Biofuel; a breakthrough for unemployment

March 28, 2011 - PRLog -- According to Dr Phindile Masangane, KPMG’s global infrastructure and projects group associate director, the biofuels sector will be used as one of the vehicles for job creation, with agricultural jobs being a core contributor.  

The Biofuels sector will contribute to rural economic development, employment and tax contribution, in line with the Department of Energy’s (DoE) strategic objectives.  The DoE’s objectives fall directly on eradicating poverty, economic development in rural areas, job creation, energy security and contribution to the renewable-energy target, greenhouse-gas emission reduction and sustainable development.  The DoE’s strategy has a modest target of a 2% biofuels contribution to final liquid fuels consumption by 2013, or 400-million litres a year (based on 2006 sales figures).  A financing mechanism was still being finalised but the approved strategy indicates a 50% fuel levy exemption for biodiesel, effective since April 2009 and a 100% exemption on ethanol.  The South African government is to drive transformation and upliftment through State-owned enterprise (SoE) investment in biofuels plants, coupled with land reform and agricultural support for such plants.

The DoE maintains that a cautious approach is needed to reduce the negative effect on food and land prices; however Professor Emile van Zyl from the Department of Microbiology at the Stellenbosch University says, the “food versus fuel” debate no longer holds validity with the use of second-generation biofuels.  “Currently hunger prevails in Africa, despite the fact that unused and abandoned agricultural land can provide food for Africa and support net export. If the biofuels industry is developed as a sustainable industry, using non-food biomass as source, biofuels can create alternative markets for farmers and actually secure food production,” he says.

According to van Zyl the “food versus fuel” debate primarily revolves around the use of grains for the production of bioethanol, using first-generation technology.  Around 60% of grains are used for animal feed, most of the remainder for human food and other uses, and only between 2 and 4% for biofuels production.  He went on saying the benefits of biofuels include their potential to provide a source of foreign exchange savings for oil-deprived countries, the boosting of local agriculture production, additional markets and revenue for farmers, their contribution to political security, making Africa less dependent on oil, and creating local wealth.

South African’s neighbour Mozambique, has positioned itself as a major biofuels producer and to date, foreign companies have invested approximately US$710 million in producing 440 million litres of ethanol a year, mainly from sugarcane.  Alfonso Rivera Revilla, Chairman of the Insight Group PLC, who offered the first Moringa oleifera biofuel investment project in Mozambique says, “In addition to creating hundreds of jobs in the region of Mozambique, Moringa oleifera as a second-generation biodiesel has no direct competition with farm-land as it can be grown for both purposes at the same time. It also thrives in land where most agricultural produce would not survive”.

“The advantages in using a second-generation biofuels source include the creation of alternative markets for farmers in expected overproduction years, thus, providing more flexibility, the creation of alternative commodity markets for non-food residues, and value addition when removing invasive species,” van Zyl said.

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