The world’s first commercial-scale seawater-based biofuels project boosts Egypt’s aquaculture profile. (Photo: Global Seawater).

EGYPT, Tuesday, April 13, 2010, 00:40 (GMT + 9)

Houston-based energy projects development company Energy Allied International and the Seawater Foundation and Global Seawater, Inc, pioneers in the development of Integrated Seawater Agriculture Systems (ISAS), have signed an MOU to develop the world’s first commercial-scale seawater-based biofuels project in Egypt: “New Nile Co.”

It will be one of the largest biofuels investments thus far in the Middle East or Africa.

ISAS is an advanced biofuels production model that uses effluent from seawater aquaculture as a natural fertilizer to grow large plantations of the halophyte (naturally salt resistant plant) salicornia, which can yield hefty volumes of high-grade vegetable oil for use as a biofuel feedstock.

“Energy Allied International’s expertise in developing large scale energy projects in the Middle East and Africa, tied with the Seawater Foundation’s and Global Seawater’s extensive knowledge of developing and operating ISAS models, is a winning combination to ensure the success of the world’s first, commercial scale, seawater-based biofuels project,” stated Dr Carl Hodges, chairman of The Seawater Foundation and co-chairman of Global Seawater.

Unlike first-generation biofuels producers that menace to displace staple foods like corn due to reliance on freshwater and nutrient-rich soil, New Nile will apply the ISAS model, thereby relying exclusively on untreated seawater and currently unproductive arid, desert and degraded lands.

“New Nile Co is poised to launch a great agricultural revolution in Egypt, by making productive use of the country’s abundant agricultural-skilled labour, unlimited access to seawater and vast desert lands,” said Mike Nassar, chairman of Energy Allied.

New Nile plans to produce tens of millions of lts of biofuels from a 50,000 ha-project site. Jointly with leading architecture design firm and the project’s lead planning advisor, Gensler, the developers are presently considering potential site locations along the Mediterranean and Red Sea coasts.

Already having successfully applied the ISAS model in Eritrea after conducting broad research and development in Mexico, the developers are secure of achieving similarly favourable results in Egypt.

Besides automotive markets necessitating the use of blended biofuels, New Nile will target the European civil aviation market. The latter is put through strict European Union (EU) regulations, and aviation will enter the EU Emissions Trading Scheme in 2012.

New Nile’s developers are currently discussing potential project site locations with the Egyptian Government and intend to complete the bankable feasibility study this year and being construction in early 2011.

By Natalia Real

SOURCE: FIS

BA says the plant will reduce the amount of waste sent to landfill.

British Airways has struck a deal to build the first plant in Europe to produce jet fuel from waste matter.

Some 500,000 tonnes of waste will be used by the UK facility each year to produce 16 million gallons of fuel.

Construction of the plant in east London will start within two years. It is set to produce fuel from 2014, creating up to 1,200 jobs.

BA said the plant would produce twice the amount of fuel needed to power all its flights from London City Airport.

It would only account for about 2% of flights from Heathrow, however.

Greenhouse gas

BA argues the plant will cut the amount of waste that is sent to landfill, reducing the amount of methane that is produced.

Methane is thought to be a more potent greenhouse gas than carbon dioxide.

The plant will be built by a US company Solena Group, with BA committing to buy all of its output.

It will be another four years before it starts producing fuel, and it is unlikely to work at full capacity straight away.

The ideal source material for the plant is waste matter that has a high carbon content.

Biofuel creation

The waste is fed into a high temperature “gasifier” to produce BioSynGas.

A chemical process called Fischer Tropsch is then used to convert the gas into biofuel.

Waste products from the process can be used to power the plant as well as supply 20MW of electricity to the national grid.

A solid waste product can be used as an aggregate in construction.

The fuel produced by the plant is certified for use in other countries, but not currently in the UK.

BA says it is confident of getting the certification by the time the plant starts producing fuel, either for use in a blend with traditional kerosene or on its own.

By Richard Scott

Source: BBC

A research project will make jet fuel without wasting fresh water or farmland.

A project in the Middle East aims to make jet fuel from saltwater-tolerant crops grown in the desert. Researchers at the Masdar Institute in the United Arab Emirates are starting a two-square-kilometer demonstration farm that will combine fish and shrimp farming with the cultivation of mangrove trees and salicornia, a plant with oil-rich seeds that can be converted into fuel.

 The goal is to produce biofuels without taking away land from food crops or using large amounts of fresh water, which are two of the major shortcomings of conventional biofuels, says Scott Kennedy, an associate professor at the Masdar Institute who is leading the project. The project is supported by several major companies: Boeing, Etihad Airways (the national airline of the UAE), and UOP Honeywell, which will supply technology for converting the biomass to chemical precursors and fuels. The Masdar Institute is part of a zero-emissions city being built in Abu Dhabi, the largest emirate in the UAE.

Kennedy and his colleagues will refine a technique called integrated seawater agriculture. It begins with digging a canal from the sea. That canal delivers water to several stages in the system. First, the researchers pump saltwater into ponds or flow it past cages used for growing shrimp or fish. Ordinarily, such aquaculture is an “environmental disaster,” Kennedy says. The runoff contains large amounts of feces that can cause dangerous algae blooms, for example. But in the Masdar system, the researchers will use that effluent downstream to fertilize salicornia.

Story continues below 

The salicornia is grown in saltwater-irrigated fields, and can be harvested like other crops, such as wheat or rice. The runoff from that irrigation, now saltier and still containing some effluent from the fish and shrimp, together with more water from the canal, is next fed to a stretch of planted mangrove trees, which can grow in that saltier water. The mangrove forest provides a barrier, so that none of the polluted water from the fish farm returns to the ocean. The leaves can also be used as food for the fish.

The oil-rich seeds of the salicornia can be pressed using processing similar to that used for other oil seed crops, such as sunflowers. That oil can then be modified by a proprietary UOP Honeywell process that makes it suitable for blending in jet fuel. The rest of the plant can then be further used to produce liquid fuels, or burned to produce steam for electricity generation.

The fish farms provide both a source of income and a source of fertilizer, which reduces overall carbon emissions, since producing and using fertilizer is ordinarily a major source of carbon emissions in biofuels production. The mangrove forest also sequesters carbon dioxide in its root system. Most biofuels are at best carbon neutral, emitting as much carbon dioxide when they’re produced and burned as the biofuel crops take in as they grow. One of the key parts of the Masdar research project is determining just how much carbon can be economically sequestered.

A version of the system has already been demonstrated in the north African country of Eritrea by Carl Hodges, the founder and chairman of the Seawater Foundation. (He’s acting as a special advisor to the Masdar project.) In that project, the salicornia and leaves from the mangroves were used as animal feed, and some of the oil from the seeds was converted to biodiesel. That project ended as a result of political upheaval in that country, Hodges says, but it demonstrated that the integrated approach could work.

The effort to avoid using fresh water and land that’s used for food “should be applauded,” says Mark Schrock, a professor of biological and agricultural engineering at Kansas State University. But he says it will be important to quickly develop a mechanized means of harvesting the salicornia. This could be a challenge because, although it can be harvested with existing equipment, the plant has high salt levels that could damage these machines, says Wayne Coates, a professor at the Office of Arid Land Studies at the University of Arizona.

It will also need to compete with other biofuels crops. Per acre yields of oil are on par with soybeans (which provide additional economic value from non-oil products), but are just one-eighth the yield of palm oil. The saltwater system, however, has the advantage of not requiring expensive land and water, and it produces its own fertilizer. Kennedy says that initial estimates suggest that fuel produced from salicornia could be competitive with petroleum-based fuels, but warns that detailed studies still need to be done.

Kevin Bullis

Source: Technoloy Review

www.salicornia.net coming soon

In past days the envelopes with the technical offer of the Official Plan of Renewable Energies (GENREN) bid were opened. The proposing companies are now waiting for the economic offer envelopes.

he Argentine government announced the results of the 1,015 megawatt (MW) renewable energies tender proposed last May. The total offers reached 1,461 MW, a 46% oversubscription. The offers were broken down by technology: 1,203 for wind power; 155.4 MW from biofuels; 54.1 MW from biomass; 14 MW from biogas; 22.5 MW from photovoltaic solar energy; and 12.7 MW from small hydro projects.

The opening of the sealed envelopes was done at a ceremony at the presidential mansion known as la Casa Rosada, which included words from Argentine President Cristina Fernandez de Kirchner as well as from the Federal Planning Minister, Julio de Vido.

According to a recent study by the Argentine Renewable Energy Chamber (CADER), nearly 70% of Argentina’s territory is covered with winds whose annual average speed, measured at 50 meters above ground level, surpasses 6 m/s. In Central and Southern Patagonia the speeds can reach on average 9 m/s and up to 12 m/s. Most areas in the vast Patagonia region experience annual average capacity factors above 45%. The provinces of Córdoba, part of San Luis, La Pampa, San Juan, La Rioja and the central and southwestern regions of the province of Buenos Aires yield capacity factors between 35% and 40%.

But despite such massive potential, the 30 MW of wind generation that has been installed to date comes mainly from projects completed between the mid-1990s and early 2000s that were developed by small cooperatives in the Patagonian region.

The tender had been launched by the government last May to assist in the requirements under Renewable Energies Law 26.190 from 2006 that requires that by the year 2016, fully 8% of the country’s energy matrix must be derived from renewable sources. Once all offers have been reviewed, the government must evaluate each one objectively – prices offered and the companies’ technical and financial capacity, among others. According to calculations by the Argentine Renewable Energies Chamber, if all 1,462 MW are accepted it will result in investments in excess of US$2 billion and the creation of approximately 1000 new jobs.

After the public announcement, the President of the chamber, Carlos St. James, exchanged thoughts about the next steps with President Fernandez, expressing optimism about the future of the industry. “These offers, considering the quality and prestige of the multinational companies making them, leaves no doubt that Argentina is on its way to developing a full-fledged renewable energies industry. This is a clear demonstration of what can be achieved when a fluid communication is established between the public and private sectors.”

As the chamber had indicated in its recent State of the Argentine Wind Industry study published last May, Argentina has unequaled potential to develop wind energy, as seen by the dominance of wind projects in the tender totaling 1,203 MW, more than 80% of the total offerings. According to Mauro Soares, President of the Wind Energy Committee of the Chamber, “This tender generated unparalleled activity and interest from our sector; the number of proposals focused on wind was very gratifying. Now we will finally see this energy become part of our country’s energy matrix. We welcome this launch of the industry in Argentina, and I congratulate all those that worked towards making it possible.” Also, Sebastian Kind, co-author of the study and board member of the chamber, stated, “Today we saw a high degree of confidence of the sector’s potential; the 1461 MW offered represent solid foundations for a prosperous renewable industry. Argentina has a unique opportunity to generate new skills and develop technology while providing clean and competitive energy for our future.”

According to a recent study published by New Energy Finance, based in London, the global renewable energies industry invested US$155 billion in 2008, with a compound annual growth rate of 45%. Latin America captured US$12 billion of this total, but it is growing at a CAGR of 145%.

The Argentine Renewable Energies Chamber (Cámara Argentina de Energías Renovables, or CADER) is a non-profit industry trade association dedicated to the sustainable development of renewable energies in Argentina. It seeks to play a vital role in the establishment of a solid and vibrant industry, one which is respected globally for its standards and practices.

The Chamber counts among its members companies that believe these principles and work towards developing the local solar, wind and biomass sectors. Its great diversity in members creates one of the Chamber’s greatest strengths, since it is the only organization that represents the entire spectrum of this nascent industry’s value chain.

In past days the envelopes with the technical offer of the Official Plan of Renewable Energies (GENREN) bid were opened. The proposing companies are now waiting for the economic offer envelopes, which will be handed once the technical analysis is concluded. The complete list of proposing companies follows.

1. Emgasud Renovables: 4 wind farms (3 of 50 MW and one of 30 MW, two in Madryn and one in Rawson)

2. Patagonia Wind Energy: one 50 MW wind park, in Madryn.

3. Energías Sustentables SA: one 20 MW wind farm, in West Madryn.

4. International New Energy: one 50 MW wind park, in North Madryn.

5. Sogesic SA: 2 wind parks, of 50 MW, in Tres picos.

6. Unitec Energy – San Jose Argentina – INVAP (UTE): 2 wind parks, of 50 MW.

7. Isolux Ingenieria – Gas y Petróleo de Neuquén – Ingenieria Sima SA, (UTE): one 50 MW wind park.

8. Isolux Ingenieria: 4 wind parks of 50 MW in Loma Blanca 1.2.3 and 4.

9. Impsa Wind SA: 10 wind parks. Kaluel Kayke I (50MW), II (25MW), Malaspina I (50 MW), II (30MW), Condor Cliff La Barrancosa (50MW), Piedra Buena I (50MW), II (30MW), Las Heras (50 MW), Tornquist (50MW).

10. Pan American Fueguinas SA: 28 MW wind park in Cerro Dragon.

Patagonia in Argentina has some of the best conditions in the world for wind power generation. Not only are the winds strong in Patagonia, but they are also fierce in the south of Buenos Aires province and interior provinces such as Córdoba. Blessed with such potential, Argentina should be a world leader in wind energy.

Source: evwind

Following the publication of the EPA’s draft Regulatory Impact Analysis this week which includes proposed changes to the Renewable Fuels Standards Program, the Argentine Renewable Energies Chamber expressed both concerns and optimism regarding the possible effects this will have on the export-driven Argentine biodiesel industry.

Buenos Aires, May 8, 2009 – A recent study published by the Environmental Protection Agency of the United Status (EPA) is promoting biofuels that reduce greenhouse gas (GHG) emissions by no less than 50% when compared to their fossil fuel counterparts. This same report classifies different categories of biofuels and concludes that soy-based biodiesel reduces GHG emissions by only 22%. If approved, the EPA’s proposal could cause grave harm to Argentine biodiesel producers, since more than 95% of Argentina’s biodiesel is made from soy oil. Additionally, the industry is export-driven and the United States is Argentina’s second largest export market after the European Union.

“The EPA’s analysis has the potential to drastically reduce Argentine biodiesel exports to the United States. It makes decisions regarding land use change for countries other than the U.S., yet doesn’t appear to take into consideration the positive effects of Argentina’s No-Till farming methods which plays a role in ensuring that Argentine soy biodiesel meets and exceeds the newly proposed stringent U.S. standards,” said Carlos St. James, president of the Chamber.

“While we fully understand and appreciate each nation’s right to establish standards and goals
for products consumed in their country, facts need to correct. We know that Argentine soybased
biodiesel is among the cleanest and environmentally-friendly options. This has been evidenced in scientific studies developed in the U.S. itself some years ago and more recently by our country’s National Institute of Agronomy Technology (INTA, by its initials in Spanish), both of which show reductions in GHG emissions that exceed 70%.”

The EPA has proposed a 60-day window in which the various industry actors can better understand the assumptions in the study and to offer counterproposals and corrections to this data. “Argentina has sound scientific elements to defend its position. We need to work internally with all industry interests along with relevant government agencies to present a common voice to ensure we are heard properly,” affirmed Lucas Trotz, the Chamber’s Manager. The Chamber is requesting a 40-day extension to the initial window, and various Chamber members will travel to Washington to participate in the July 9-11 workshop being organized by the EPA to discuss the draft.

The Chamber will also seek this extension as member of the Global Renewable Fuels Alliance, a global association whose members represent 65% of world biofuels production. Bliss Baker, Executive Director of GRFA from its headquarters in Toronto added, “Argentina, as one of the world’s largest biodiesel producers and exporters, will undoubtedly play a key role in ensuring that the industry continues to grow sustainably and we will work with them to present our organization’s point of view regarding the EPA study.”

St. James concludes, “We are confident that at the end of the day common sense, a frank and open dialogue, and the facts will carry the day. If not, the ideals of fair and open trade as espoused by the U.S. will take a step backward in the ongoing task of creating global markets.”

Tunuyán, first municipality to participate in the Bioenergy Program for UNC.

Tunuyan, also participates in investigations of oilseed rape, topinambur and biomass.

The municipality supports the research and development of biodiesel with a monthly financial contribution. Besides is the only department involved in the Bioenergy Program for 2007-2010.

Tunuyan is the only department across the province participating in the Bioenergy Program 2007-2010. With a monthly financial contribution, the municipality of Tunuyan supports research and development of biodiesel.

In addition, the department hosted a major meeting between the president of the Bioenergy Program at the National University of Cuyo, Jorge E. Núñez Mc Leod, and the mayor Eduardo Giner.

In the extensive meeting they highlighted the importance of being the only department of the province which works with the relationship between society and the Bioenergy Program.

The Bioenergy Program of Universidad Nacional de Cuyo emerges as a necessity to fill a vacancy on expert knowledge in the area of biofuels.

This project has a horizon of 4 years and aims to achieve scientific and technological definition of biofuel cycles adapted to regional realities in the province of Mendoza.

The department is part of a list of entities that are merged with the goal of making the UNC self-sufficient in biofuels to 2010.

Tunuyan, also participates in investigations of oilseed rape, topinambur and biomass.

Source: MDZ/Mendoza/Argentina

KANSAS CITY, Missouri (Reuters) – It’s corn planting time in the U.S. Plains, and that means Kansas corn farmer Merl “Buck” Rexford is worrying about the weather — and hoping there is enough water.

Rexford plans to start seeding his 7,000 acres near Meade, Kansas, this week and he is relishing a recent heavy snow storm that dropped several inches of much-needed moisture.

Like corn farmers throughout the United States, Rexford hopes to grow a healthy crop yielding more than 150 bushels an acre this year. Much of his crop will wind up at a nearby ethanol plant.

And that puts the 65-year-old Rexford at the center of a bitter divide over biofuels, particularly corn ethanol.

Critics argue that precious water resources are being bled dry by ethanol when water shortages are growing ever more dire. Federal mandates encouraging more ethanol production don’t help.

Proponents say corn ethanol for transportation fuel is far better for the environment, national security and the economy than oil and the first step toward cleaner fuel sources.

“We really have to ask ourselves, do we want to be driving with renewable fuels or with gasoline made from petroleum resources,” said Brent Erickson, executive vice president at the Biotechnology Industry Organization, which backs ethanol.

Corn ethanol’s future is already muddied by concerns that it requires a substantial amount of energy to produce and that heightened demand makes corn more costly in human food and livestock feed. Now, with climate change concerns mounting and drought becoming more of a problem in many areas, the water-intensive nature of creating ethanol also is a growing concern.

“Biofuels are off the charts in water consumption. We’re definitely looking at something where the cure may be worse than the disease,” said Brooke Barton, a manager of corporate accountability for Ceres, a group backed by institutional investors focused on the financial risks of climate change.

Corn is a particularly thirsty plant, requiring about 20 inches of soil moisture per acre to grow a decent crop, but most corn is grown with rain, not irrigation. Manufacturing plants that convert corn’s starch into fuel are a far bigger draw on water sources.

Water consumption by ethanol plants largely comes from evaporation during cooling and wastewater discharge. A typical plant uses about 4.2 gallons of water to make one gallon of ethanol, according to the Institute for Agriculture and Trade Policy.

The ethanol industry pegs that at about 3 gallons of water to 1 gallon of fuel.

WASHINGTON PLAN

Washington lawmakers and the White House have been encouraging the use of ethanol as an alternative fuel to help lighten the nation’s costly dependence on foreign oil.

But the moves are meeting opposition from many groups who fear that population growth and climate change are combining in ways that will leave not only the United States, but the world, with too little water. Many ethanol plants are located in agricultural areas — close to the corn, but also close to other users who need a lot of water to operate, such as hog farmers and cattle ranchers.

“We’re headed in the wrong direction and this problem is not going away,” said Mark Muller, program director at the Institute for Agriculture and Trade Policy. “This water issue is like the financial crisis… and I’m afraid something awful is going to happen.”

The group says much of the Corn Belt stretching through Iowa, Illinois, Nebraska, Minnesota and Indiana has enough water for all, but water availability could challenge the ethanol industry in areas including greater Chicago, western Iowa and Nebraska, and generally west of the Missouri River.

“Water use could be a limiting factor (for ethanol) if we don’t introduce and support more water-saving technologies, ” added the Institute’s Jim Kleinschmit.

“Water is a worry,” agreed Heritage Foundation senior policy analyst for energy and environment Ben Lieberman. “When we expand corn ethanol as we have with these federal mandates,” he said, “we are starting to see corn in more marginal areas that may need more irrigation. We are seeing increased water use not just for the processing plants but also the water in growing the corn.”

Last month, a coalition of environmental, agricultural, business and consumer groups asked the Obama administration not to raise the amount of ethanol blended into gasoline without further study.

Ethanol supporters don’t dispute the water-intensive nature of the industry. But they say much of the corn crop relies on rain from the skies, not pumped out of the ground, and even irrigation systems are improving to reduce water usage by almost half. More water-efficient production plants are also reducing water use. In January 2009, there were 170 ethanol plants operating in the United States and 24 more new or expanding plants.

In 2008, the United States led the world in ethanol production, generating 9 billion gallons, or 52 percent of the world production. That is up from 6.5 billion gallons of U.S. ethanol in 2007, according to the Renewable Fuels Association. The U.S. aims for 15 billion gallons by 2015.

THIRSTY WORLD

Freshwater consumption worldwide is expected to rise 25 percent by 2030 due largely to world population growth from 6.6 billion currently to about 8 billion by 2030 and more than 9 billion by 2050, according to Ceres.

Some believe crop biotechnology could offer at least a partial solution, and several companies are racing to develop corn that is drought-tolerant, including Monsanto Co, which hopes to launch a product in 2012.

DuPont Co.’s Pioneer Hi-Bred unit plans to roll out a low-water conventionally produced corn as early as 2010.

Back in Kansas, farmer Rexford would welcome a more drought-hardy corn seed. Water to irrigate his crop is getting harder and more expensive to come by.

Still, farmers need the premiums selling their corn for ethanol can bring, he said, just as much as the nation needs to break free from dependence on foreign oil.

“If farmers go out of business you’ll have a lot worse crisis than an oil crisis,” he said.

(Reporting by Carey Gillam, editing by Peter Henderson and Cynthia Osterman)

Source: Reuters

The fair achieved the support of San Lorenzo’s Chamber.Â

It will be held from April 3rd to 5th and the prices of the stands didn’t raise. It is expected to gather more than 120 companies and to be a thermometer of the cord activity.Â

Puerto San Martin has already set date for the fourth edition of the Expopuerto, the most important party in the area, where the small, medium and big industries that integrate the productive chain, show their potential. The event will held from the 3rd to 5th of April in the Parque Linda Vista. Â

This year the municipality of this town strongly bets on the confirmation of most of the companies of the area, like it is the case of the oil factories, which have already participated of previous editions. The query arises due to the current crisis that some companies are going through and it is ignored how they will act: if they won’t be presented or, on the contrary, if they will want to show their products even more, keeping in mind that to this fair attend a great number of businessmen with intentions of knowing the activities of other plants.Â

“This year we are working together with the Chamber of Commerce of Puerto San Martin and San Lorenzo, which gather the different companies of the region and in spite of the world financial problem, we expect the companies to join to the proposal. Up to now, most of those that participated the last year, already confirmed their presence”, indicated Carlos De Grandis, intendant of this that town.Â

During the year 2007, 120 companies were the ones that exposed their activities and around 40.000 people who visited the exhibition stands, transforming this party into one of the most important of the region.Â

This year, the thematic will be similar to the previous editions; from the month of December that the office that organizes the exhibition is to the search of the Grain industries, Oil factories, Chemicals, Petrochemicals, Gas Industries, meat processing plant, Pharmacists, Minings, among others.

Its organizers affirm that the objective of the exhibition is “to offer a social and commercial interaction space between the productive forces and the community to impel the invigoration of the productivity and competitiveness of the companies of the region.”Â

As complement and to bring near the spectators that are not businessmen, the exhibition offers diverse shows with well known artists, handicrafts fair, interactive games, traditional foods and even parachute jumping among other attractions.Â

The prices don’t go upÂ

On the other hand, from the organization they indicated that the prices of the stands won’t suffer big modifications in order for the small companies to participate. The communal boss highlighted the necessity to attract these new biodiesel companies: “We have the hope that they will be all the companies of the city, the oil factories and especially those of biodiesel, which have not been able to start with their production due to the crisis; but we want them to show to the city and the region what it is about and what benefits they bring”, he sustained.Â

In another order of things, De Grandis showed his concern for the present time of the industries resided in the city; most of them off on vacations and others that still don’t start as those of biodiesel Explora and Unitec Bio.Â

“The situation is not easy, and now the problem of the lowering of the river is added, where when not having the river the 32 feet of draught it impedes the entrance and exit of the ships. There are forecasts that indicate that in March the situation would be reactivated a little more; I hope aren’t mistaken”, he concluded.Â

Anabela TramontiniÂ

Courtesy of Punto Biz for Nextfuel Argentina/Biodiesel.com.ar

The bond issue responds to growing interest from investors, who wish to support climate change-related projects in developing countries.

The green bonds will support the Bank’s climate action projects (both mitigation and adaptation).

The bond is an example of innovation the Bank is trying to encourage to stimulate public and private-sector financing for climate action

The World Bank recently launched its first “green bonds” designed to raise additional funding for projects or programs that support low-carbon activities in client countries.

In partnership with SEB, the World Bank raised approximately US$350 million via several key Scandinavian institutional investors. The bond issue responds to growing interest from sustainable or socially responsible institutional investors, as well as some individual investors, who wish to support climate change-related projects in developing countries.

The bond issue is one example of the kind of innovation the Bank is trying to encourage within its Strategic Framework for Development and Climate Change, endorsed by the Development Committee at the last Annual Meetings in October. One objective of the Framework is to help stimulate and coordinate new public and private-sector financing for climate action. The offering is the first time the Bank has offered bonds to raise funds identified to a specific program.

In a statement issued when the bonds were launched, President Robert Zoellick said “Tackling climate change is going to take immense resources that will only come from a well-orchestrated flow of public and private finance. This transaction is an important early effort to show one way in which this can be done.”

For its part, SEB President and CEO Annika Falkengren said “With this issue, we have been able to offer our clients a product through which they can accomplish three things: take a stand towards fighting global warming; support the World Bank and its members in their efforts to fight poverty; and secure a higher return than government securities by investing in the World Bank’s Aaa/AAA-rated bonds.”

The first issue of green bonds was denominated in Swedish kronor (SEK) for a total amount of SEK 2.325 billion and has a maturity of six years. At the time of issuance, the interest rate payable annually was 0.25 percent above Swedish government bond rates, for a yield to investors of 3.15% per annum. SEB is the sole lead manager and offered the bonds to investors through its distribution network.

“This new product is a special funding opportunity for the World Bank and investors since it supports climate change investments in our client countries,” said Doris Herrera-Pol, Director and Global Head of Capital Markets at the Bank. “We are very grateful to SEB and the investors for their interest and partnership, and to all those who have supported in finding and implementing a solution to respond to this increasing investor demand for ‘green’ investment products.”

Green bonds support mitigation and adaptation

The green bonds will support the Bank’s climate action projects (both mitigation and adaptation).

Examples of the types of mitigation projects supported would be:

Rehabilitation of power plants and transmission facilities to reduce greenhouse gas emissions;
Solar and wind installations;

Funding for new technologies that result in significant reductions in GHG emissions;

Greater efficiency in transportation, including fuel switching and mass transport;

Waste (methane emission) management and construction of energy efficient housing;

Carbon reduction through reforestation and avoided deforestation.

Examples of the types of adaptation projects supported by the bonds would be

Protection against flooding (including reforestation and watershed management);

Food security improvement and stress-resilient crops (which will slow down deforestation);
Sustainable forest management and avoided deforestation.

A special “green account” to manage the funds

A special “green account” will be used for proceeds from green bonds. At the end of every quarter, funds will be deducted from this account and added to the World Bank’s lending pool in an amount equal to that quarter’s new, “green” disbursements to support eligible projects.

Warren Evans, Environment Director at the Bank, said “we’re delighted not only to see real investor interest in this new offering from our Treasury colleagues, but also to know that the expanded pool of available resources to support our work on climate change will allow us to do more and go faster in helping client countries move onto low-carbon development paths.”

The Brazilian president, Luiz Inácio Lula da Silva, launched last week a new “órdago” to the planetarium energy establishment. It was during the closing of the I Internacional Conference on Biofuels held in São Paulo that concluded that the world ethanol production will grow 200% in the next six years, eating lands to the fossil fuels. The African continent is in the Brazilian aim point, vast in hectares of waste lands and generous in sun and manpower, essential elements for the cultivation of the sugarcane.

Discreetly and without making noise, two years ago Brazil disembarked in Africa with the objective of giving a new turn to the screw in its strategy to implant the green energy worldwide, but also to make business and consolidate its influence in the region; everything in a moment in which China also has its look put in the raw materials and the manpower of the black continent. The pulse is hidden but it is real.Â

Brazil is the second world producer of ethanol, just behind of United States. It is also the country that more knowledge and experience stores in the investigation of the biofuels. Seven of each ten Brazilian vehicles are moved today with alcohol.Â

The interest of the brazilians for the development of this source of green energy goes back to the oil crisis of the seventy, when the country decided to use its surpluses of sugarcane to produce an alternative fuel that diminished its dependence on the crude.

Today, several brazilian companies, beginning with the own state oil company Petrobras, are in the vanguard of the ethanol market, and in Brasilia it is thought that the moment has arrived to launch the business on a planetary scale. “There will only be an international market of biofuels if many countries produce and many countries buy”, comments to EL PAIS a high source of the Brazilian ministry of External Relationships.Â

To the above-mentioned it is necessary to add the already known interest of Lula to create an area of Brazilian strategic influence in the African continent, something that is reflected clearly in the seven official visits that he has already carried out to the region since he become president. More than one per year.Â

Good faith of what is conceiving between Brazil and Africa gives the recent visit to Brasilia of the president of the Bank for Investment and Development (BIDC) of the Economic Community of West African States (CEDEAO), Christian Adovelande. The meetings that were developed between Adovelande and officials of the Empresa Brasileira de Pesquisa Agropecuária (EMBRAPA) were unnoticed, although in them is the key of the economic movements that are approaching in these countries. As the director of the BIDC, Africa is resoluted to help Brazil in its pretension of converting the ethanol into a raw material of world reference, as for today it is the petroleum or the natural gas. In exchange, Brazil will transfer technology and will create work positions in the region.Â

From Brasilia arguments of humanitarian tints are also used, as the combat to the energy shortage that afflicts to not few African countries. “The countries can´t developed without energy, and today in Africa the average of the population that has access to her is of 30%. In western África this average falls to 4%”, explains the previously mentioned source. “It is important that these countries adopt their own energy logic and the ethanol is a good alternative. In view of the arguments that the ethanol goes in detriment of the food production it is necessary to leave something straight: Africa already stopped to produce foods a long time ago”, it concludes with forcefulness.Â

Lula already has fifteen countries on its sideÂ

Of the fifteen African countries that would be willing to produce ethanol with brazilian technology and supervision (Benín, Burkina Faso, Cabo Verde, Costa de Marfil, Gambia, Ghana, Guinea, Guinea Bissau, Liberia, Mali, Níger, Nigeria, Senegal, Sierra Leona and Togo), in some of them the first investments of brazilian flag companies have already begun. It is the example of Ghana, where recently a permanent delegation of the EMBRAPA has been inaugurated to supervise the projects launched in the region. In this country that soaks its coasts in the Gulf of Guinea, the Brazilian construction company Constran has invested more than 300 million dollars in the necessary infrastructure to process annually between 150 and 180 million liters of ethanol starting from the cane that is picked up in 30.000 cultivated hectares. Who will the last beneficiary of the valued green fuel be? The Swedish signature Svenks Etanolkemi AB (Sekab) has already committed during ten years to buy the production of ethanol made in Ghana.Â

From now on, the logic seeks to be the same one: the EMBRAPA will guide enterprises between brazilian and local companies for the production of ethanol, financed partly with soft credits granted by The Brazilian Development Bank (BNDES). The idea is that the market of this production ends up located in the European Union (EU), expanding this way the consumption of ethanol in one of the most outstanding regions in the globe. The business, therefore, has several open fronts.Â

“The studies that we have indicate that the conditions for the cane plantation in some african countries are excellent. They are lands that resemble a lot to the closed brazilian”, explains José Roberto Rodrigues, General Director of Technological Transfer of the EMBRAPA. According to Rodrigues, it is evident that next to the praiseworthy objective of stimulating the alimentary and energetics sovereignty of Africa, the installation of projects in the region opens a new breach to the brazilian agribusiness industry to obtain fatty benefits.Â

Last Friday Lula was graphic in a speech clearly directed to the Europeans: “What we would like is that the rich countries, when going into in the era of the biofuels, finalize collaborations with the poor countries, mainly in Africa, so that part of the biofuels that the rich countries want can be produced there. It is a way of helping with the development of Africa, it is a way of solving the problem of the immigration.”Â

By Francho Barón

Source: El País �