A causal descriptive approach to modelling the GHG emissions associated with the indirect land use impacts of biofuels

This report summarises the outcome of a study commissioned by the UK Department for Transport (DfT). The study aims to develop an understanding of the chain of causes and effects that lead from an increased demand for biofuel feedstock to indirect land use change (ILUC), and provides a framework for capturing and quantifying those relationships. It specifically studies the greenhouse gas (GHG) impacts associated with the land use changes identified. Although there are clearly other important environmental and social impacts associated with land use change, these impacts were outside the scope of this study. The study is based on a causal-descriptive methodology which uses cause and effect logic to describe and derive the ILUC impacts, and makes wide use of stakeholder input. It provides an alternative modelling approach to the equilibrium models that have been increasingly used for ILUC factor calculations for biofuels, and could potentially be used to inform those models.

The causal-descriptive methodology used required mapping of all the impacts a biofuel has on the broader agricultural and land use systems, in order to identify all the possible land use changes that a biofuel can cause. The indirect land-related impacts of the biofuel (in terms of additional GHG emissions) were then established by estimating the quantity and type of land use change which occurs as a result of different market responses resulting from biofuel demand. The cause and effect relationships were estimated using a combination of extrapolation of historical trends, input and validation on future markets by an expert advisory group, and stakeholder feedback. This has provided a more transparent and participative approach compared to the equilibrium modelling approaches used to date, whose underlying data and assumptions are more difficult to access and thus limit the potential for stakeholder participation.

The methodology used does not explicitly model prices and as such differs from equilibrium models. Price modelling is inherently uncertain and would have added significant additional complexity beyond the scope of this project. However, prices have been implicitly considered by using supply projections based on historical trends and expert opinion to understand deviation from historic trends, as this was considered the best proxy for what might happen in the future.

This study estimates the ILUC impacts of five different biofuel feedstocks: palm oil, rapeseed oil, soybean oil, wheat and sugarcane. The scope was limited to these five feedstocks as they were considered by DfT to be the most relevant to the UK, in view of the fact that these are the main feedstocks used for biofuels consumed in the UK. US corn ethanol was therefore not covered in this study.