SUAREZ:  Cynthia Rosenzweig, a lot of the talk inside development circles in the post colonial era was about food crops versus cash crops, whether it makes more sense for a country to produce cashews for Western European and North American dinner tables or food for their own people to eat.  Is the future conversation going to be about biofuels versus food fuels in those places where there is food insecurity.

ROSENZWEIG:  It will certainly enter into the conversation and it already is, but I wanted to bring up that the changing climate is going to have an effect on biofuel production both in tropical areas and in temperate areas, so a lot of the estimates that have been made have not taken a change in climate into account, and we need to do that to get realistic numbers. 

SUAREZ:   Professor Schneider, one of the most difficult parts about having this conversation is the way we count what works or the way we count impacts –  the things we are trying to do. So biofuel, depending on who you read and who’s making the argument, is either just scratching the surface or a tremendously promising way of moving forward that has a lot of efficiencies built right into it.  Help us understand what you have to keep in mind when trying to assess whether something is worth investing in and worth heading down that road.

SCHNEIDER:   Right, remember that Suzanne said that biofuels were a piece of many things, efficiency, getting every single thing we do, the windows in our house, the light bulbs, the refrigerators, the air conditioners, to have the maximum amount of benefit to us.  To give us the service we want at the least amount of energy is important because you then take the stress off the system upstream.  So that’s the first thing to do and it’s the easiest because you get very fast paybacks.  You actually spend less money in terms of the extra increment if you buy a refrigerator for $1,000 and then there’s another one for $950 but you’re saving $20 a year on electricity by buying the more expensive one, you’re paid back way faster than you can earn that money anywhere else.  It’s just foolish not to do it.  But people have to know that and not be afraid of sticker shock as we call it. 

So the first complexity is to learn how to be a good consumer and some rules for performance standards help.  What about when you’re talking about how do you get this development?  If you want to get a biofuels industry going or the coal industry which says we’re the only ones that can supply energy that we need to be able to have China and India catch up with us, and everybody says oh wait a minute that’s going to triple and quadruple CO2 that’s a dangerous planetary threat and they say no, we’re going to take the CO2 out of the power plant, we’re going to put it underground, that’s called carbon capture and sequestration.  The trouble is, how much is that going to cost?  How safe is that going to be?  We’ve got to try it, but it’s only one of a number of solutions like biofuels so then we also have to say what about windows, what about solar thermal, not the rooftop collectors, you need those too, and some even say what about nuclear. 

Every single one of these has opportunities and problems.  The trouble is the devil is deeply in the details.  And the costs, the social acceptability, we don’t know that yet on all of these issues, so the worst thing we could do is make a choice; the best thing we could do is let 100 flowers bloom.  Let’s try a lot.  The big problem is, how do you get the incentives to get this experiment going?  In order to build a plant to demonstrate whether you can do it cheaply and socially acceptably and safely, you’ve got to invest money.  People say billions it’s going to take to do this.  Well, most investors want to get a return but there is speculation here, so how do you get over the investment hump?  In order to get a return on investment, you have to have an investment, so that’s where we need public-private partnerships where the government has to come in with either incentive programs or technology assistance or with other kinds of ways to get that capital flowing so that we can let our own economy and technology work to produce these alternatives, have this big competition to see who’s going to win, what combination is going to look safe and effective.  But that doesn’t happen just by itself.  So the real problem comes along:  how do you get the incentives in place and in the U.S. we can manage that more easily,  We are a wealthy economy; it’s a very small fraction of the growth rate in our economy to fix this problem, but that’s not true in developing countries so we have to be partners with them to assist them over the hump toward their development. 

And when you were talking with Cynthia Rosenzweig a minute ago about some of these developments and the problems and the trade offs about biofuels vs. food, remember when the Green Revolution came along that there were these special seeds that gave you much higher yields 20-30 years ago.   It was a wonderful boon in terms of food, but it also caused unemployment out in the community because you had fewer folks growing with higher production and it created migration to cities.  Well, the same thing can happen.  How are we going to deal with that?  So this is a very complex world and we have to look at multiple elements.  It’s a jigsaw puzzle and the trouble is we lock ourselves in universities and departments of biology and chemistry and agronomy and unfortunately governments do the same thing.  We have the Department of Agriculture and Energy, we need people who integrate because this problem is a systems problem and that’s the real challenge of the future:  coordinating our incentives.

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