Rod Oram had an interesting piece in the Sunday Star Times on biofuels and why the government's decision to back them is not a rehash of "Think Big". The obvious reason being that rather than betting with public money, they are instead establishing a regulatory environment which will create a demand and thus encourage investment in the area. Things were looking good on this front anyway, with British-owned Argent group already investigating whether to build a tallow plant in New Zealand - but the government's decision will give them the certainty they and other investors need to proceed.
Another thing Oram points out is that, on current oil prices, biodiesel is already cheaper than mineral diesel - at 90 cents a litre compared to 94. If oil prices remain high, then the market may take care of some of this problem anyway...
6 comments:
I don't think there is much problem here. Oil will only keep increasing in price - slight variations sure, but a constant trend upwards.
Posted by Joel : 9/06/2005 12:47:00 PM
What if we established an "industry insurance" allow them to produce product and subsidize the industry just enough to reach a certain level of profitability (biased on industry averages) and force them to pay a sort of insurance for having this benefit.
By the way if you are interested in selling tallow I know all the best international buyers...
If you mean using tallow for fuel then your problem is people overseas want it too badly - specifically chinese.
Posted by Genius : 9/06/2005 07:12:00 PM
I suspect a few people in 1973 thought that oil would always rise in price - it proceeded to fall for quite a long period in the 1980's.
Tallow is basically animal fat - right? So it's not a very efficient means of energy farming - except that people like eating meat, and the tallow is a by-product. What do the Chinese want it for - candlewax? If it's that useful maybe we should continue to export it and look at growing an altermative biofuel feedstock - I'm not sure the NZ climate works for soybeans?
Posted by Rich : 9/07/2005 02:39:00 PM
Ok I slightly misremembered - Here is the graph.
Oil prices shot up in the mid-70's then fell steadily. They went back up in response to the Iranian revolution and Iran/Iraq war, then trended down for over ten years until 1998.
Posted by Rich : 9/07/2005 02:49:00 PM
here is my biofuel bit
Posted by Canine : 9/10/2005 11:38:00 PM
Canine: in the US, they use exceedingly energy intensive agriculture, and essentially produce biofuels as another way of subsidising farmers. It doesn't have to be done that way, and one of the things people are looking at ATM is how we can produce the feedstocks efficiently.
In the short-term, though, we are looking at waste, and here there's no question that we can produce bioethanol and biodiesel cheaply. The problem is volume, not price.
Posted by Idiot/Savant : 9/11/2005 01:28:00 AM
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