Today, mankind is facing three of the most massively dangerous problems since its birth:

1 – The increase of the greenhouse effect which definitely puts the biodiversity in peril because of the high speed of climate change,

2 – The exhaustion of petroleum whereas the world's economy is totally built on it,

3 – The increasingly unbearable imbalance between rich and poor countries which, beyond the unacceptable human aspects, causes greater geopolitical tensions worldwide.

People have been taking stock of a threat most readily characterized by its global impact. It covers the entire planet and menaces all species by an alteration, already underway, of their habitats and by a global and too quick modification of the earth’s climate.

This is the greenhouse effect.

The cause is of biblical simplicity. Mainly since the industrial revolution of 1850, mankind has spewed into the atmosphere in the form of carbon dioxide (CO₂) in immeasurable quantities the carbon that plants had been using for 300 million years, to create what we call “fossil fuels” – coal, natural gas, and petroleum. Yet carbon dioxide is one of the most pervasive greenhouse gases and there is no "clean" fossil fuel. No matter what you do, if you feed an engine with fuel containing fossil carbon, you will have the same quantity of fossil carbon at the exhaust.

Some numbers just to illustrate: 6 billion tons of CO₂ emissions of human origin in 1950, 22 billion tons in 1989, and 24 billion tons in 2000 (source: US Department of Energy [1]).

With, among other factors, the 8% increase (and higher) in the economic growth of China and India, not to mention the USA, Central Europe, Brazil, Turkey, etc. the phenomenon is not about to reverse itself, considering more or less that one percentage point of economic growth entails an increase by one percentage point of energy consumption and linked CO₂ emission.

A solution to greenhouse effect the Clean Development Mechanism (CDM) has been introduced. CDM is one of the Kyoto mechanisms; the CDM aims to promote sustainable development in developing countries as well as to help Annex I Parties achieve compliance with their Carbon Emission Reduction (CER). It allows Annex I countries (mostly industrialized countries) to invest in emission-saving projects in developing countries and gain credit for the savings achieved through the generation of Carbon Emission Credits that they can use to contribute to compliance with part of their emission reduction targets. The CERs will be added to Annex I Parties' assigned amounts. The Carbon dioxide released into the atmosphere when biofuel is burned is recycled by growing plants, which are later processed into fuel. Thus, the CO2 emission of Jatropha oil can be assumed almost zero. For this reason, a project which aims to exploit the potential of Jatropha Curcas as energy crop owns all requisites to be eligible within the CDM

There are new and high potential opportunities to generate carbon finance in the biodiesel sector.  The use of petro-diesel in engines creates a significant amount of greenhouse gas emissions that can be greatly reduced by substituting a blend of biodiesel and petro-diesel or using 100 percent biodiesel. Greenhouse gas emissions can be reduced in a number of ways through the biodiesel production process including:

• Carbon sequestration in the plantations of trees whose seeds are used for biodiesel production
• Substitution of biodiesel for petro-diesel
• Use of processed seed cake as an organic fertilizer.

 Biodiesel can be produced from plants such as rapeseed, palm, coconut, or soybean or Jatropha curcas or from used cooking oil from restaurants. Regarding Clean Development Mechanism projects, there is a great potential in the use of Jatropha curcas. 

The study concluded that biodiesel yields 3.2 units of fuel product energy for every unit of fossil fuel consumed while petroleum diesel yields 0.83 units. Additionally, the study concluded that, over a lifecycle, that biodiesel reduces net CO₂ emissions by 78%. In relation to carbon credits, it has been estimated that 1 hectare of Jatropha curcas could result in CO₂ emissions reductions of 10 tonnes per year (Francis and Becker 2001).  There is a large potential for CDM biodiesel projects in many countries.

Including revenue from carbon credits from petro-diesel substitution and possibly carbon sequestration and nitrogen based fertilizer substitution; biodiesel projects become considerably financially attractive.  See Table below for CER estimations for a 100 hectare (ha) Jatropha curcas plantation.  Note: trees per ha can vary greatly and the price of CERs ranges according to the risk taken by the developer regarding guarantee of delivery of CERs.

Possible CER revenue for a 100 hectare plantation for biodiesel

Variable	AMOUNT
Total area(ha)	100
Trees(per/ha)	2500
Total Trees	250000
Biodiesel Production  (Litres/year)	338800
CERs from Biodiesel (Tonnes CO2 e/year)	940
Risk related CER price  range($)	5-25
Tota CER revenue($/yr)	4700-23500

With the above estimation and an estimated retail diesel price of $0.47/litre, CERs for a litre of biodiesel can add value by $0.01 to $0.07/litre or 2 to 15%.

Biodiesel production is a growing industry throughout the world.  Interest in the use of the seeds of Jatropha curcas, as well as other plants, to make the oil is rapidly expanding.  CDM potential is present in a large number of countries due to the number of types of plants from which biodiesel can be made. The time for realizing the potential of biodiesel in the carbon market has arrived.

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