The International Energy Agency (IEA) predicts the world primary energy demand will grow by 1.6 percent per year on average between 2006 and 2030 - an increase of 45 percent, and China and India are expected to account for over half of incremental energy demand to 2030.

The Paris-based adviser to 28 oil-consuming nations says in the World Energy Outlook (WEO) 2008, the latest edition of the annual IEA flagship publication, that China's oil import would reach 75 percent of its annual oil consumption by 2030.

Despite the fact that the financial crisis squashed the world oil price to nearly US$55 a barrel last Tuesday, industry insiders still regard the prediction as a dangerous signal to the country's energy security.

Biofuel, one of the ways for the country to get rid of the IEA prediction, has again drawn attention.

Nobuo Tanaka, Executive Director of IEA tells China Business Weekly that the financial crisis is an appropriate time for China to develop clean energy.

Despite diving oil prices, "it is certain that while market imbalances will feed volatility, the era of cheap oil is over," Tanaka says.

"Low oil prices are a temporary phenomenon, and wouldn't impact very much on development of biomass," says Zheng Jilu, professor of Zhengzhou University.

China is abundant in biomass resources. According to statistics, in 2004, the country generated 600 million tons of straw, 1.3 billion tons of livestock and poultry waste, and more than 100 million tons of other agricultural wastes.

Most of this material can be used for biomass generation. In theory, it could produce energy roughly equal to 500 million tons of standard coal.

Chinese farmers generally recycle crop straw, grass, husk and animal dung and use it as biogas to produce fertilizer, which is organic and environmentally friendly for farming.

The country produced 750,000 tons of bio-ethanol in 2007, and it is scheduled to boost output to 5 million tons by 2010. Twenty-six million households in the country's rural areas were using methane for cooking and heating by the end of 2007, and another 5 million households will join the group this year.

China has used biogas pools in rural areas since the 1970s. The country is planning to expand utilization of biogas to 40 million households by 2010 and its annual production of biogas is expected to reach 15.5 billion cu m, equal to 11 million tons of standard coal. It is predicted that by 2020 about 70 percent of rural residents will use biogas as their daily energy source.

According to China's Mid- and Long-Term Development Program for Renewable Energy, by 2010, biomass power generation is expected to reach 5.5 GW. Liquid biofuel will be over 10 million tons and solid biofuel will exceed 50 million tons.

By then, China's biomass is expected to account for 4 percent of total consumption of primary energy.

During the period of 11th Five Year Plan (2006-2010), the country is focusing on development of non-grain biomass, especially encouraging cassava as a major material and at the same time developing sweet sorghum and cellulose.

It plans to form a material supply system component with cassava from southern China, sweet potato from middle and southwestern regions, corn and sweet sorghum from northeastern regions and sweet potato and sweet sorghum from northern and eastern regions.

There are also more than 5.4 million hectares of barren mountains and land in China and about 20 percent of them can be used to grow plants for energy generation. It is estimated to produce energy equivalent to 100 million tons of standard coal.

However, with the rapid development of biomass the world is facing insufficient resources. The National Development and Reform Commission (NDRC) halted the corn-to-ethanol program in 2007.

Chris de Lavigne, vice-president at NRG corporate advisor Frost and Sullivan, says the world's population is probably to exceed 10 billion by 2050, and the energy consumption will soar by 76 percent by 2030.

He says the material supply strain would be worse in the future.

"In order to continue supporting biomass, different countries take various measures. In the US, the government subsidies for biomass were US$10 billion. In Brazil, they can expand planting areas to ensure material supply. But for many countries, it is not very possible," he says.

Lavigne says: "I think it is the right decision not to allow grain to be involved in biomass production and to continue to seek alternatives."

In the mid- 1990s China became a net importer of oil and at the same time the over-production of grain led to an overstock. Biomass could be a good way to use a huge amount of surplus grain.

"Development of biomass not only helps meet energy demands, it is also significant to economies in rural areas," says Zhou Fengqi, former director of the Energy Research Institute under the NDRC.

"The government should take the lead," Zhou says, "China has introduced some favorable policies including tax preference and providing special funds, however, it is still not enough and the policy system should be further improved."

(China Daily?December 1, 2008)