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Economic and Environmental Effects of the European Biofuel Policy

Author

Listed:
  • Rasetti, Michele
  • Ferreira, Joaquim B.S., Filho
  • Finco, Adele
  • Pena-Levano, Luis M.
  • Zhao, Xin
  • Opgrand, Jeffrey

Abstract

For many years, biofuels have been considered a cleaner, greener alternative to fossil fuels in order to reduce greenhouse gas (GHG) emissions in the transportation sector. For this reason, in recent years, many European policies has tried to promote biofuels production and consumption. However, some concerns on the actual sustainability of biofuels have arisen. In particular, scientific studies have pointed out that additional emissions from indirect land-use change (ILUC) could cancel out biofuels benefits on climate change. This paper analyzes the global economic and environmental consequences of an increase in biofuel production, as established by the RE Directive, for the period 2001-2020. The GTAP-BIO general equilibrium model was used for the simulation. The results suggest a total emission of 168 gCO2/MJ per year over 20 years of biodiesel production, which would mean that the GHG reduction requirements established by the policies could not be fulfilled.

Suggested Citation

  • Rasetti, Michele & Ferreira, Joaquim B.S., Filho & Finco, Adele & Pena-Levano, Luis M. & Zhao, Xin & Opgrand, Jeffrey, 2015. "Economic and Environmental Effects of the European Biofuel Policy," 2015 Conference, August 9-14, 2015, Milan, Italy 212489, International Association of Agricultural Economists.
    • Handle: RePEc:ags:iaae15:212489
    DOI: 10.22004/ag.econ.212489
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    References listed on IDEAS

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    Keywords

    Environmental Economics and Policy; Land Economics/Use;

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