Wasteland. Hohenheim University (Germany) A Concept For Simultaneous Wasteland Reclamation Fuel Production And Socio Economic Development in Degraded Areas in India 2007. More info

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Published on January 10, 2009

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A concept for simultaneous wasteland reclamation, fuel production,
and socio-economic development in degraded areas in India. Posted by Youmanitas Energy Farms Foundation The Netherlands.

12 George Francis, Raphael Edinger and Klaus Becker / Natural Resources Forum 29 (2005) 12–24 Natural Resources Forum 29 (2005) 12–24 A concept for simultaneous wasteland reclamation, fuel production, and socio-economic development in degraded areas in India: Need, potential and perspectives of Jatropha plantations George Francis, Raphael Edinger and Klaus Becker Abstract The concept of substituting bio-diesel produced from plantations on eroded soils for conventional diesel fuel has gained wide- spread attention in India. In recent months, the Indian central Government as well as some state governments have expressed their support for bringing marginal lands, which cannot be used for food production, under cultivation for this purpose. Jatropha curcas is a well established plant in India. It produces oil-rich seeds, is known to thrive on eroded lands, and to require only limited amounts of water, nutrients and capital inputs. This plant offers the option both to cultivate wastelands and to produce vegetable oil suitable for conversion to bio-diesel. More versatile than hydrogen and new propulsion systems such as fuel cell technology, bio-diesel can be used in today’s vehicle fleets worldwide and may also offer a viable path to sustainable transportation, i.e., lower greenhouse gas emissions and enhanced mobility, even in remote areas. Mitigation of global warming and the creation of new regional employment opportunities can be important cornerstones of any forward looking transportation system for emerging economies. Keywords: Sustainable transportation; India; Wasteland; Jatropha; Bio-diesel; Employment; Development, Renewable energy. 1. Introduction. Global search for alternative fuels introduced into the market. The increases in efficiency and performance of automobile engines as well as hybrid elec- Today’s transportation services in industrialized countries tric drive systems that are now on the verge of commer- are primarily based on fossil fuels, especially crude oil cialization have set a very high barrier to fuel cell systems. derivatives. The spread of this fossil-energy-intensive Economic conditions and resource availability in develop- approach to developing countries and economies in transi- ing countries are considerably different from those in in- tion with large populations may be constrained by limited dustrialized countries. Existing vehicle fleets in developing resource availability and concerns about environment and countries primarily rely on conventional combustion engines, human health. The transport sector is emerging as the larg- generally with an extraordinarily long service life, resulting est consumer of liquid fuel worldwide. Strategic think-tank in low average efficiencies and a high level of emissions. In alliances have been formed between the automobile and urban areas, vehicle emissions and their consequences for energy industries, particularly in industrialized countries, human health have become urgent problems, while in remote to develop future transportation concepts and fuel options. regions, fuel distribution remains a challenge. Several coun- The German transport energy strategy has identified hydro- tries in the tropics also suffer from limited financial means gen and methanol as the most promising alternative to maintain a state-of-the-art vehicle fleet and quality fuel fuel options for the future German transportation network. production and distribution systems. On the other hand, these However, the technological challenge of bringing fuel-cell regions often enjoy abundant sun light, that can be used vehicles to the market as well as producing methanol or to generate both electric and thermal power, as well as for hydrogen from renewable resources in a cost-effetive way cultivating biomass. However, in many tropical regions land have so far prevented this promising option from being degradation and soil erosion have been identified as major threats to existing land-use patterns. We discuss here a George Francis and Klaus Becker are researchers at the Department of biofuel production option that simultaneously addresses Aquaculture Systems and Animal Nutrition, Institute for Animal Production diverse problems in the tropical regions mentioned above in the Tropics and Subtropics, University of Hohenheim, Stuttgart, Ger- taking advantage of the warmer climate prevailing there. many. E-mail:, General guidelines on sustainable development have been Raphael Edinger, of Aichtal, Germany, is a guest lecturer at the Univer- outlined in Agenda 21 (UN, 1992), adopted by the United sity of Hohenheim. E-mail: © 2005 United Nations. Published by Blackwell Publishing, 9600 Garsington Road, Oxford OX4 2DQ, UK and 350 Main Street, Malden, MA 02148, USA.

George Francis, Raphael Edinger and Klaus Becker / Natural Resources Forum 29 (2005) 12–24 13 Figure 1. Changes in the Indian gross domestic product in 1993–1994 prices, in billions of US dollars (US$1 = Rs 46). Source: India (2004). Nations Conference on Environment and Development various sectors to GDP has changed dramatically over the (UNCED),1 and concrete approaches to energy sustainability last 50 years (Figure 1), pointing clearly to a paradigm shift have been defined in the Kyoto Protocol. Three concepts in its developmental pattern towards high resource use. can be extracted from these documents that relate closely Economic progress and the resultant increased demand to a discussion of sustainable transportation: for transportation have been driving the demand for auto- mobiles. In the past 10 years of beginning economic liber- • Secure and economically viable energy supply; alization and high GDP growth rates, total transport demand • Climate and soil protection; and has been growing at about 10% per year. Currently, about • Social development and equity. 800 billion freight km and 2,300 billion passenger km are delivered by the transport system (India, 2002). Traffic Tying these three concepts together, the production of patterns have changed over the last five decades with a sig- biofuels from eroded soils has found a place in the agenda nificantly increased use of roads compared to other means of academic and business think tanks on sustainable devel- of transport (e.g., rail, ship), with the percentage of freight opment. This article outlines the perspectives, challenges, and passenger transport by roads increasing to 60 and 80 and limitations of Jatropha curcas, a suitable biomass plant, respectively in 2001 compared to 10 and 25 in 1951. and discusses the economic and ecological context of real- The number of vehicles on Indian roads has increased ising this approach in India. rapidly over the last decade from 20 million in 1991 to about 50 million in 2000a (Figure 2). According to India Vision 2020 (India, 2002), a docu- 2. Context for promoting sustainable transportation ment issued by India’s Planning Commission, calculating in India from current growth rates, two-wheeler ownership in cities with more than 100,000 inhabitants is likely to rise from 102 to 393 per 1,000 people in the next 20 years, while the 2.1. Population growth, economic progress and the number of cars would increase from 14 to 48 per 1,000. changing profile of the transport sector India is projected to become the third largest consumer of India is home to over a billion people, about one-sixth of transportation fuel in 2020, after the USA and China, with the world’s population. The population continues to grow at consumption growing at an annual rate of 6.8% from 1999 1.93% per annum, which is well above the global average to 2020. (India, 2001a). The population of India has nearly tripled in the last 50 years, from 361 m in 1951 to 1.027 bn in 2001. 2.2. The energy challenge: India’s demand and supply The country’s economy has also been growing rapidly in of crude oil the last decade, with real GDP growth rates remaining consistently over 5% (India, 2004). The contribution of the India’s economy has often been unsettled by its need to import about 70% of its petroleum demand (India, 2004) from the highly unstable and volatile world oil market. This problem looks likely to become aggravated with the 1 Held in Rio de Janeiro in June 1992.

14 George Francis, Raphael Edinger and Klaus Becker / Natural Resources Forum 29 (2005) 12–24 Figure 2. Growth in the number of vehicles compared to increase in per capita net national product give clues to possible future change patterns. Source: India (2004). Figure 3. Forecast of oil production, consumption, number of vehicles and transport oil consumption in India. Source: International Energy Agency (2002). foreseen increases in consumption and demand (Figure 3). export balance under pressure. The current dramatic price According to a study by British Petroleum, even today, movements in the international crude oil markets confirm 68% of Middle East crude oil export is consumed in the these concerns. Asian countries with merely 32% exported to Europe, India’s yearly oil import bill, currently about US$17–18 Africa and America (BP, 2004). Considering the forecast billion (India, 2004) is projected to increase manifold until economic development of Asia as well as the not yet 2030. In view of the current uncertainties in the world oil saturated energy markets of North and South America and market, any prediction of the foreign exchange outflows is Europe, conflicts of distribution are likely in coming years likely to be inaccurate. What is certain, however, is that the between the US and European countries versus the devel- oil import bill will continue to be an enormous burden on oping nations on the one hand, and between the Asian India’s balance of payments. Thus energy, and especially countries themselves on the other. In the face of shrinking oil security, has become a key issue for India, resulting global crude oil reserves, rising demand may raise crude in recent policy initiatives by the Government in the area oil prices significantly and set the Indian national import/ of biofuels.

George Francis, Raphael Edinger and Klaus Becker / Natural Resources Forum 29 (2005) 12–24 15 Figure 4. Energy related CO2 emissions of the largest emitters in the world. Sources: UN (2004), International Energy Agency (2002). 2.3. Air pollution and legislative approaches manufacturers have made a commitment to reduce average vehicle emissions to 140 grams carbon dioxide per km Vehicle emissions are a rapidly growing contributor to the by 2008. The European Union aims to install legislation increase in atmospheric greenhouse gas levels and urban enforcing a 120 gram limit by 2012 if vehicle manufac- air pollution. According to the World Energy Outlook 2002 turers fail to make voluntary commitments. The EU target (IEA, 2002), per capita emissions of OECD and transition for introducing alternative and renewable fuels is shown in economies are projected to reach 13 tons and 11 tons respect- Table 1. These targets have stimulated European research ively in 2030. India’s per capita CO2 emission is projected to and development activities for alternative fuel production increase to 1.6 tons by 2030. India’s huge population, how- and conversion technologies and established a congenial ever, aggravates the net emissions into the atmosphere. Even climate for private investment. In Germany, the bio-diesel with a per capita CO2 emission of only one ton per year, industry was encouraged to intensify activities, and new India is already the world’s fifth largest emitter (Figure 4). players, especially in the waste wood and biomass conver- In Indian cities, in line with worldwide trends, the sion sector, have entered the process of technological de- transportation sector is becoming the major source of air velopment aiming at market introduction of their biofuels pollution. The rapid growth of the sector in conjunction in cooperation with automotive and energy companies. with numerous factors, such as: the high vehicle density Increasing greenhouse gas emissions and deforestation in Indian urban centres; a predominance of two-stroke are considered to have contributed to the increased fre- two-wheelers; older and inadequately maintained vehicles; quency of natural disasters that cost the world US$60 bil- and low quality fuels, have resulted in a volatile situation lion during 2003 (Munich Re, 2003). Weather related with regard to air pollution in major cities. The number of disasters rose dramatically between 1993–1997 and 1998– vehicles in the capital city of New Delhi increased 15 times 2002, from an annual average of 200 to 331 major events over the past 3 decades (currently about 3 million vehicles per year (IFRCS, 2003). Population growth and unequal for close to 14 million people) and the share of motor social development have exacerbated the vulnerability of vehicles in air pollution increased from 23% in 1971 to our societies to the fragility of the world’s climate system 73% in 2001 (India, 2004). The projected growth of the and the impacts of natural events. transport sector is set to exacerbate the pollution problem (Figures 5 and 6). 2.4. New vehicle technologies versus new fuel options The transport sector as a major consumer of oil and emitter of atmospheric pollutants has attracted the most To make transportation less energy intensive and more eco- regulatory efforts towards reducing emissions and promot- friendly, there are principally two solution paths that could ing alternative fuels. The dramatic pollution situation in be followed in parallel. Firstly, increases in energy effici- New Delhi has resulted in a ban on diesel driven com- encies can be expected from: advanced internal combustion mercial carriers within the city limits. In Europe, vehicle engines with direct-injection technologies; vehicles using

16 George Francis, Raphael Edinger and Klaus Becker / Natural Resources Forum 29 (2005) 12–24 Figure 5. Forecast of total and transport related CO2 emissions and their rate of growth. Source: International Energy Agency (2002). Figure 6. Current and projected atmospheric emissions in India under two scenarios. Source: India (2002). systems may be introduced in future generations of vehicles. Table 1. Future market share targeted for selected fuels by European Union (%) Selecting appropriate fuels and fuel production technologies are a vital prerequisite for designing a concept for future 2005 2010 2020 transportation systems, and for the competitiveness of both % % % energy and automobile companies. Fuel cell vehicles pow- ered with hydrogen have emerged as the favourite long- Biofuels 2 5.75 8 Hydrogen 0 0 5 term solution for the automobile industry. However, mass Natural gas 0 2 10 market introduction and penetration of fuel cell vehicles is Total 2 7.75 23 not likely to occur before 2015. Even after market intro- duction of fuel cell vehicles, biofuels — in pure form or lightweight materials; advanced electronic motor manage- blended with conventional fuels — are likely to be used for ment; and hybrid drive systems; as well as improvements the coming decades to run the existing fleet of internal in aerodynamics and rolling resistance. Secondly, new drive combustion vehicles.

George Francis, Raphael Edinger and Klaus Becker / Natural Resources Forum 29 (2005) 12–24 17 Table 2. Wasteland area in India that could be partially or fully cultivated with Jatropha (in million ha) Category Total % of total wastelands geographical area covered Gullied and/or ravined land 2.1 0.65 Land with or without scrub 19.4 6.13 Shifting cultivation 3.5 1.11 Underutilised/degraded/notified forest land 14.06 4.44 Degraded pasture/grazing land 2.6 0.82 Degraded land under plantation crop 0.58 0.18 Sands (inland and coastal) 5.00 1.58 Mining/industrial wasteland 0.13 0.04 Barren rocky/stony waste/sheet rock area 6.46 2.04 Steep slopes 0.77 0.24 Figure 7. Projections of total populationa, population density, and Other 9.25 2.94 availability of cultivated land for India. Total wasteland area 63.85 20.17 Sources: India (2004), UN (2002). Note: a According to the medium fertility scenario projected by the Source: India (2000). United Nations. Biofuels will, in fact, play a significant role in offering a short- and medium-term solution if projected emission 3. India’s strategy on biofuels and land recovery targets are to be adhered to. Conventional vehicles can be operated by blending biomethanol, bioethanol or bio-diesel from 3–20% with conventional gasoline and diesel from The Indian Government regards biofuels as a feasible crude oil. This approach may help to establish a market for option for augmenting future fuel supply. The document, renewable fuels since no new refuelling infrastructure is India Vision 2020 (India, 2002), presented by the Planning necessary and the fuel is compatible with today’s vehicle Commission as a framework for policy planning in the fleet. This would be a particularly attractive strategy for em- coming decades, mentions the potential of biofuels in gen- erging developing countries, such as India, as no additional eral and specifically refers to plantations of Jatropha curcas cost commitments are required on the infrastructure side. to produce large quantities of bio-diesel. According to this document, cultivation of 10 million ha of this crop could generate 7.5 million metric tons of fuel annually, while 2.5. Land degradation is threatening food security generating year-round employment for 5 million people. The majority of India’s population lives in rural areas and The Government has already successfully implemented is dependent on land for its livelihood. Agriculture pro- an ethanol doping programme for gasoline in nine states. vides direct employment to 57% of the Indian population Legislation was established mandating the blending of (India, 2004). About 35% of the total population of the 5% ethanol into the petrol from 30 September 2003 in nine country still falls under the poverty line, however, the sec- major sugarcane growing states (Andhra Pradesh, Gujarat, tor remains largely neglected in terms of new investments. Haryana, Karnataka, Maharashtra, Punjab, Tamil Nadu, The current total annual investment in agriculture in India Uttar Pradesh and Goa) and the four Union Territories of is below 2% of GDP (India, 2004). Improper land use and Daman and Diu, Dadra and Nagar Haveli, Chandigarh and population pressure over several years have resulted in Pondicherry. The measure is soon to apply to the whole of extensive degradation of agricultural land in the country India, showing the Government’s seriousness in enlarging (see Table 2). The area of land affected by some form of the market share of biofuels. soil degradation has increased from about 112 million ha Taking into account the multiple benefits of large-scale in 1950 to about 174 million ha in 2000 (India, 2000). bio-diesel production from Jatropha plantations in wasteland Table 2 shows total area and percentage of land that has regions, the Government has announced a ‘National Mis- been classified as severely degraded and lying idle by sion on Bio-diesel’ that is to be implemented on an area India’s Department of Land Resources (India, 2000). of 400,000 ha over the next five years (India, 2003a). As The per capita availability of land declined from 0.89 ha a step towards a mandatory legislative framework, the in 1951 to 0.3 ha in 2001 and the per capita availability of Government also intends to initiate action towards the issue agricultural land declined from 0.48 ha in 1951 to 0.14 ha of a notification to blend 5% bio-diesel with petro-diesel in 2001 (India, 2004). The trend of increasing population in 10% of the districts in the country from 2005 onwards (Figure 7) and declining available agricultural land leaves subject to the availability of bio-diesel (India, 2003b). The no other option but to reclaim degraded lands for product- then Minister of State for Petroleum and Natural Gas has ive use. been quoted in news reports as saying that the Government

18 George Francis, Raphael Edinger and Klaus Becker / Natural Resources Forum 29 (2005) 12–24 aims at commencing implementation of blending up to 20% Table 3. Characteristics of Jatropha bio-diesel compared to European specifications bio-diesel with diesel by the year 2011–12. The Government of India has also made an effort to Remarks a Characteristic Jatropha European include major oil companies (where they are major share- bio-diesel standard holders) in the planning process. Indian Railways (also fully Density (g cm−3 at 20°C) + owned by the Indian central Government) has expressed an 0.87 0.860–0.900 + Flash point (°C) 191 >101 interest in replacing 5% of its total diesel consumption (about +++ Cetane no. (ISO 5165) 57–62 >51 1,400 tons per year) with bio-diesel. Towards this venture, + Viscosity (mm2/s at 40°C) 4.20 3.5–5 (40°C) Indian Railways is partnering with a major mineral oil com- Net cal. val. (MJ/L) 34.4 – – pany for the supply of the bio-diesel fuel, and has offered (or 39.5 MJ/g) <120 + railway lands for the cultivation of oil bearing trees. Iodine No. 95–106 <0.02 + Sulphated ash 0.014 <0.3 ++ Carbon residue 0.025 4. A concept for regional transportation, Sources: Gübitz et al. (1999) and authors’ own data. soil protection, and economic development Note: a + indicates that Jatropha performs better than the European stand- ard for diesel. 4.1. Jatropha curcas — characteristics of the ‘energy’ plant Table 4. Emission characteristics of soy bio-diesel compared to petro-diesel 2 Jatropha curcas, belonging to the family Euphorbiaceae, is a low-growing tree, native to South America, but widely Type of emission Soy-bio-diesel emissions as cultivated also throughout Central America, Africa and Asia. % of petro-diesel emissions Jatropha, which is not eaten by animals, is a vigorous, Total unburned hydrocarbons 7% drought- and pest-resistant plant that is planted in tropical Carbon monoxide 50% countries principally as a hedge, protecting cropland from Particulate matter 70% freely ranging cattle, sheep and goats. India already has a NOx 113% shortage of edible oil and cannot afford to divert any of its Sulphates 0% existing harvest of vegetable oil for bio-diesel production. Polycyclic aromatic hydrocarbons (PAH) 20% NPAH (nitrated PAHs) 10% However, inedible oils produced from trees such as Jatropha Ozone forming potential of exhaust 50% curcas, that can grow on barren, eroded lands, under harsh climatic conditions, could be an ideal source for bio-diesel Source: USEPA (2002). under present circumstances. The popularity of Jatropha is also based on the use of its oil and other derivatives, The process uses an alkali (potassium or sodium hydroxide, although limited, for medicinal purposes and the manu- i.e., KOH or NaOH) or an acid (hydrochloric acid or sul- facture of soap. Jatropha is unique among renewable energy phuric acid, i.e., HCl or H2SO4) as catalysts, and requires sources in terms of the number of potential benefits that adding about 15% by weight of simple alcohol, e.g., metha- can be expected to result from its widespread cultivation. nol. Ethanol can also be used, which has the advantage that Its cultivation requires simple technology, and compara- it is also obtained from natural raw materials and therefore tively modest capital investment. is renewable and CO2 neutral. The yield of bio-diesel is The seed yield reported for Jatropha varies from 0.5 to about 92% of the initial weight of the Jatropha oil (Foidl 12 tons/year/ha — depending on soil, nutrient and rainfall et al., 1996). The physical and chemical properties of bio- conditions — and the tree has a productive life of over diesel produced from Jatropha oil fulfil the official inter- 30 years. An average annual seed production of about national standards for the product (Table 3). five tons/ ha can be expected on good soil when rainfall is While the engine performance of bio-diesel is generally 900–1,200 mm. The seeds contain about 30% oil that can comparable to that of diesel from fossil fuel, bio-diesel has be converted into bio-diesel by a process called trans- been reported to decrease emission of a variety of pollut- esterification, in which a simple alcohol (e.g., methanol) ants (Table 4). replaces glycerol from the vegetable oil molecules (these Life-cycle carbon dioxide emission has not yet been are triglycerides, i.e., three molecules of fatty acid molecules measured for Jatropha curcas. It has, however, been shown are attached to a glycerol molecule). The suitability of the in the United States that the use of soy bio-diesel can re- Jatropha seed oil for transesterification into bio-diesel has duce life-cycle emissions of CO2 and SO2 by 80 and 100% also been clearly demonstrated (Foidl et al., 1996; Eisa, respectively as compared to petro-diesel (USDA/USDOE, 1997; Vaitilingom and Liennard, 1997; Zamora et al., 1997). 1998). The same study has shown that in soybean bio- diesel production in the US, every unit of petroleum energy consumed produces 3.37 units of bio-diesel. The 80% 2 Note: Greek: jatros — physician and trophe — food.

George Francis, Raphael Edinger and Klaus Becker / Natural Resources Forum 29 (2005) 12–24 19 reduction in CO2-emissions has been calculated for bio- and macro nutrients required, need to be assessed in both diesel produced from soybean oil from intensive agricul- pilot and large-scale plantations. The biological require- ture (consuming about 75 litres of oil and 125 kg of chemical ment of the closely related castor seeds could provide an fertilizers per ha as well as herbicides and insecticides). estimate of the requirements for Jatropha seeds. Jatropha The life-cycle carbon dioxide emissions resulting from the plants have been found to respond better to organic manure production of bio-diesel from low-input, no-tillage, perennial than to mineral fertilizers. Some of this need could be sat- Jatropha plantations (no application of chemicals foreseen) isfied by ploughing back the fruit pulp, pruned matter etc. would be much lower and is likely to be less than 15% Jatropha has also been reported to develop a symbiosis compared to petro-diesel. with the root fungus, Mycorrhiza, which might result in The byproduct from Jatropha oil extraction is a nutrient increased efficiency in assimilating otherwise unavailable rich seed cake, containing a large amount of high quality nutrients, particularly phosphate. proteins (Makkar et al., 1998). Extracted Jatropha kernel In order to involve local communities and generate short- meal contains about 61% crude protein compared to about term financial returns for them, it is advisable to plan for 45% in soybean meal. Although the roasted seeds of certain some intercropping with shade loving annual or perennial Jatropha varieties can be eaten, the presence of various vegetables, such as red and green peppers, tomatoes, grasses toxins (phorbol esters, trypsin inhibitors, lectins, phytates) etc., as soil conditions may permit. In view of this, spacing render the raw seed cake from several other varieties un- between plants will be critical and should be taken into suitable for human consumption or as animal feed. Phorbol account from the very beginning. esters are the most potent among these toxins. The seed content of phorbol esters varies among different Jatropha 4.2.2. Oil extraction and production of bio-diesel cultivars — ranging from undetectable in the Mexican ‘non- The infrastructure for processing Jatropha should prefer- toxic’ varieties (of which the roasted seeds are eaten by ably be set up in a decentralized manner. Small-scale ex- humans) to over 6 mg per g kernel in a toxic variety from pellers of up to four to five tons/day capacity are available India. However, the raw seed cake is valuable as organic on the Indian market. For better acceptance of prospective manure3 (it has more nutrients than both chicken and cattle Jatropha cultivation among farmers, it is important that manure) and would simultaneously serve as biopesticide/ collection centres are available within easily reachable dis- insecticide due to the presence of potent but bio-degradable tances and at reduced transportation cost. Seed collection toxins, such as phorbol esters,4 adding to its value. The and oil pressing centres should be located close to the pro- leftover shell also constitutes high energy raw material duction sites to encourage investment in remote areas and (19 MJ/kg), which could be used separately. ensure that the seed cake by-product can be redistributed locally as bio-fertilizer and, in the event that detoxification becomes viable, as animal feed. 4.2. Requirements for large-scale Jatropha plantation Transesterification technology is also commercially avail- 4.2.1. Cultivation and seed production able, as is equipment that can be easily adapted to Jatropha Despite numerous projects investigating the use of Jatropha oil production (Foidl et al., 1996). Partnership with the oil plantations for various purposes in several countries, reliable industry may be needed to formulate and evaluate the scientific data on its agronomy are currently lacking. There required fuel standards, provide for storage and set up is considerable scope for the development of technology to distribution facilities. Jatropha production could offer a optimize production. As Jatropha is still a wild plant, careful new commercial activity for mineral oil firms that wish to selection and improvement of suitable germplasm is neces- diversify their portfolio to include biofuel processing and sary before mass-production can be realised. Comprehen- distribution, and blending fossil fuels with biofuels. sive research and experimentation is also needed to calculate input/output balances of plantations in different climate/ 4.3. Indicative economic analysis of the Jatropha system soil conditions in order to estimate long-term productivity in the Indian context under different conditions. Jatropha exhibits great variabil- ity in productivity between individual plants. Thus, annual A preliminary economic analysis of the production system seed production per plant can range from about 200 g to gives an insight into the potential for setting up Jatropha more than 2 kg. Decline in productivity has been reported curcas plantations on wastelands for large-scale bio-diesel as plantations age (Sharma et al., 1997). production. The estimates are based on the productivity of Agronomic conditions, such as optimum soil texture, plantations on degraded and currently unusable land with amounts of water, spacing, pruning intensity and micro- poor soils. Such land is without opportunity cost at present, as it cannot be used for other agricultural purposes. The estimates are presented in Tables 5–7. 3 It contains 5.7–6.5% N, 2.6–3.0% P2O5, 0.9–1.0% K2O, 0.6–0.7% CaO The report of the committee on development of biofuel and 1.3–1.4% MgO. (India, 2003a) of India’s Planning Commission envisages 4 Phorbol esters of Jatropha curcas decompose completely within six the setting up of large seed-processing units with a capacity days (Rug and Ruppel, 2000).

20 George Francis, Raphael Edinger and Klaus Becker / Natural Resources Forum 29 (2005) 12–24 Table 5. Indicative cost-benefit analysis of Jatropha plantations over a productive period of 30 yearsa Item Value Remarks Space occupied by each plant: 2.9 m × 2.9 m Total Jatropha plants per ha 1,200 Annual yield of dry seeds per plant (kg) 1.5 kg With minimal inputs from year five onwards Total annual yield per ha from year 5 on 1,800 kg 444 kg in year 1; 1,111 kg, yr 2; 1,333 kg, yr 3; and 1,556 kg in year 4 Price of dry seeds per kg (US$) US$0.11 Total selling price per ha per year (US$) US$198 Additional income from vegetable US$109 US$43 and US$65 during years 3 and 4 intercropping (US$) starting from year 5 Employment generation per ha 200 person days during the first year and 50 person days thereafter for 29 years Establishment cost per ha. (US$) US$435 during year 1 Maintenance per ha US$109 per year from year 2 for 29 years Share of unskilled labour costs (US$) US$261 during year 1 and US$65 during the subsequent 29 years Present value of life cycle costs/ha (US$) US$1,459 Present value of returns/ha (US$) US$2,313 Net present value (US$) US$853 Assuming an interest rate of 10% Internal rate of return (%) 21.8 Rate of return at which net present value is zero Note: a Assumed values are based on conditions of wasteland cultivation in India. Table 6. Cost benefit calculations (in US dollars) for a small-scale bio-diesel production planta Item Value Remarks Jatropha oil inputs per year (tons) 2,000 Production from about 4,000 ha. Capital cost 340,870 Input from equipment makers. 2,000 metric tons at US$407.8b per t. Purchase of raw material/year 815,528 Process cost per year 251,874 At US$126 per ton of Jatropha oil; input from industry sources and includes cost of methanol, catalyst, energy, personnel, maintenance and capital investment costs; a full capacity utilization is assumed; each ton of bio-diesel requires about 70 kWh electric power, about 15% by volume of alkaline methanol and 80 litres of water. Total recurring cost per year 1,067,402 Sum of previous two. 92% efficiency ((2000 × 1000/0.87) × 0.92) Output of bio-diesel (litres) 2,114,943 Cost per litre 0.50 Selling price per litre L 0.53 Total selling price 1,114,943 Present value of life cycle costs 11,470,579 For a period of 30 years. Present value of returns 11,625,410 For a period of 30 years. Net present value 154,831 Assuming an interest rate of 10%. Internal rate of return (%) 16 Rate of return at which net present value is zero. Notes: a Calculated for an annual processing capacity of 2,000 tons of raw vegetable oil. b At an actual extraction of 28% oil from Jatropha seeds, 3,571 kg of seeds would yield 1 ton of oil. At a cost of US$0.11 per kg of seed and a processing cost of US$19.6 per ton of oil, the cost per ton of oil to the bio-diesel refineries would be US$407.8. of 7,500 tons of seeds per year, and centralized refineries Table 7. Final selling price of bio-diesel after factoring in returns from selling by-products with a capacity of about 100,000 tons of Jatropha oil per year. While the large capacity may offer obvious eco- Item Value Remarks nomies of scale, we feel that a decentralized model would be more beneficial in the long run. Decentralization would Factory cost of one litre 0.53 From Table 6 also include other benefits, such as creating local employ- of bio-diesel (US$) By-product glycerol (US$) 0.08 (0.095 l per l of bio-diesel, ment opportunities; making fuel supply widely available US$0.08 per l) throughout the region; and facilitating easier local redistri- By-product seed cake (US$) 0.05 (2.1 kg per litre of bio-diesel bution of by-products, particularly the seed cake. The model at US$0.05 per kg) presented here therefore differs from that given in the afore- Net cost per litre of 0.40 (0.53–0.08–0.05) mentioned report. bio-diesel (US$) The price of US$0.53 for one litre Jatropha bio-diesel given in Table 6 may be compared to the current price in

George Francis, Raphael Edinger and Klaus Becker / Natural Resources Forum 29 (2005) 12–24 21 Table 8. Some economic benefits of bio-diesel production from Jatropha seeds grown on wastelands in Indiaa Year 2010 2020 2030 Wasteland to be cultivated (million ha) 0.4 2 10 Production of bio-diesel (million tons/year)b 0.20 1.01 5.07 Foreign exchange saving by fuel substitution (million US$/year)c 67 334 1,672 Employment generation (man-days)d 200,000 1,000,000 5,000,000 Savings of CO2 consumption by the use of the produced bio-diesel 0.5 2.7 13.4 as automobile fuel (million tons/year)e CO2 sequestration in the biomass (million tons/year)f 0.9 4.6 22.9 Possible income from CO2 reduction from emission trading (M US$)g 14.5 72.5 362.5 Notes: a Assuming current production patterns do not change. b Assuming production of 583 l per ha per year. c Assuming an average international price of US$45/barrel of crude oil. d Assuming average employment of one person for two ha. e Assuming that the end use of bio-diesel reduces life cycle CO2 emissions by 85% compared to use of petro-diesel and a production of 2.7 kg of CO2 per litre of diesel and a density of 0.87 for diesel. f Except seeds taking an average of 2.5 metric ton of biomass increment per ha per year containing 25% C thus sequestering 3.66 metric tons of CO2 per metric ton of C. g Calculating an average market value of US$10 per ton of CO2 in international carbon markets. Germany for one litre bio-diesel from rapeseed of a0.55 at present an indicative cost-benefit analysis of such large- the company gate. It should be noted that rapeseed cultiva- scale Jatropha bio-diesel production. tion is substantially subsidized in Germany. The estimated The multifaceted benefit potential of producing Jatropha price of Jatropha bio-diesel of US$0.53 may appear a bit bio-diesel from plantations on wastelands is obvious from high, but this price should be weighed against the infertility Table 8. The increase in price and quality of the reclaimed of the lands and the absence of any kind of subsidies for land, reduction of air pollution resulting from use of bio- the farmers. The profits from selling by-products, i.e., glyc- diesel, and other related socio-economic benefits to the local erine for industrial uses and seed cake as manure or animal economy are not factored into these calculations. Of great feed, can bring in additional profits for the producers and significance is the fact that Jatropha bio-diesel production would thus decrease the selling price of bio-diesel to an actually generates employment for largely unskilled labour- estimated US$0.40/l (see Table 7). ers and cash income in remote rural areas. It is emphasized The challenges for research and technology develop- again that the land foreseen for this purpose is currently ment for improving the profitability and the acceptability not in use. Thus planting these areas to Jatropha would not of the system should not be underestimated at this stage. take away any land from producing food crops. It has also The net price of US$0.40/l for Jatropha diesel is still higher been noted that Jatropha, despite having several toxins in than the basic price excluding tax for petro-diesel in its seeds and leaves, does not cause accumulation of toxins India (about US$0.35). For market introduction of Jatropha in the soil or inhibit grass growth underneath its canopy. bio-diesel, tax exemption would be necessary and would In addition, Jatropha plantations have been observed to be result in loss of revenue for the Government of India if frequented by animals and birds; they can therefore increase the product is marketed on a large scale. Taxes on the habitat value of barren lands. petroleum products, especially diesel, form an important income to India’s central Exchequer. For the financial 4.4. Financial requirements for setting up large-scale year 2002–2003, total sales of gasoline in India was US$5.9 plantations in India billion, which included US$3.4 billion in taxes for the Government; diesel sales totalled US$17.9 billion, out of The Government of India has invested considerable funds which the Government received US$5.9 billion in taxes in various afforestation programmes and is in the process (India, 2004). of initiating a comprehensive programme for the greening India is likely to require about 5–6 million tons of bio- of India for livelihood security and sustainable develop- diesel in 2030, if 5% of the diesel used in transport is to be ment, covering 43 million ha (being the regeneration of replaced. This amount of bio-diesel can be generated from 15 million ha of degraded forests, and agroforestry on 10 million ha of Jatropha plantations at current trans- 10 million ha of irrigated and 18 million ha rainfed esterification efficiencies, provided the production volumes lands) over 10 years envisaging an annual investment per ha assumed in Table 5 are achieved. In Table 8, we of about US$1 billion (India, 2001b). A Central Planning

22 George Francis, Raphael Edinger and Klaus Becker / Natural Resources Forum 29 (2005) 12–24 Commission task force for assessing this initiative stated in Although every effort has been made in this research its report that circumstances warrant legal, policy and socio- to be realistic in calculating production and related costs, economic support to render maximum benefits to forest experience in several previous projects indicates that primary dwellers and farmers besides curtailing the import of forest data over a longer period of time from pilot ventures are products of Rs 8000 crore (about US$1.75 billion) annu- necessary to verify the model. A pilot study to evaluate the ally. For comparison, the investment required to establish above parameters is currently underway in India in coopera- 10 million ha of Jatropha plantations is about US$5,435 tion with the Council of Scientific and Industrial Research million versus the central Government’s planned invest- (CSIR)/Central Salt and Marine Chemicals Research Insti- ment of about US$9,397 million in afforestation over the tute (CSMCRI), a major government research organization, next 27 years (India, 2001b) even if the investments remain and a multinational company, DaimlerChrysler, Germany. unchanged at current levels. An energy input/output analysis on the plantations set up Producing biofuel from eroded soils promises to achieve on wastelands in different climatic regions of India under both wasteland reclamation and fuel security goals and is this project is expected to provide concrete data to enable a therefore in line with the Government of India’s policy of comprehensive energy budgeting of the activity. national development. The investment required for setting up nurseries, seed collection centres, processing infrastruc- 5. Outlook ture, and transesterification units could by and large come from the private, cooperative and corporate sectors, once legislative framework mandating the use of bio-diesel has While Jatropha is seen as a very promising option for been put in place and the ecological and economic viability producing biofuel from degraded areas, generating rural of the concept have been demonstrated. The indicative eco- employment, increasing environmental quality and provid- nomic analysis provided above shows the economic potential ing primary energy carriers to energy deficient areas, the of the Jatropha system. Furthermore, the possibilities offered adoption and implementation of the concept have advanced by the clean development mechanism (CDM) of the Kyoto comparatively slowly so far. Barriers include: Protocol could be utilized to elicit international funding and further enhance the project’s cost-effectiveness. • Insufficient information on its suitability for specific areas; • Lack of species improvement through organized selec- 4.5. Measures for sustainable Jatropha production tion and breeding programmes; and In summary, the following research and development efforts • Limited agronomic studies on input responsiveness and seem crucial to creating a sustainable and viable production productivity under various climatic conditions, pathology, of Jatropha bio-diesel on eroded lands: and economic studies on market potential, acceptability and applicability of Jatropha products. • Selective breeding to improve the existing germplasm of Jatropha curcas, and increase seed yield. A manifold The suitability of promoting Jatropha cultivation on a increase in productivity has been achieved in many cultiv- commercial basis on fertile land replacing other food and ated plant species in the past. Currently cultivated varieties cash crops in the tropics has been questioned. Also, a com- of Jatropha are based on natural wild planting material, prehensive economic evaluation of such an activity is not and it is estimated that appropriate selective breeding available in the literature. Less controversial and more could improve yields by 15–25%, to about 2,250 kg seeds desirable would be the cultivation of Jatropha curcas on per ha in the short term. degraded lands that currently cannot be used for agricul- • Optimizing low-cost oil expulsion technology to reach a ture, as well as utilizing Jatropha species that are available 93–95% level of efficiency. as native plants in respective countries. Jatropha thrives • Maximization of the transesterification efficiency and on unproductive lands with limited water supply and poor minimization of costs. Improvements in the catalytic soil and could yield oil seed already during the first year process are possible; this would recover and reuse the of cultivation, albeit on a small scale. expensive catalyst. However, to be sustainable in the long term, any agricul- • Design of low-cost, robust and versatile small-scale oil tural activity requires the acceptance of local farming expulsion and transesterification units. communities. The ability to generate income in the short • Raising the nutritional quality of the seed cake by- term without insurmountable upfront capital investment and product to animal-feed grade, which would increase subsequent expenditure (e.g., on fertilizer and pesticide) is its price. In the above scenario, yield would be about a prerequisite in the case of the targeted farmers, who are 500 kg/ ha; the price of feed-grade seed cake would be often extremely poor. Jatropha may be considered suitable about Rs 8–10 (about US$0.2) per kg. Achieving such under these conditions as the plant is often known to farm- production and sales would have dramatic consequences ers, and small to midsize oil production technologies are for the profitability of the Jatropha system. available on the market.

George Francis, Raphael Edinger and Klaus Becker / Natural Resources Forum 29 (2005) 12–24 23 References There have been several previous initiatives to spread Jatropha cultivation in Africa, Asia and South America

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