Questioning the sustainability of Biodiesel: Final report - October 2005

Manuel Frondel and Jörg Peters

in RWI Projektberichte from RWI - Leibniz-Institut für Wirtschaftsforschung

Abstract: Biofuels contribute to the mitigation of climate change. Directive 2003/30/EC thus aims at increasing the share of biofuels in total EU fuel consumption by up to 5.75 % by 2010. The rationale behind this directive can be found in potentially positive environmental impacts, most notably the reduction of greenhouse gas emissions, and by positive employment effects in the agricultural sector. This paper investigates the environmental, economic, and social implications of the support of rapeseed-based biodiesel as a substitute for fossil diesel. Based on a meta-analysis of recent empirical studies, we find clearly positive energy and greenhouse gas balances of this environmental strategy. Yet, the overall environmental balance of the substitution of rapeseed-based biodiesel for fossil diesel is currently far from being unequivocally positive. Our major finding is, however, that biodiesel is not a cost-efficient emission abatement strategy. When taking all economic, ecological, and social aspects into account, we conclude that Biodiesel is not a sustainable solution. We therefore suggest more efficient climate gas abatement strategies. Among these alternatives are synthetically generated biofuels that can substitute for fossil fuels in the future.

Keywords: Renewable Energy; Environmental Policy; Greenhouse Gas Emissions. (search for similar items in EconPapers)
JEL-codes: Q28 Q42 Q58 (search for similar items in EconPapers)
Date: 2005
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:rwipro:69922

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