Global biomass availability in light of policy development – iLUC Focus Petr Havlík, Michael Obersteiner, Erwin Schmid, Uwe A. Schneider AND MANY OTHER COLLABORATORS International Institute for Applied Systems Analysis (IIASA), Forestry Program, Austria University of Natural Resources and Applied Life Sciences, Vienna (BOKU), Department of Economics and Social Sciences, Austria University of Hamburg, Sustainability and Global Change (FNU), Germany BECOTEPS Workshops – Non Food Chains, Brussels, 6-8 October 2009

What I will NOT talk about!! – European Policywww.cc-tame.eu Value of R&D policy portfolios Impact of stable expectations on investment (Climate Policy) Flexibility (Fuel Switching,polyproduction) Portfolio Economies of Scale (BE&CCS vs. PolyPr) 2

…Biomass: The Serving Butler for Multiple Masters Climate Protection Energy Security Rural Development

Global Energy Portfolio – 2DG Target Source: Obersteiner et al. forthcoming

Land is Finite Biomass Availability

6 II. Model: GLOBIOM Global Biomass Optimization Model Coverage: the Earth, Ag-For-Biomass Basic resolution: 28 regions

7 Wood Processing Bioenergy Processing Livestock Feeding Unmanaged Forest Managed Forest Short Rotation Tree Plantations Cropland Grassland Other Natural Vegetation Energy products: Ethanol (1 st gen.) Biodiesel (1 st gen.) Ethanol (2 nd gen) BTL Heat Power Gas Fuel wood Forest products: Sawnwood Woodpulp Livestock: Animal Calories Crops: Barley Corn Cotton … II. Model presentation: Supply chains

BIOPHYSICAL INPUT DATA Simulation Units (SimU) = HRU & PX30 & Country zone Source: Skalský et al. (2007)

9 Weather Hydrology Erosion Carbon sequestration Crop growth Crop rotations Fertilization Tillage Irrigation Drainage Pesticide Grazing Manure Processes Major outputs: Crop yields, Environmental effects (e.g. soil carbon, ) 40 crops (>85% of harvested area) 4 management systems: High input, Low input, Irrigated, Subsistence II. Model presentation: Cropland - EPIC

10 II. Model presentation: EPIC - Yields

11 II. Model presentation: Forests – G4M Step 2: Forest growth functions estimated from yield tables Major outputs: Mean annual increment Tree size Sawn wood suitability Harvesting cost

12 Productivity distribution II. Model presentation: Forest plantations

Woody Bioenergy Supply for B1 (Price < 6$/GJ) Source: Rokitianskii et al. 2006

14 III. Model application for iLUC Simulation horizon: 2000–2020 Main drivers: Population (IIASA SRES projections) Diets (FAO, 2006) Bio-energy demand (POLES team, JRC Seville, and WEO, 2008) (GDP, technological change,…) Scenarios 1st dimension: +/- 100 biofuel mandates WEO 2020 reference 2nd dimension: POLICIES 1. Global scale of mandates – EU27 x World 2. Trade with biofuels – YES x NO 3. Deforestation allowed – YES x NO

15 III. Model application: Scenarios setting

Mha, based on WEO 2020 targets, If not constrained (e.g. by REDD) important deforestation occurs World biofuel targets, no trade World biofuel targets, with trade EU biofuel targets, no trade EU biofuel targets, with trade Deforestation due to biofuels expansion

In Mha, EU mandates in 2020 put pressure on deforestation elsewhere even without trade – iLUC! South America Pacific Asia Africa South Asia South America Pacific Asia Africa South Asia Deforestation due to EU biofuel expansion With tradeWithout trade

Crop price index, avoiding deforestation further increases the effect of biofuels on crop prices With trade, allowing deforestation With trade, preventing deforestation Without trade, allowing deforestation Without trade, preventing deforestation World biofuels expansion and crop prices

19 Avoiding deforestation further increases the effect of biofuels on crop prices.

Crop Price Index BTL ETHANOL Source: Havlik et al. 2008

21 Crop management adjustments necessary to avoid higher price increases.

22 Biofuel mandates lead to increases of Soil N2O emissions. REDD policies may slow them down.

Biofuel policy benefits Time is crucial!!!!

29 V. Conclusions iLUC - Biofuel expansion generates important iLUC GHG emissions. - iLUC depends more on the possibility to source biofuels efficiently on international markets than on the global scale of production, ALTHOUGH for the larger scale iLUC per energy unit increases. - Policies (like REDD) aiming at reducing the negative (i)LUC effects will fortify the pressure on crop prices, UNLESS management systems adapted (feasible?) - Unit iLUC effects contingent on the global multiple policy setting to be taken into account if iLUC factors should be calculated

…Biomass: The Serving Butler for Multiple Masters Climate Protection Energy Security Rural Development R&D now! Diffuse later! Trade & LCA! Stable Expectations