directive 2003/30/EC thus aims at increasing the share of biofuels in total EU fuel consumption by up to 5.75 % by 2010. The rationale behind this directive can be found in potentially positive environmental impacts, most notably the reduction of greenhouse gas emissions, and by positive employment effects in the agricultural sector. This paper investigates the environmental, economic, and social implications of the support of rapeseed-based biodiesel as a substitute for fossil diesel. Based on a meta-analysis of recent empirical studies, we find clearly positive energy and greenhouse gas balances of this environmental strategy. Yet, the overall environmental balance of the substitution of rapeseed-based biodiesel for fossil diesel is currently far from being unequivocally positive. Our major finding is, however, that biodiesel is not a cost-efficient emission abatement strategy. When taking all economic, ecological, and social aspects into account, we conclude that Biodiesel is not a sustainable solution. We therefore suggest more efficient climate gas abatement strategies. Among these alternatives are synthetically generated biofuels that can substitute for fossil fuels in the future.

Suggested Citation

  • Frondel, Manuel & Peters, Jörg, 2005. "Questioning the sustainability of Biodiesel: Final report - October 2005," RWI Projektberichte, RWI - Leibniz-Institut für Wirtschaftsforschung, number 69922.
    • Handle: RePEc:zbw:rwipro:69922
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    References listed on IDEAS

    as
    1. Henke, J.M. & Klepper, G. & Schmitz, N., 2005. "Tax exemption for biofuels in Germany: Is bio-ethanol really an option for climate policy?," Energy, Elsevier, vol. 30(14), pages 2617-2635.
    2. Klepper, Gernot & Peterson, Sonja, 2004. "The EU emissions trading scheme allowance prices, trade flows and competitiveness effects," Open Access Publications from Kiel Institute for the World Economy 3270, Kiel Institute for the World Economy (IfW Kiel).
    3. Gernot Klepper & Sonja Peterson, 2004. "The EU Emissions Trading Scheme. Allowance Prices, Trade Flows, Competitiveness Effects," Working Papers 2004.49, Fondazione Eni Enrico Mattei.
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    More about this item

    Keywords

    Renewable Energy; Environmental Policy; Greenhouse Gas Emissions.;
    All these keywords.

    JEL classification:

    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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