Biofuels in the long-run global energy supply mix for transportation

Various policy instruments along with increasing oil prices have contributed to a sixfold increase in global biofuels production over the last decade (2000-2010). This rapid growth has proved controversial, however, and has raised concerns over potential conflicts with global food security and climate change mitigation. To address these concerns, policy support is now focused on advanced or second-generation biofuels instead of crop-based first-generation biofuels. This policy shift, together with the global financial crisis, has slowed the growth of biofuels production, which has remained stagnant since 2010. Based upon a review of the literature, this paper examines the potential long-run contribution of biofuels to the global energy mix, particularly for transportation. We find that the contribution of biofuels to global transportation fuel demand is likely to be limited to around 5% over the next 10-15 years. However, a number of studies suggest that biofuels could contribute up to a quarter of global transportation fuel demand by 2050, provided technological breakthroughs reduce the costs of sustainably produced advanced biofuels to a level where they can compete with petroleum fuels.