Economy versus biodiesel

One of the most important reason why people started to produce biofuels, apart from national energetic security, was the will to find an alternative to conventional resources (oil, gas, coal). For instance based on constantly changing statistics the oil will be depleted in next 40-50 years (those estimations can be inaccurate as new crude oils reservoirs are discovered or new technologies are introduced, for instance currently unprofitable fields may give good yield in future, this can be seen today for recently discovered shale oils).

It should be stressed that production of biodiesel (or any biofuel in principle) is still more expensive than standard oil extraction. Nevertheless, the governments in the European Union force to use 5% of biodiesel blend with all sold petroleum oil. To compensate the difference the tax put on biodiesel is lowered, and partly hided in the price of other fuels. This is somehow connected with another worrying phenomenon. Biodiesel crops substituted other food plants which resulted in food price increase (the overall area accessible for plants for human and animals was shortened). Eventually, it caused increase of food prices. This can be easily seen all over the world, but the most extreme example can be Mexico, one of the leading biodiesel producer. In the end of 2010, food prices were so height that average Mexican cannot afford to feed his family and people went onto streets.

 



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