An Unsustainable Scam

Just in time for April Fool's Day comes news of the latest scam in the biofuels industry. As we report today, cargo loads of biofuel are being shipped from Europe to the US where they are topped up, allowing traders to claim a subsidy from Washington, and then shipped back. Despite the dateline, this is no prank - it accounts for up to 10% of all biofuel exports from America to Europe - even though it makes a mockery of the notion of a green fuel.

The attraction of biofuels is obvious: they offer a simple solution to one of the thorniest problems of our times. If the fossil fuels we use, especially for transport, emit too much carbon then, runs the thinking, swap to low-carbon fuels made from potato or rapeseed. Clean and cheap, biofuels are a godsend for governments facing stiff targets on reducing carbon use. And so they set quotas or introduce subsidies to encourage take-up of this miracle fuel. From today, 2.5% of all petrol and diesel sold in the UK must be made from biofuels. And the EU plans to raise that to 5.75% by 2010.

The problem with biofuels is equally obvious: they are a simplistic solution to a problem too big to be tackled with mere shortcuts. They take up land and crops that might otherwise go towards feeding people, which is a big reason food prices have shot up. They typically require nitrogen fertilizers, which causes the soil to emit nitrous oxide, a greenhouse gas. Biofuels also require ploughing, harvesting, and processing - all of which use energy, often supplied by burning fossil fuels. For a supposedly clean energy source, biofuels are often surprisingly mucky; some may not help tackle global warming but make it worse.

Not all biofuels are alike, and a new, improved generation might be produced within a few years. But rather than go easy on using biofuels in the meantime, politicians are treating them as a convenience fuel.

David Toke of Birmingham University points to research published by the government department for business (the former DTI) which suggests that the UK should invest in biofuels on the continent, rather than develop its own domestic sources of renewable energy. After all, the UK is so far behind its EU targets on green energy, it might as well buy in the shortfall. Instead of Britain developing wave power, the government consultants propose, it can pay eastern Europe to develop biofuels - and so chop down their own forests.

This is breathtaking cynicism. Put this Whitehall proposal together with the private-sector trading scam and a picture emerges of biofuels being used as a cop-out. Despite all the talk of using sustainable fuels, both government and industry act as unsustainably as ever.