The growing recognition that biofuels are being accepted around the world as part of the challenge of making the transition from petrol and diesel fuels as we know them today, to the fuel technologies of the future (e.g. hydrogen), is drawing positive developments from the industry, and crafted concern from major vested interest groups.

In Australia, the ethanol and biodiesel sectors have moved forward to establish a united biofuels industry infrastructure with the formal establishment of a single industry association – the Biofuels Association of Australia Inc (BAA Inc). This is a bold step as it challenges both ethanol and biodiesel to work for the common good of biofuels, as well as those vested interest factors that distinguish ethanol and biodiesel as cleaner burning renewable fuels.

This has not been common practice, and to our knowledge has not been tried before. Thus we are entering new ground. This is also a federal election year, and provides opportunities for policy changes sought by the industry, and will test the capacity of BAA Inc Board of Directors and members to present an industry focus that also effectively reflects the interests of ethanol and biodiesel producers.

Renewable Fuels Australia (RFA) and the Biodiesel Association of Australia are currently in a hold and transition phase as BAA Inc starts to get on it feet.

Worldwide, governments in many countries are accepting that biofuels are a strategic part of national interest imperatives to reduce escalating dependence on imported oil in a world where the risks of oil supply crisis and global economic disruption are being heightened by the approach of global peak oil, and the potential for instability in key oil producing countries.

Peak oil in America occurred in the 1970s, and in Australia the scales of peak oil tipped in 2003. Over 70 percent of Australia’s current balance of payments deficit is made up of oil and petroleum products.

The traditional major vested interest groups in the petroleum sector, the major international oil companies and the Organisation of Petroleum Exporting Countries (OPEC) have expressed concern over determination in the US and Europe to reduce their dependence on imported oil. The OPEC cartel controls over 40 percent of global oil production.

The oil majors and OPEC point to President Bush’s commitment to reduce America’s dependence on petrol by 20 percent by 2017 as a case in point for reconsidering or scaling back current plans for production and refinery expansion.

It has also been noticed that both OPEC and the major foreign owned oil companies have been active in highlighting that biofuels production could prove unsustainable, as the crops used for biofuels may threaten food supply (fuel versus food), and drive up food prices around the world. We are seeing growing evidence of these claims of biofuels industry threat in Australia, as well as overseas.

Clearly, these responses reflect that biofuels and alternative fuels generally are not just a passing phase of interest, and are being seen as having an important part in the mix of global transport energy of the future.

Australia’s role in this has yet to be determined, and every effort has to be made of the opportunity of the federal election to effectively get this message across to both the Coalition Government and the Kevin Rudd Labor Party alternative.

In other words, hold fast to your industry beliefs and your hats as 2007 is looming as a watershed year.

Bob Gordon
Executive Director
Australian Renewable Fuels Association