Biomass and biofuels: how to integrate industrial and innovation policies with renewable energy obligations

By Ilian Iliev on May 5, 2011 in IP


There is a need for innovation and industrial upgrade policies to be co-ordinated with renewable energy capacity obligations for Bulgaria and other accession member states to the EU: that was the main message of a presentation by CambridgeIP’s CEO Ilian Iliev at a recent workshop on The Costs and Benefits of Renewables: Biomass organised by the Center for Study of Democracy in Sofia, Bulgaria.

For smaller EU member states who are also dealing with the legacy of the financial crisis it can be politically and economically very costly to allocate the resources needed for a transition to a low-carbon energy economy. The worst approach would be one of ‘box ticking’ – doing the minimum possible to meet EU renewable energy obligation targets. Ilian emphasised the need to link-up the disparate areas of energy system regulation, industrial and innovation policy. In that way the required resource commitments to meet EU renewable energy obligations can support broader targets for value chain migration of the domestic industry, migration of the domestic economy towards greater energy efficiency and higher value-added by the domestic economy.

The workshop specifically focused on what policies can support greater deployment of technology around biomass. An integrated industrial policy around biomass should take into account the different agricultural, industrial processing and final use areas where biomass is particularly important:

• Biomass production techniques

– 1st generation: pre-dating oil production

– 2nd generation: use of waste, non-competitive to food stocks

– 3rd/4th generation: such as algal-biofuels

• Biomass–to–electricity and/or heat technologies

• Transport technologies adaptation (such as dual-fuel automotive and jet engines)

• Industrial processes/chemicals production (such as biomass-based glycol production)

It is important for governments to design long-term policies which can provide predictability to entrepreneurs, key industrial players and financiers alike. Ilian concluded by citing the example of Brazil’s 20 year old industrial support strategy around the production of ethanol as one such example of an emerging market that has developed a global leadership in an area of biomass and biofuels.

Other participants included the Deutsches Biomasse Forschungs Zentrum (DBFZ), Bulgaria’s Institute for Green Policies, the World Bank’s infoDev. The meeting was moderated by Ruslan Stefanov, Director, Economic Program, Center for the Study of Democracy. The event was covered by Bulgarian TV and other media, and took place in the context of the recent passing of Bulgaria’s new law on renewable energy sources (See coverage in Mondaq; see coverage in Bloomberg)

CambridgeIP has worked with the CSD in the past in mapping key patent and technology innovation trends in the Bulgarian economy, the science and technology outputs of key scientific institutions, and more broadly around innovation and industrial policy options. See the CSD’s past annual report. Ilian Iliev is a fellow at the CSD’s economy program, and has co-authored a textbook on Systems of Innovation with leading Bulgarian academics.

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