In 2007 the Italian company Tozzi Renewable Energy (TRE ltd) started its agro-fuel experience in Tanzania, while green oil value increased. This company was almost a pioneer to produce biodiesel from processing palm oil: it intends to respond not only to oil prices increase and climate change by exploiting biofuels potential, but also contributing to “a new green revolution for Africa” creating jobs and agricultural production. Since then, the so-called “agro fuel rush” in Africa has increased in spite of the slow-down in the half of 2008, due to financial crisis and the decrease in crude oil price.
Small investors as TRE share this market with world-size competitors, such as oil and agro-fuel companies. All companies want to have their own African slice waiting for a new climate change agreement, attracting huge funds in the agro-energy sector.
The green revolution claimed by TRE risks to turn into a new colonization, also because of the increasing global demand for biofuels, which could mobilize up to 53 hectares of arable lands in 20 years worldwide, the International Energy Agency (IEA) estimates. The EU aims at replacing 10% of its current oil consumption with biofuels by 2020, while US intends to reach 15% by 2017. In order to do so, a huge amount of biofuels will be imported. Having most of arable lands worldwide (807 million hectares) and a cheap work-force, Africa is potentially the greatest agro-fuel supplier in the world, the Copernic Institute, Utrecht University, Nederlands estimates. EU and US reduced or did off their tariffs for African biofuel imports, classifying them as agricultural products.
The EU Commission has just allocated 200 million euro to fund renewable energy projects in Africa along with a huge amount to biofuel sector. Opportunity for local development or energy exploitation for the sake of industrialized countries? The matter is controversial. According to our investigation, almost 70 projects are currently carried out in 28 countries by more than 40 EU and US investors and represent more than 2 million hectares. It is just a side of the agro-fuel fighting, where western investors, Brazilian, Saudi and Asiatic competitors are actually competing. Chinese projects are particularly ambitious and could cover up 4.5 million hectares land in Democratic Republic of Congo and Zambia. Beyond TRE, Italy is represented by Moncada Energy and Aviam in Mozambico, Fr-Li Green Power Holding in Ethiopia and Eni signed a frame-agreement with the Brazilian company Petrogas: in the future, it will export biofuels -produced in Angola, Mozambique, and Republic of Congo- to the Italian market.
In the latter country, Eni intends to deforest 70.000 hectares tropical forest to plant oil palm and refine 250.000 biodiesel tons per year. In order to pass from experimentation to commercialization, investors need to extend their land. In 6 years, TRE intends to extremely widen its lands. Most of the production will be exported to Italy and refined in the company’s plants. The vegetable species’ name is jatropha, whose fruits are not edible but suitable for oil production, biodiesel, seems to be the solution of agro-energy industry to certain critics evoking world food security crisis in 2008.
The World Bank estimated biofuels responsible for 75% food prices’ increase. The cause: cereals and lands used at the same time to produce food and energy. Investors swear that jatropha easily grows in “marginal”, barren or semi-arid lands, by avoiding to mine food plantations. However, in order to maximize crop yields, some farmers do not hesitate to grow it in the most fertile land, local NGOs say. “Jatropha plantation in barren lands doesn’t allow a sufficient productivity” says David Zilberman based in the Center of natural resources management, Berkeley University. In addition, most of the so-called “marginal” lands considered “available” for investors are actually a key-resource for nomadic groups, farmers or deprived communities who harvest timber or wild fruits.
The organization African Biodiversity based in Nairobi (Kenya) warns: the massive acquisition and privatization of new lands risks to cause the exile of farmers who are accustomed to cultivate food in collective lands. How to bring together agro-energy development and the protection of the local communities? This dilemma turned into a political crisis in Madagascar and Tanzania where farmers demonstrated against their respective governments. A drop in oil expenses and the set up of a new business attract African economies. “Biofuels can contribute to an agriculture rebirth, to revitalize land uses and livelihoods in rural areas” says Lorenzo Catula, International Institute for Environment and Development (IIED), London. this is the proof of several western African countries, such as Mali, which exploits local jatropha farms to build a rural electricity network. “However, the increasing biofuels commercial production can lead and leads to poor exclusion from their collective lands”.
This is what happened in Mozambique: a big bioethanol project in 30.000 hectares, Procana, carried out by the British company CAMEC/BioenergyAfrica caused 1.000 displaced families, who are now claiming their rights to be compensated. Mozambique is “open” towards biofuels and a rentable market for Italy, as stated in the report ICE 2008. Over 100.000 hectares exploited by Moncada and Aviam are just a small a part of 5 million, namely 1/7 of the country, negotiated with all the investors only in 2007 To maximize return on investment, agro-energy lobbies push for a reformulation of the Clean Development Mechanism (CDM) set up by the Kyoto Protocol and re-negotiated at the Copenhagen summit on climate change. By CDM, industrialized countries companies investing in projects to reduce carbon emissions, such as planting forests in developing countries, acquire “carbon credits”, which can be sold in turn to other companies willing to “compensate” the air pollution generated by their own activities.
However, the current proposals will broaden the definition of “forest” to any kind of plants, including plant species used to produce biofuels. Such a reform would give investors the opportunity to enjoy not only the export of some biofuels, but also the massive sale of carbon credits in the United States and the European Union.
The Canadian company Carbon2Green has recently applied its jatropha plantation project in the Democratic Republic of Congo in order to obtain carbon credits. If approved, this project will be the first of its kind to be funded by the CDM. Trade carbon credits threatens to promote uncontrolled agro-fuels expansion. However, experts warn: the uncontrolled biofuel expansion along with carbon credits business risks to endanger severely ecosystems and food security.