Indirect Land Use Change due to Biofuels : Is it Worth it ? (original) (raw)

Efforts to reduce the indirect land use change (ILUC) related carbon emissions caused by biofuels has led to inclusion of an ILUC factor as a part of the carbon intensity of biofuels in a Low Carbon Fuel Standard (LCFS). While previous research has provided varying estimates of this ILUC factor, there has been no research examining the economic effects for the US and additional carbon savings globally from including an ILUC factor in implementing a LCFS. Using an integrated modeling framework we found that inclusion of an ILUC factor in a national LCFS led to additional abatement of cumulative emissions over 2007-2027 by 1.3% to 2.6% (0.6-1.1 Billion Mega-grams Carbon-dioxide-equivalent or B Mg CO2e) compared to those without an ILUC factor, depending on the ILUC factors utilized. The welfare cost to the US of this additional abatement ranged from 61to61 to 61to187 Mg CO2e-1 and was substantially greater than the monetary value of damages from carbon emissions (social cost of carbon) of $50 Mg CO2e-1. Main Text: Low carbon fuel policies at the federal and state level in the US such as the Renewable Fuel Standard (RFS) and the Low Carbon Fuel Standard (LCFS) in California seek to reduce dependence on fossil fuels and carbon emissions by inducing a switch towards biofuels. The RFS sets a quantity mandate for different types of biofuels that differ in their carbon intensity relative to gasoline. The RFS is implemented as a mandate to blend a certain share of biofuels with gasoline annually since 2007. On the other hand, a LCFS sets a target for the percentage reduction in the average carbon intensity of transportation fuel below a baseline level and provides blenders the flexibility to select the mix and quantities of different biofuels to meet the average fuel carbon intensity standard. The production of biofuels has raised concerns about their competition for land with food crops resulting in higher global crop prices 1,2 that lead to indirect land use change (ILUC) globally by creating incentives for the conversion of non-cropland to crop production and