A strategy for biofuel use in Singapore might include:
Tax breaks to encourage transition. Diversifying the domestic energy profile involves managing what economists call externalities. If biofuel-friendly vehicles cost more and are less convenient to use, then the average driver would not want to purchase one, whatever the broader benefits to the environment or economy. There have been tax breaks for ‘green’ cars in the past. If not already the case, these tax breaks should be extended to biofuel vehicles. In addition, government vehicles such as a proportion of police, ambulance and military vehicles should be biofuel-compatible hybrids.This will act as additional insurance in the event of a fuel crisis.
Cultivating agricultural nations and biofuel exporters. If biofuel becomes prominent in the world energy market, nations rich in agriculture will gain an increase in influence. While continuing our links with The Middle East, we should also maintain good relations with these biofuel producers. We can build a second level of protection against dependency, by obtaining biofuel from multiple sources, spread across more than one geographical region. The two largest producers of biofuel today are Brazil and The United States , both having domestic agriculture as a source of raw material. Closer to home, Thailand is a world - class exporter of sugar (used in ethanol production), and Malaysia is a major producer of palm oil (used to produce biodiesel).
Research. Biofuels are biotechnology-intensive in their production. Enzymes are required to prepare the raw material biomass, followed by fermentation and processing. Some of Singapore’s R & D investment should go towards biofuel research.
Biofuel-hub. Singapore can start a biofuel-hub, specializing in efficient conversion of raw material to fuel. This would dovetail nicely with an ongoing research programme, and generate more employment for life science graduates. Raw palm oil could be obtained from Malaysia or Indonesia to make biodiesel. Ethanol could be produced using sugar from Thailand. There would undoubtedly be competition, as other regional players try to join the bandwagon (Malaysia has mentioned becoming a biodiesel hub), but this is not very different from setting up an oil hub, which Singapore has successfully done.
