Can someone please explain to me why biofuels need to be commercially viable in their own right?
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The answer may seem simple and obvious in the context of capitalism, but as you consider your response try to avoid presenting an argument that fossil fuel subsidies and other government help around the world like tax breaks for the energy extraction industries, tax breaks for some end users, undercharged royalties for that resource extraction, public infrastructure dedicated to moving fossil fuels around, financial handouts to keep some local infrastructure open, and just plain lowering the price at the pump by paying for part of it, should also be ended immediately.
Not so easy now, huh? Unless of course you are in favour of ending them, because that would make the various renewable options far more viable.
The International Energy Agency (IEA) certainly feels that way. As stated on their website, "The IEA has long advocated removing or at least reducing fossil fuel subsidies because they distort markets, send the wrong price signals to users, widen fiscal deficits in developing economies, and discourage the adoption of cleaner renewable energies. Their expansion is particularly worrying at a time when we should be redoubling efforts to cut wasteful consumption and accelerate clean energy transitions."
The IEA also says that crude oil remains the world's most subsidised fuel source, despite also remaining ridiculously profitable.
As I've explained in previous columns, converting existing internal combustion engines to biofuel is really not that difficult, or costly, or resource-hungry. It's certainly nowhere near as demanding on those things as scrapping vehicles to make completely new ones (especially if they require a pile of rare earths that still need to be dug up).
Australia also props up the fossil fuel industry to such a degree that it must surely be impossible for our diplomats to be taken seriously when advocating for other nations to use more renewables.
Federal Greens MP Adam Bandt has been pushing hard to stop public money going into any new gas and coal projects, further arguing that many of these companies haven't been paying tax for a long time either.
Meanwhile, non-road users can apply for fuel tax credits. As listed on business.gov.au, these "provide businesses who have purchased fuel for their business with a credit for the tax that is included in the price of fuel." And from an accounting perspective that seems kinda fair, because otherwise the eligible small businesses (including farms) would be paying a form of road tax for roads they aren't using the fuel on. However, it also means that any tax breaks on biofuels are ineffective on these users since they wouldn't have been taxed on that fuel anyway.
I'm not advocating that these tax breaks be removed. Too many farms (and other small operators) would fail. I am however, saying that the domestic biofuel sector seems to need more than the smoke and mirrors of fake help they've had offered to them so far.
Then there's the free money handed to our last two remaining crude oil refineries so that we have at least some production capacity onshore. Estimates put it at 10 per cent of our consumption coming from them currently, and they'd be maxed out producing just 25 per cent of our current demand.
Further to that point though, and not counted by the IEA or anyone else, is the colossal military spending to keep shipping lanes open. If the tankers were to stop turning up (mostly from Singapore, but other parts of the world as well), rationing wouldn't even come close to solving our energy needs.
This strategic dependency on constant supply has been the case for decades in all developed countries. As an example, British prime minister at the time Anthony Eden acknowledged in one of his public addresses in 1956 at the start of the Suez Crisis that the canal was the main passageway for "about half the oil, without which the industry of this country (UK), of Western Europe, of Scandinavia, and of many other countries too, couldn't keep going." And it was the public (not industry, or the oil sector) who paid the price of the military action, both financially and with their lives.