Biofuel Support Policies: An Economic Assessment
Governments in many OECD countries, as well as in a number of countries outside the OECD area, actively promote the production and use of alternative transport fuels made from agricultural commodities. This report, jointly produced by the OECD and the IEA and drawing on information from a number of other organisations, analyses the implications of this support from various perspectives. The report shows that the high level of policy support contributes little to reduced greenhouse-gas emissions and other policy objectives, while it adds to a range of factors that raise international prices for food commodities. It concludes that there are alternatives to current support policies for biofuels that would more effectively allow governments to achieve their objectives.
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Costs and Benefits of Biofuel Support Policies
The preceding chapter presented and discussed the results of model-based analyses. Existing and new biofuel support policies were in the centre of the set of scenarios that were calculated using a large-scale economic modelling system Aglink-Cosimo, complemented by a stylised model on environmental implications of the policy changes, SAPIM. As for the results of any modelling system, those discussed above are subject to a certain degree of uncertainty, related to parameters and structures in the represented markets.
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