International policies on bioenergy and biofuels

Abstract

This chapter provides an overview of international biofuel polices and their main impacts on food prices and land use. Global biofuel production has experienced a rapid growth by increasing from almost a zero level in 1970 to 29 billion gallons in 2011; the United States, the European Union, and Brazil account for around 90 % of the global biofuel production. Biofuel policies are widely implemented in most developed and many developing countries. Most commonly used biofuel policy instruments are biofuel mandates and consumption subsidies (tax credit and tax exemptions). These policies determine biofuel prices, depending on which instrument is binding. Biofuels may also have unintended effects on other markets. In particular, interlinkages between biofuel and agricultural productions lead to food price responses and land use adjustments.