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Box 3.3.2 Firm strategy for biofuels in China


In 2009 China produced 2 billion litres of biofuels, ranking the country third behind Brazil and the USA. The Chinese government has set ambitious targets seeing biofuels as not only contributing to the country’s rapidly expanding energy needs, but also as a way of providing rural employment. With China having 20 percent of the world’s population but only seven percent of its arable area, biofuels production is clearly constrained by land availability. However, a far more precious resource may be the most limiting factor yet: water.


Southwest China has seen large biofuels development partly sustained by access to large water reserves including two of the world’s great rivers – the Yangtze and the Mekong. Despite access to a more plentiful supply of water from these rivers there are concerns about the impact of mass cultivation of biofuels on water resources and quality. In the north, with only 14 percent of China’s water resources, the challenges related to biofuels production could be far more acute, according to the China Institute of Water Resources and Hydropower Research.


Water management is an increasingly difficult balancing act between electricity generation, food production, industrial use and direct human consumption. An example of a water management strategy in China is the recent South-to-North Water Diversion Project. Started in 2010, it is an example


of ambitious geo-engineering to rewire the water map of China. This project seeks to quench the thirst of stressed regions in the north facing, amongst other things, the possibility of expanded biofuels production that would inherently compete for the same water as is needed for growing other crops, including food.


Recognising these interactions, and in response to price increases for food crops around the world in 2007-8, the government has imposed a ban on further construction of biofuels plants using grain as feedstock. Chinese biofuels production - so far mostly based on corn and wheat - is now looking for other feedstocks, including those for advanced biofuels. Effects on overall food production and land use remain to be monitored.


The case of China illustrates the importance of national planning processes, such as creating comprehensive water-management strategies, and addressing the complexity of interactions at the outset. At the same time, biofuels policies should be flexible to allow scope for adjusting them and national strategies as science and research advance.


Source: Global Subsidies Initiative (2008). Biofuels – at what cost? Government support for ethanol and biodiesel production in China. U.S Department of Agriculture (2009). China Biofuels Annual. GAIN Report Number: CH9059 IEA (2010). Sustainable Production of Second Generation Biofuels www.iea.org/papers/2010/second_generation_biofuels. pdf ICRAF: The World Agroforesty Centre (2007). Biofuels in China: An analysis of the opportunities and challenges of jatropha curcas in SW China.


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