An economic assessment of the potential and costs of investments in R&D in agriculture to avoid land use change and food security effects of bioenergy

Abstract

There are major concerns about the impact of the large scale production of woody and grassy crops for energy production on the conversion of natural vegetation and on food security. The objective of this study is to evaluate the possibilities and limitations of avoiding these undesirable effects by increasing the productivity of crop and livestock production through investments in R&D in agriculture. An extended version of the Modular Applied GeNeral Equilibrium Tool (MAGNET) is used to model the R&D investments in agriculture to compensate the effects of 15 EJ to 100 EJ biomass supply from energy crop plantations. The costs of R&D investments in agriculture to avoid the expansion of land are estimated at 6 to 64 billion US$ for 15 to 100 EJ, respectively. Food security effects are less costly to compensate, i.e. food security improves when the land use change effects are compensated. The costs of R&D investments correspond to 0.4 to 0.6 $/GJ biomass from plantations. The costs of R&D investments are higher in industrialized countries compared to developing regions, because of the longer time lags between R&D investments and productivity increases in industrialized regions. The impact of R&D investments in agriculture to avoid land use change in 2030 results in positive effects in 2040 and 2050, i.e. agricultural land use decreases and food security improves compared to no bioenergy plantation scenario, because of the time lag of R&D investments. We conclude that investments in agriculture R&D are a potentially effective and low-cost strategy to avoid undesirable land use change effects of large scale use of biomass from energy crop plantations, but the time lag effect requires early planning and alignment in time of bioenergy policies with investments in R&D in agriculture.