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Fwd: BioFuels concerns in Wall Street Journal today



Apologies for Cross-Postings

[]   The Wall Street Journal [] []
December 5, 2006
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Crude Awakening
As Alternative Energy Heats Up,
Environmental Concerns Grow



Crop of Renewable 'Biofuels'
Could Have Drawbacks;
Fires Across Indonesia
Palm-Oil Boom Ignites Debate
By PATRICK BARTA and JANE SPENCER
December 5, 2006; Page A1

PONTIANAK, Indonesia -- Investors are pouring billions of dollars into "renewable" energy sources such as ethanol, biodiesel and solar power that promise to reduce the world's reliance on petroleum. But exploiting these alternatives may produce unintended environmental and economic consequences that offset the expected benefits.

Here on the island of Borneo, a thick haze often encloses this city of 500,000 people. The cause: forest fires that have blazed across the island. Many of them were set to clear land to produce palm oil -- a key ingredient in biodiesel, a clean-burning diesel fuel alternative.
[See a slideshow] 1
Patrick Barta
At a new oil-palm plantation, the hillsides have been cleared and terraced.

The bluish smoke is at times so dense that it leaves the city dark and gloomy even at midday. The haze has sometimes closed Pontianak's airport and prompted local volunteers to distribute face-masks on city streets. From July through mid-October, Indonesian health officials reported 28,762 smog-related cases of respiratory illness across the country.

"I feel it in my breath when I breathe," said Imanuel Patasik, a 26-year-old delivery man, as he sat in one of Pontianak's many open-air coffee shops on a recent evening. When the smoke is really bad, he wears a mask to work, but still wakes up the next morning feeling sick. "It's part of life here," he sighed.

Seasonal rains have helped quell the fires over the past few weeks. But the miasma of smoke from Borneo and the island of Sumatra -- an annual phenomenon that blankets large parts of Southeast Asia in smog -- underscores a troubling dark side of the world's alternative-energy boom. Among other problems, the fires in Indonesia spew millions of tons of carbon dioxide and other greenhouse gases into the atmosphere, experts say. In doing so, they exacerbate the very global-warming concerns biofuels are meant to alleviate.

Such side effects are not an isolated problem. In Indonesia, Malaysia, Canada and elsewhere, forests are being slashed for new energy-yielding crops or other unconventional fuels. In India, environmental activists say, water tables are dropping as farmers try to boost production of ethanol-yielding sugar.

"Let's be brutally frank: [The push for alternative fuels] is going to cause significant changes for the environment," says Sean Darby, an equities analyst and expert on alternative energy companies at Nomura International in Hong Kong. He is most worried about the strain on water resources caused by accelerated crop production. Water, he says, is "just as precious" as oil.

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Gary Liss       
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