This document contains a discussion paper of the German Federal Ministry for Economic Cooperation and Development on the issue of international development of policy on agrofuels.
Over the past few years, agrofuels have increasingly been used in the transport sector as an alternative to fossil fuels, in the hope that this will help achieve climate protection goals. In many industrialised countries and more advanced developing countries, governments have introduced policies to promote agrofuels. Germany’s governing coalition parties agreed in November 2005 to increase the share of agrofuels in total fuel consumption to 5.75 percent by the year 2010 and replace the exemption of agrofuels from the mineral oil tax with the compulsory addition (“blending”) of agrofuels to mineral oil. This agreement was put into effect by the Biofuels Quota Act, which came into force on 1 January 2007 and provides for the blending target to be increase to 8 percent by 2015. In March 2007, the European Union set even higher blending goals. The German government took on board thee goals at its cabinet meeting in Meseberg and they are currently being translated into law through national and European legislative procedures.
Even more than these political decisions, it has been the rise in oil prices that has boosted demand for alternative fuels from biomass. As a result, the agricultural sector in developing countries is increasingly concentrating on fuel production.
Recent in-depth analyses and studies into the situation have prompted a re-examination of the opportunities and risks presented by agrofuels.

By: German Federal Ministry for Economic Cooperation and Development

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