Case Study
When ‘responsible’ becomes ‘irresponsible’: biofuels
in the USA and Brazil
Sally Gee, Jakob Edler
University of Manchester
Contact:
Sally Gee: [email protected]
Preparation date:
September 2013
Document version: final
Introduction
A longitudinal study of the biofuels innovation system presents an opportunity to examine
governance challenges when socio-political perceptions of what is ‘responsible’ change. Research and innovation are continuous socio-economic processes. Technologies that are broadly regarded as responsible can become ‘irresponsible’, as new knowledge emerges over time,
or as technologies are applied in different ways and contexts. This challenges existing governance arrangements and calls for governance changes to arrive at a framework that is aligned
with the new understanding of responsibility.
The case is an exemplar of an innovation system transformation. This is an important approach
to include in a portfolio of case studies undertaken to examine de-facto RRI. Taking a mesolevel perspective has a number of advantages: it enables an examination of the challenges
associated with governance when innovation occurs at the interface of sectors; captures diversity of actors and interconnections between them; allows consideration of the portfolio of
governance instruments employed to direct R&I, as well their relative effectiveness. A longitudinal case study through an innovation systems lens enables observation and analysis of processes at the macro level (e.g. re-direction of the technological trajectory) as well as at the
micro level (e.g. the formation of particular governance instruments).
This case supports the development of a governance framework by delivering insights into the
processes accompanying shifting normative framings of responsible outcomes and into the
associated governance challenges, as well as processes involved in the creation of new governance arrangements.
Case summary
Biofuels have been politically perceived as a ‘responsible’ solution to energy security, climate
change and economic development challenges since the 1970s (Nuffield Council on Bioethics,
2011). The emergence of the biofuels industries in Brazil and the USA are examples of governments intervening to solve these challenges. A high degree of coordination was undertaken by
the state in both countries, reflecting the unique role of governments for societal steering
(Meadowcroft, 2010) towards collectively defined responsible outcomes (in the ‘public good’).
Policy intervention in these countries has been effective and production volumes of biofuels
dramatically increased in both countries. Over 85% of the global bioethanol supply is produced
by Brazil (from sugar cane) and the USA (from corn)(Renewable Fuels Association, 2012).
In the mid-2000s the perception of biofuels as a ‘responsible’ fuel was challenged. A global
controversy surrounding biofuels emerged and was three-pronged: 1) changing scientific interpretations of the environmental impacts of biofuels, particularly indirect land use change,
raised ambiguity about the environmental benefits of biofuels(Searchinger et al, 2008); 2) food
price spikes resulted in controversy around the use of agricultural commodities for fuel rather
than food (EAI, 2007); and 3) social welfare issues, particularly around workers rights in developing countries, raised concerns about policy support and consumption of biofuels in developed countries. These concerns created ambiguity around whether biofuels were a ‘responsible’ solution to energy security, climate change and economic development challenges.
Innovation systems can be understood as problem oriented (Metcalfe and Ramlogan, 2008),
i.e. they are formed to solve problems. Problems (or problem complex) are continually redefined as solutions produce new or modified problems and the innovation system evolves in
response to new definitions of a problem. The emergence of new scientific knowledge combined with unintended social consequences from the industrial scaling up of biofuels production and consumption altered the problem the biofuels innovation system was oriented towards (Gee and McMeekin, 2011). This controversy created a governance crisis. The Brazilian
government’s response was minimal, partly because Brazilian bioethanol produced from sugar
cane maintained its perception as the most environmentally and economically sustainable
biofuel. However, the government agencies responsible for renewable fuels in the USA redirected the biofuels innovation system away from corn-based bioethanol towards cellulosic
ethanol by extending existing legislation.
Cellulose is the basic component of plant cell walls. Unlike corn-based biofuels the production
of cellulosic ethanol does not compete directly with food production as cellulose cannot be
digested by humans. Instead, cellulosic ethanol can be produced from agricultural byproducts, as well as other feedstocks, such as cellulose rich solid municipal waste. This reduces
demand on agricultural land. The production of cellulosic ethanol also partially resolves the
main scientific concerns about the environmental benefits of biofuels. Compared to petro-
leum, ethanol produced from cellulosic feedstocks may reduce overall GHG emissions by 85%
(Wang, 2005) (significantly higher than corn-ethanol, e.g. Huanga et al, 2009) and can reduce
carbon dioxide emissions to nearly zero (Solomon et al, 2007). However, a number of scientific
and industrial challenges impeded the production of cellulosic ethanol on an industrial scale.
To overcome these challenges, scientific and industrial R&D was directed towards alternative
feedstocks and processing techniques, dependent on emerging technologies (including transgenic technologies and synthetic biology). Two main governance instruments are identified
that were extended to address the scientific and industrial challenges.
First, the Biomass R&D Act (2000) required the DOE and USDA to integrate and increase funding for biomass R&D, and authorized the agencies to promote the industry. The global biofuels
controversy affected change in funding of biomass R&D. In 2008, the Biomass Research and
Development Initiative was amended by the Food, Conservation and Energy Act (Biomass
Board, 2013). This amendment re-directed funding away from the mature corn ethanol industry and increased support for the development of advanced biofuels, particularly cellulosic
ethanol.
Second, the Renewable Fuels Standard (RFS1) was established by Energy Policy Act (2005) and
is the most significant renewable energy policy in the USA (Slating and Kesan, 2012). The RSF is
unusual in affecting the demand side. In 2007, the Clean Energy Act was rebranded the Energy
Independence and Security Act (EISA)(de Beer, 2011) and extended the RFS (RFS2). Mandates
for the minimum level of renewable fuels use were increased, as were mandated levels for use
of advanced biofuels, particularly cellulosic ethanol. EISA secured a market for cellulosic ethanol promoting industrial investment. In 2013, 1 million gallons of cellulosic ethanol was produced in the USA, though this is short of the federal madate of 6 million gallons (Gardner,
2014).
Lessons for Res-AGorA
First, the biofuels case demonstrates that socio-political perceptions of what is ‘responsible’ do
change over time. Innovation is a protracted and distributed process. This presents particular
challenges for the governance of RRI, as actors and knowledge change throughout the innovation process. The case emphasizes the importance of innovation production, adoption and
consumption for achieving ‘responsible’ outcomes. Governance of RRI should therefore be
reflexive and able to cope with changing normativities.
Second, the biofuels case is an exemplar of state intervention in the emergence and evolution
of innovation systems. Arguably the state is uniquely positioned to steer innovation systems
towards normatively defined ‘responsible’ outcomes, particularly when these represent societal interests that are not addressed through short term economic incentives. In the USA, both
corn ethanol and – after the normative challenge - cellulosic ethanol were supported by the
state through traditional governance instruments, such as R&D funding, as well as direct market intervention.
Third, as innovation often occurs at the intersection of sectors (in this case agriculture, energy
and materials), we need to understand the changing responsibility discourse in relation to governance & the ‘policy mix’ across those domains, As governance tools are interdependent, a
holistic approach to actors, arrangements and instruments may help reduce unintended consequences.
Fourth, the case suggests that emerging, non-mainstream technologies can be subject to more
scrutiny than established technologies. The case is concerned with the development of biofuels, a form of liquid fuel. There was no comparable public debate around oil (the dominant
liquid fuel) when the controversy surrounding biofuels emerged. A lack of attention (or direct
comparison) to mainstream, long established technologies or products may have a negative
impact on RRI debates and governance.
Finally, the consumption of biofuels by developed countries, raised concerns about social welfare in less developed biofuel producing countries (e.g. Brazil). The case reminds us that that
innovation, and therefore responsibility, has a global reach. The governance of RRI framework
should recognise global interactions have an influence on process and outcomes.
References
de Beer, J. (2011) Network Governance of Biofuels Available
http://ssrn.com/abstract=2018002 or http://dx.doi.org/10.2139/ssrn.2018002
at
SSRN:
Gardener, T. (2014) UPDATE 2-U.S. may lower 2013 target for cellulosic ethanol, Reuters:
http://uk.reuters.com/article/2014/01/23/usa-ethanol-cellulosic-idUKL2N0KX1IS20140123
Gee, S and McMeekin, A (2011) Eco-innovation Systems and Problem Sequences: the contrasting cases of US and Brazilian biofuels, Industry and Innovation, Vol. 18, no. 3, p 301-316.
Biomassboard (2013): http://www.biomassboard.gov/
Huanga, H.; Ramaswamya, S.; Al-Dajania, W.; Tschirnera, U.; Cairncrossb, R. A. Effect of biomass species and plant size on cellulosic ethanol: A comparative process and economic analysis. Biomass Bioenergy. 2009, 33, 234-246.
EIA, (2007) Energy Policy Administration: In 2006, 20% of the total US corn supply was reallocated to fuel ethanol production.
Meadowcroft, J. (2010) Who is in Charge here? Governance for Sustainable Development in a
Complex World, Journal of Environmental Policy and Planning, 9:3-4,p299-314.
Metcalfe, J. S. and Ramlogan, R. (2008) Innovation systems and the competitive process in
developing economies, The Quarterly Review of Economics and Finance, 48(2), pp. 433–446.
Nuffield Council on Bioethics (2011) Biofuels: ethical issues; report accessed at:
http://www.nuffieldbioethics.org/biofuels-0
Renewable Fuels Association (6 March 2012). "Acelerating Industry Innovation – 2012 Ethanol
Industry Outlook". Renewable Fuels Association.
Searchinger, T., Heimlich, R., Houghton, R. A., Dong, F., Elobeid, A., Fabiosa, J., Tokgoz, S.,
Hayes, D. and Yu, T. (2008) Use of US croplands for biofuels increases greenhouse gases
through emissions from land-use change, Science, 319, pp. 1238–1240.
Slating, T.A. and Kesan, J.P. (2012) The Renewable Fuel Standard 3.0?: Moving Forward with
the Federal Biofuel Mandate, Illinois Public Law Research Paper No. 13-06
Solomon, B. D.; Barnes, J. R.; Halvorson, K. E. Grain and cellulosic ethanol: History, economics,
and energy policy. Biomass Bioenergy. 2007, 31, 416–425.
Wang, M. (2005) Updated Energy and Greenhouse Gas Emissions Results of Fuel Ethanol:
http://www.transportation.anl.gov/pdfs/TA/354.pdf
Towards Anticipatory Governance
of Responsible Research and
Innovation
The objective of the Res-AGorA project is to develop a comprehensive governance framework for responsible research and innovation (RRI). This will be a contribution to the EU ambition of becoming a
genuine Innovation Union by 2020 striving for excellent science, a competitive industry and a better
society without compromising on sustainability goals as well as ethically acceptable and socially desirable conditions.
The goal of the Rea-AGorA project will be achieved through extensive case study research about existing
RRI governance across different scientific technological areas, continuous monitoring of RRI trends in 16
European countries, and constructive negotiations and deliberation between key stakeholders. This
comprehensive empirical work will be the building blocks of the creation of a governance framework for
RRI.
The case study summarised in this document is output of Res-AGorA’s extensive empirical programme
(Work Package 3).
More information at www.res-agora.eu
Contact for Res-AGorA’s case study programme (WP3)
Dr. Sally Randles
Manchester Institute of Innovation Research MIoIR
[email protected]
Prof. Dr. Jakob Edler
Manchester Institute of Innovation Research MIoIR
[email protected]
Res-AGorA Co-ordinator
Prof. Dr. Ralf Lindner
Fraunhofer Institute for Systems and Innovation Research ISI
[email protected]
Acknowledgement
Co-funded by the
European Union
This project is receiving funding from the European Union’s Seventh Framework Programme for
research, technological development and demonstration under grant agreement no 321427.