The Policy Objectives of a Biofuel Industry in Canada: An Assessment

Danny G. Le Roy and Kurt K. Klein
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Danny G. Le Roy: Department of Economics, The University of Lethbridge, Lethbridge, AB, T1K 3M4, Canada
Kurt K. Klein: Department of Economics, The University of Lethbridge, Lethbridge, AB, T1K 3M4, Canada

Agriculture, 2012, vol. 2, issue 4, 1-16

Abstract: Canada has a huge stock of biomass resources, which provides a basis (and a temptation) for development of a major bio-fuels industry. Both federal and provincial governments have engaged in a wide array of subsidies, mandates, and other measures to stimulate production and consumption of biofuels. As a result, biofuels has become a growth industry in Canada with production of ethanol almost 10 times higher than it was ten years earlier. However, this has come at considerable cost to taxpayers. Increased biofuel production has resulted in minimal reduction in greenhouse gases, short run (but not long run) increases in net farm income (that benefited grain and oilseed producers but hurt livestock producers), large increases in the prices of farm land due to the higher grain and oilseed prices, and minimal impacts on rural economic diversification.

Keywords: biofuel; Canada; policy; economics (search for similar items in EconPapers)
JEL-codes: Q1 Q10 Q11 Q12 Q13 Q14 Q15 Q16 Q17 Q18 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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