ROME (Reuters) - Biofuels will not solve the world’s energy problem, the chief executive of Royal Dutch Shell said on Sunday, amid growing criticism of their environmental and social benefits.
The remarks follow protests in Brazil and Europe against fuels derived from food crops. Food shortages and rising costs have set off rioting and protests in countries including Haiti, Cameroon, Niger and Indonesia.
“The essential point of biofuels is over time they will play a role,” Jeroen van der Veer, chief executive of Royal Dutch Shell, told reporters on the sidelines of the International Energy Forum.
“But there are high expectations what role they will play in the short term.”
The oil minister for Qatar, a member of the Organization of the Petroleum Exporting Countries, had harsher words to say about biofuels at the energy forum, a gathering of producers and consumers.
“Now the world is facing a shortage of food,” Qatar’s Abdullah al-Attiyah said, answering a question at a news conference.
“I don’t think we should blame oil, we should blame biofuels.”
Biofuels are set to play a growing role. The European Union agreed last year to get 10 percent of all transport fuel from biofuels by 2020 to help fight climate change.
But concern over meeting the biofuels targets has fuelled fears that sky-high food prices may rise even further if fertile arable land in Europe is turned over to growing “energy crops”.
First-generation biofuels usually come from food crops such as wheat, maize, sugar or vegetable oils. They need energy-intensive inputs like fertilizer, which make it harder to cut emissions contributing to climate change.
Second-generation biofuels would use non-food products such as straw and waste lumber. So far, their production has been mostly experimental.
“Biofuels are all about how you develop them without unintended consequences. It is not only the competition with food, it is also the competition for sweet water in the world,” Shell’s Van der Veer said.
An official from the International Energy Agency also said the impact of biofuels should have been forseen.
“Maybe we should have anticipated them better,” the IEA’s deputy executive director, William Ramsay, said.
“But when you have a combination of things happening at the same time -- increasing demand for energy-intensive food, terrific droughts, things like that -- then add to that the competition in certain markets for food and fuel, the preconditions are there.”
Reuters Breakingviews is the world's leading source of agenda-setting financial insight. As the Reuters brand for financial commentary, we dissect the big business and economic stories as they break around the world every day. A global team of about 30 correspondents in New York, London, Hong Kong and other major cities provides expert analysis in real time.
Sign up for a free trial of our full service at https://www.breakingviews.com/trial and follow us on Twitter @Breakingviews and at www.breakingviews.com. All opinions expressed are those of the authors.