Britain accelerates toward cleaner future - with wheat

Wheat never used to get Charlie Goldsack excited. He's got fields of the stuff down on his farm, but as a cash crop there was one big problem: it didn't generate much cash. Rock bottom prices saw to that.

But now, the farmer hopes his wheat might literally become the driving force of his 1,400-acre Friar Maine farm in southern England.

Instead of heading to the bakery, Goldsack's harvest will now go to a nearby plant for conversion into bioethanol - part of accelerating British efforts to introduce cleaner car fuel.

"For a lot of farms, it was barely economic to grow wheat any more," he says. "This is just what we need - a new market. Hopefully it can soak up all the surplus and raise prices."

The simple arithmetic looks compelling. Goldsack's roughly 250 acres could yield enough wheat to produce a million miles' of car fuel.

Extrapolate that across all of Britain's farmland and you get enough bioethanol to account for 5 percent of all fuel used annually by British motorists - a target the government wants hit by 2010. In a pleasing symmetry, the amount of wheat required would be around 3 million tons, roughly equal to the excess produced each year that is unwanted by the domestic market.

"If this soaks up that surplus then it could add eight or nine pounds to the [per ton] price of wheat," enthuses Goldsack, estimating that this would be worth about £10,000 ($17,445) a year to his investment-starved farm.

While President Bush last week emphasized the need for cleaner cars for reasons of energy security, Britain's motivations are slightly different. As a signatory to the Kyoto pact on climate change, Britain must reduce carbon emissions by 20 percent by 2010.With motoring accounting for almost one-third of emissions, and greener fuels like bioethanol estimated to reduce greenhouse gas output by around two-thirds, the logic appears indisputable.

But there is a snag. Experts warn that biofuels are very expensive to produce - roughly twice as costly as gasoline - and can only become viable with generous government subsidies.

They also note that it will be difficult to create a network of "gas" stations selling bioethanol, since many of Britain's current gas stations are owned by petrochemical giants that have little interest in supplying a product that challenges their own hegemony. Britain's biggest energy producer, BP, says it is "looking at" introducing bioethanol, but none of its 1,300 gas stations throughout the United Kingdom sell the product yet.

"One man and his chip pan [deep-fat fryer used to make french fries] may be able to turn fat [from cereal grains] into petrol, but he's a long way from being able to take on BP," says Nick Matthews, principal fellow at the Warwick Manufacturing Group, a research body in central England.

"I can make black pop and sell it in bottles," he continues, "but can I take on Coca-Cola? They have such massive branding and distribution that no one's going to buy my stuff.

"Oil companies want to get the benefit of vertical integration in their system; therefore, unless there is the regulatory and fiscal framework to stimulate it, it won't happen of its own accord," Mr. Matthews adds. Still, some bioethanol is already creeping into usage here, not as a separate fuel with a pump of its own, but as a blend that is mixed with petrol in a ratio of about 1 in 20, for use in ordinary cars. Any richer mix than that and cars must undergo a relatively inexpensive adaptation to replace rubber and aluminum parts, which would be eroded by bioethanol.

Ford and Saab have produced "flex fuel" cars that can run on either bioethanol or normal petrol, or any combination of the two. A pilot project in southwest England is introducing cars running on E85 (a fuel made of 85 percent bioethanol) within the local police force. Gas stations at supermarkets in the region are preparing to install E85 pumps to supply the new fleet. The US, generally acknowledged to be a step ahead of Britain on biofuel, has an estimated 600 stations that offer E85.

A recent government ruling could force oil companies to equip their gas stations similarly. Just as it did with electricity generation, the government has said it will order energy groups such as BP to ensure that a certain proportion of their products are made from renewable resources. It has yet to give an exact figure, but industry insiders predict it will be around 3 percent.

The Renewable Transport Fuel Obligation will come into operation in 2008. For Malcolm Shepherd, managing director of a company created last year to make bioethanol from farm produce, this could make all the difference.

"If they [oil companies] fail to fulfill the quota, they will have to pay penalties," he notes. "The obligation will open up forecourts [gas stations] to the biofuel industry."

Mr. Shepherd's company, Green Spirit, is building one of Britain's first major bioethanol factories - where crops are turned into fuel - in southern England. It estimates that as many as 10 others will be required nationwide to satisfy British demand alone.

Matthews notes that the US and Brazil are world leaders in biofuel usage because of the formidable acreage at their disposal. "Here it's completely uneconomic," he says. "Oil prices would have to be astronomically high to make it worthwhile."

Professor Stephen Glaister, a transport expert at Imperial College London, takes an even broader view. "It's all about the arithmetic," he says. "Energy comes from the sun. It's just a question of whether there's enough sunlight and enough land to capture it to produce sufficient volumes of energy."