1 Michael OHare Goldman School of Public Policy University of California, Berkeley Land Use Change and Biofuels Policy EEA Expert meeting Copenhagen June

2 LCA/CTW Considering any two exclusive policies/practices A and B: How will* the world be different in the future under A compared to under B? –Things with money prices, and things not traded in markets –Things we can easily see (tractor fuel on corn farm), and things hard to see (soil and plant C sequestration, N cycle) –And things we cant see at all: faraway land use change effected through worldwide food markets What do we count? How do we measure them? How do we weight them into a scalar measure of merit? *Not, how might it be different under imaginable policies etc.

3 What could we do with LCA results if we had them? Regulatory decisions on specific fuels Guide research and subsidy investments Direct attention on ways to improve Support NGO pressure and lobbying Highlight need for related (non-GW, extra- territorial) policy changes There is no unitary decisionmaking authority for any of this: we is a vague and mushy concept Different uses imply different measures and methods (as Bart & Pierpaolo pointed out).

4 Green in regulation Not a direction, hope, or general quality Must be expressed numerically, with – Financially consequential results AFCI score yes/no acceptability –Court review

5 LCFS liquid fuel concept + += = If this is a biofuel, how green is it?

6 LCFS in practice For producer j in year t who blends Q i units of fuel with GHI index G i, the fine (or sale of credits) when the standard is S t will be: Policy implementation comprises (mostly) establishing operational definitions for these variables. Direct LCA

7 LCFS in practice For producer j in year t who blends Q i units of fuel with GHI index G i, the fine (or sale of credits) when the standard is S t will be: Policy implementation comprises (mostly) establishing operational definitions for these variables. Direct LCA

8 Fuel Lessfood, lessmeat HigherYields (intensity) OverseasLUC DomesticLUC Sharesdeterminedby pricesandelasticities Displaced food crops induce land use change far from biofuel growing area

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10 From Searchinger 2008

11 Net energy and net GHG estimates for 6 studies of corn ethanol, as well as 3 cases. Gasoline is shown for reference. The cellulosic case is switchgrass grown on prime crop land. Adapted from - Farrell et al, 2006 What we found without Land Use Change

12 Considering land use change (LUC) Net energy and net GHG estimates for 6 studies of corn ethanol, as well as 3 cases. Gasoline is shown for reference. The cellulosic case is switchgrass grown on prime crop land. Adapted from - Farrell et al, 2006 and Searchinger et al, 2008 iLUC is very large for biofuels grown on cropland! LUC with linear derating

13 Key points It doesnt matter what the biofuel crop is (except for yield) It doesnt matter where you grow it (as long as its on land that could grow food) The effect goes both ways (cropland returned to natural) Other processes (food demand, BAU yield increases, etc.) are secondary Previously cultivated land provisions (US, Germany, RTFO, Indonesia) are inconsequential.

14 How big is this? How long is this? LUC for this? How big is this? How to count this? How to count this?

15 GHG intensity Gasoline Prior Is the GHG intensity of a biofuel an RV with a PDF? If so, what statistic should be used for its GHG index in a regulatory context? What does the cost-of-being-wrong function look like? Bayesian posterior P(GWI) < Gasoline

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17 UC Current Work Model uncertainty in iLUC* Model iLUC with GTAP –Preliminary results not very different from Searchinger results Meta-analysis of iLUC estimates –Other models? (EPA forthcoming) Model uncertainty in direct LCA Account properly for time* Sustainability in the LCFS context* *see slides to follow

18 (Draft) Monte Carlo Analysis of Searchinger: Plevin & Jones

19 How big is this? How long is this? LUC for this? How big is this? How to count this? How to count this? What about coproducts?

20 What about time? Searchinger (and others) do not discount Discounting is a complicated issue: –Economic discounting of events involving goods traded in markets –Derating of physical phenomena: how do we value a ton of C reduction after the Greenland ice cap is in the ocean compared to a ton after? Some effects are irreversible. Any recognition of time value increases currently estimated deficits of crop biofuels relative to fossil fuel.

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22 Simple linear derating increases i LUC contribution to crop biofuel GW index (relative to gasoline) by about a factor of two.

23 Other considerations for crop biofuels Industrial monocrops Biodiversity, economic diversity Capital intensive, low-wage labor Biofuel curse? Water Etc. Sustainability comprises a variety of non-GW issues

24 Sustainability is [are] another whole can of worms! Assessment of effects Association with batches of fuel Local enforcement capacity Commensuration Application in a regulatory environment with real $ consequences and court oversight WTO rules Goal creep: LCFS is a GW policy

25 Whats left? From waste: ~8% of gasoline –Enzymes to crack cellulose –Thermal gasification + microbes + membrane separation (eg, Coskata) –Mass burn Mixed perennials, oil plants on waste land Cane, variousols Algae: too soon to tell, but very expensive now. Must be on desert (closed system) or open water.

26 Thanks! Erin Palermo Rich Plevin Sabrina Spatari Dan Sperling Brian Turner Sonia Yeh …and CMU Alex Farrell Mark Delucchi CARB Kevin Fingerman Andy Jones Dan Kammen