Biofuels Situation in South Africa – Input to ICID TF Position Paper on Biofuels

South Africa is a water stressed country that is generally characterized by low rainfall and high evapotranspiration. The average annual rainfall is considerably below the world average and ranges from less than 200 mm p.a. in some areas in the West of the country to greater than 800 mm p.a. in the East. The country generally has limited crop production potential with only about 16% (17 million ha) of land being arable. Although primary agriculture only contributes 2-3% to South Africa’s GDP and 8.5% to formal employment, agriculture has a significant indirect role in the country’s economy through forward and backward linkages. Biofuel production as an agricultural crop and which the strategy argues can have significant job creation benefits e.g. Department of Trade and Industry’s Industrial Policy Action Plan suggests 125 000 direct jobs could be created should a 10% blending target be set. The rural landscape is typified by high levels of poverty with approximately 70% of the country’s poor residing in these areas and a significant proportion of the total population experiencing food insecurity. Hence, as with other developing countries, food security at the household, community, regional and national level is of paramount importance. The global debate on the potential negative impact of biofuels on food security informed the development of the Biofuels Industrial Strategy of South Africa in 2007. The goal of the 5 year strategy is a 2% biofuel penetration (400 million litres p.a. by 2013). The strategy identified sugarcane and sugar beet for bio-ethanol production and soya beans, sunflower and canola (rapeseed) for biodiesel production. Recent studies indicate that grain sorghum, especially the faster growing sweet sorghum variety with a shorter growing season, is an alternative that can be used in combination with sugar beet, which can only be grown in winter due to our hot summers. The primary focus of the strategy is rural development and opportunities for the poor as well as job creation, therefore under-utilized land in specific production (former homeland) areas have been targeted. Although the strategy does not exclude irrigated crops, it does recognize that the country’s water resources will be severely impacted if there is widespread irrigation. It also acknowledges that irrigated cropping for biofuels will have to compete with other uses for the scarce resource. However, since the development of the biofuels strategy, the Department of Water Affairs has effectively issued a moratorium on irrigated crops for biofuel production. A recently completed Water Research Commission study on the water use of crops/trees for biofuels in South Africa mapped potential growing areas for crops identified in the Biofuels Industrial Strategy (BIS). The optimal growing areas for these crops, under dry land conditions, are mainly in the eastern and northern regions of the country. The study investigated the potential impact of producing these crops on water resources. With the exception of sugarcane, the study found that production of rain fed biofuel crops is unlikely to negatively impact on water resources. A second ongoing study seeks to strengthen assumptions made in this desktop study through field trials, where the water use and productivity of crops with good biofuel feedstock potential are monitored and more detailed modeling will be undertaken. To date, the project has highlighted the risks associated with production of some of the crops named in the BIS, in particular sugar beet, which trials have shown to be low yielding and disease prone in South Africa’s warm climate. Significant challenges face the emerging biofuel industry with regard to natural, social, human, physical and financial capital. Effective co-operative governance among the various role players will be essential in ensuring a successful industry. Although the current biofuels strategy only supports the use of first generation feedstock and proven commercial processes, it encourages research on alternative feedstock and the development of second and third generation technologies.