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Q&A: Addax
Bioenergy sugarcane ethanol project in Addax Bioenergy, a subsidiary of the diversified investment
group, AOG, is developing a
The Addax Bioenergy project
is supported by the Government of Sierra Leone,
by the Chiefdom Councils and by the land landowners in the three chiefdoms
who have welcomed Addax Bioenergy to develop its
project in their area. The project is supported by European Development
Finance Institutions and the African Development
Bank and this is one of the reasons why the World Bank’s
International Finance Corporation (IFC)
Performance standards and Equator
Principles are applied. In order to meet EU law on sustainability criteria, the industrial and
agricultural operating procedures adopt international best practices from the
sugar industry and principles and recommendations from the Roundtable on Sustainable Biofuels
(RSB) and the Better Sugarcane Initiative
(BSI) of which Addax Bioenergy is a member. Addax Bioenergy is also
developing the cogeneration and composting parts of its project as a Clean Development Mechanism. The co-generation
project uses renewable sources of energy (bagasse
and trash and, in a second phase, bio-gas) for power generation and will be
based on more efficient boilers than prevalent in the region. The more
efficient boilers aid higher power generation, which when supplied to the
grid displaces high GHG emission
intensive power from other sources of power generation (e.g. diesel
generators). Likewise the future composting project will prevent methane
emissions that would have happened in the absence of the project through
anaerobic decomposition of vinasse. Land rights in 1
Addax Bioenergy
SA Addax Bioenergy Sierra Leone
Ltd 35
rue de la Synagogue 6 Middle Hill Station 1204
Tel.
+41 58 702 97 00 Tel. +232 (0) 76 29 1410 April 2012
The Q&A below will hopefully
allow readers to better understand the background and features of the Addax Bioenergy project. I Biofuels, Ethanol and Sugarcane 1. What is sugarcane ethanol? Sugarcane is a grass-like
plant that grows mainly in tropical climates. It is a perennial crop, i.e.
once it is planted, it re-grows after each harvest. Sugarcane is one of the feedstocks (such as grain, maize, beet) that can produce
both sugar and ethanol. Ethanol is another word
for alcohol. It is used for the beverage and chemical industries as well as
an engine fuel. Ethanol can be blended with gasoline without engine
modifications up to a share of 10-20%. Since 2009, the ethanol share in
gasoline 95 sold in the EU is 10%. 2. Where does sugarcane grow? Sugarcane grows best in sunny, hot and humid climates
and is grown in over 110 countries. The best conditions in the world are
found in the Sao Paolo region in 3. Why is ethanol used as a fuel? In recent years, many countries have introduced
mandates for biofuels to be mixed with gasoline and
diesel. The reasons behind the biofuel policies are
many: combat climate change; energy independence from oil producing
countries; replacement of finite oil reserves; support to agriculture. 4. Does bio-ethanol really help fight
climate change? Plants which are converted to energy release no more
CO2 greenhouse gas than they absorb through photo-synthesis when they grow,
so they are by definition carbon neutral. However, often in the production of
biofuels the energy to grow and convert the crops
comes from fossil sources (oil, gas, coal) and that largely offsets the
carbon savings. Addax Bioenergy will use biomass
for power generation and organic fertilizers to maximize the carbon savings. 2 Addax Bioenergy
SA Addax Bioenergy Sierra Leone
Ltd 35 rue de la Synagogue 6 Middle Hill
Station 1204 Tel. +41 58 702 97 00 Tel. +232 (0) 76
29 1410 April 2012
Q5: What is the difference between sugarcane and
corn ethanol? Corn ethanol, as
produced in the Sugarcane produces three by-products: Sugar juice for
either sugar or ethanol; bagasse
fiber that is used to generate electric power; vinasse water residues that are used as
fertilizer. Sugarcane ethanol
refineries do not need fossil energy as the bagasse
fiber is used instead. With high-pressure boilers, modern power plants generate
enough power for the whole process and also export excess power
to the grid. Vinasse is highly nutritious and
therefore completely replaces fossil potassium fertilizer. As a consequence, sugarcane ethanol on average saves
about 80 % of greenhouse gases in comparison with gasoline. Only 1 energy
unit input is required for 9 units energy output. Sugarcane on average yields
6000 liters of ethanol per hectare of land. Unlike wheat or corn, sugarcane is not a staple
feedstock and therefore its conversion to energy is not in competition with food. II.
Addax Bioenergy and the Makeni project in 1. Who is Addax Bioenergy ? Addax Bioenergy is a
subsidiary of AOG, a diversified
investment group founded in 1987. Addax Bioenergy
was created in 2008 to develop a sustainable investment model for renewable
energy sources in 2. Why AOG was one of the first private companies to invest in
3 Addax Bioenergy
SA Addax Bioenergy Sierra Leone
Ltd 35 rue de la Synagogue 6 Middle Hill
Station 1204 Tel. +41 58 702 97 00 Tel. +232 (0) 76
29 1410 April 2012
investments in
agriculture and renewable energy, and the local communities of Makeni have welcomed
the Addax Bioenergy project. 3. Is 4. What is the Makeni project all about?
Addax Bioenergy is developing
a plantation of about 10’000 hectares of sugarcane close to the town of 5. Is the Addax Bioenergy
project going to threaten bio-diversity? Addax Bioenergy has factored
in the EU biofuel sustainability criteria, which
ban deforestation and the use of bio-diverse lands. Addax Bioenergy
has therefore designed the plantation development to comply with these rules.
The plantation area is a savannah-type land with very little tree cover and
only small pockets of biodiversity, which are being protected. An
environmental impact assessment (ESHIA) according to World Bank standards was
conducted by an independent consultancy and found the project to comply with
EU criteria on biodiversity. There are no species of fauna and flora in the
project area that would fall under the IUCN
list of endangered species. 6. Will the land conversion lead to the
release of carbon stock? A soil and surface sample analysis was conducted and
the carbon stock was found to be very low. The carbon debt was factored into
a life-cycle assessment which still
yields over 70% carbon savings, which is well in excess of the EU minimum of
35%. 4 Addax Bioenergy
SA Addax Bioenergy Sierra Leone
Ltd 35 rue de la Synagogue 6 Middle Hill
Station 1204 Tel. +41 58 702 97 00 Tel. +232 (0) 76
29 1410 April 2012
7. Will the plantation displace existing
agricultural production and therefore cause indirect land use change and additional
release of carbon? The plantation avoids the main cultivation areas in the
project area; therefore carbon emissions from indirect land use change will
be very limited at best. 8.
Sugarcane harvesting
is sometimes associated with bad labour conditions,
what is Addax Bioenergy doing about it? Addax Bioenergy has opted for
mechanical harvesting. Manual harvesting is being phased out in many
countries because it requires flash burning of sugarcane leaves before
cutting, which causes emissions and releases CO2 into the atmosphere. Cane
cutting by hand also requires thousands of unskilled migrant workers which
can cause social problems. Addax Bioenergy ensures
local people are adequately trained and have the necessary protective
equipment, and pays more than twice the average minimum salary. 9.
Will the
sugarcane be planted in food producing areas and therefore threaten food
security? Addax Bioenergy has designed
its project for minimum impact on food crop production areas and has ensured
that large areas of land are available within the project area for
communities to continue to use. 10.
What will Addax Bioenergy
do to ensure food security in the project area? Addax Bioenergy has set up
the Farmer Development Program (FDP), which is developed with and built on
the experience of the UN’s Food and Agriculture Organization (FAO) and the
Ministry of Agriculture and Food Security, to help smallholder farmers become
self-sufficient. The Addax Bioenergy FDP has
ploughed nearly 2000 hectares (3770 acres) of croplands for food production
for the communities in the project area. This in itself makes it the largest
food production program the country has ever seen. The program’s farmer
training schools provide 30week courses aimed at improving the skills and
productivity of local farmers. At April 2012, over 1,400 farmers - 70% of
whom were women - had benefited from the program, which aims to educate over
2000 farmers in all. 11.
Who will pay for the agricultural support
services? The FDP services are free of charge at establishment.
The subsidy will be phased out over three years. Services will remain
available at the option of the local communities and charged at cost through
a cost recovery mechanism. 5 Addax Bioenergy
SA Addax Bioenergy Sierra Leone
Ltd 35 rue de la Synagogue 6 Middle Hill
Station 1204 Tel. +41 58 702 97 00 Tel. +232 (0) 76
29 1410 April 2012
12.
There are not only rice paddies in the area, what
about other crops? Other crops, like cassava and sorghum are planted in
rotational agriculture. Because of the low productivity, farmers have to
rotate their fields in a long cycle (5-10 years) which means that a lot of
land is left to rest. Some of this will be converted to sugarcane. To ensure
overall food production is increased, the FDP will directly assist farmers to
grow their crops by offering the above services. The FFLS includes better
farming practices for rice as the main staple food but also for other crops,
vegetables, poultry and fruit. 13.
What about the villages, are people going to be
moved? The plantation design takes into account the villages
and development corridors around them. Therefore, no village will have to be
resettled. Some isolated settlements may be asked to relocate but they will
be offered compensation, i.e. either Addax Bioenergy
will re-build the settlement somewhere else or offer cash compensation if
that is preferred. 14.
So where will Addax Bioenergy
grow sugarcane then? The project area is a large plain with so-called “bolis” – the swamp-type depressions where most of the
local rice production takes place -, and the “uplands” – gently undulating
hills which are only sparsely used. Addax Bioenergy
will develop its sugarcane plantations mostly on the uplands. The sugarcane plantations are not going to be one big
square but rather many small circular plots (50-70 ha each) in a radius of up
to 20 km around the factory. Planting sugar cane in smaller circular fields
rather than in one big block minimises its impact
on local livelihoods and preserves much of the existing farmland and natural
reserves. 15.
Will Addax Bioenergy
need to irrigate the sugarcane fields and where will the water come from?
Isn’t that a waste of a valuable natural resource? Addax Bioenergy will use
sophisticated overhead irrigation systems to ensure that water is applied
efficiently and economically. The Addax Bioenergy
irrigation system has been refined over time and a detailed hydrology study
has concluded that it effectively mitigates any risks to water extraction.
Furthermore Addax Bioenergy will be the first
company to ever pay for water use in 16.
Are there any dangerous emissions or effluents
from the project? 6 Addax Bioenergy
SA Addax Bioenergy Sierra Leone
Ltd 35 rue de la Synagogue 6 Middle Hill
Station 1204 Tel. +41 58 702 97 00 Tel. +232 (0) 76
29 1410 April 2012
Waste-waters will be treated before
being discharged and therefore cause no harm to the environment. Vinasse will be applied to the fields as fertilizer via
the irrigation network, with precision application and minimal run-off. 17.
How did Addax Bioenergy
acquire the lands? The lands don’t belong to Addax Bioenergy, they are being
leased from the traditional landowners through the local chiefdoms, in
accordance with 18.
What is the compensation offered to landowners? Addax Bioenergy has adopted
the land lease price recommended by the Government of Sierra Leone for
agricultural lands of 5 USD per acre or about 12 USD per hectare. According
to World Bank standards, the land lease fee has to properly reflect the value
of the lands. As this differs from plot to plot, a thorough assessment is
being done in the implementation phase to assess if and what supplementary
compensation is required. 19.
Can people refuse to lease their lands? Most landowners have already indicated which parts of
their lands they are ready to lease out to the project and which parts they
want to keep for their own use. As the land leases are a private transaction,
nobody is forced to lease their lands if they don’t want to. 20.
What about the landless people? Will their rights
be protected? According to World Bank standards, nobody in the
project area should be worse off than before. This aims to protect vulnerable
people like so-called land tenants, who have been farming land or raising
cattle on lands belonging to traditional landowners. Addax Bioenergy is making sure that these people can continue
to live off alternative lands in the neighbourhood
or offer other compensation measures. Addax Bioenergy
SA Addax Bioenergy Sierra Leone
Ltd 35 rue de la Synagogue 6 Middle Hill
Station 1204 Tel. +41 58 702 97 00 Tel. +232 (0) 76
29 1410 April 2012
21.
Are people properly informed about the Addax Bioenergy project? Numerous public townhall
meetings, formal presentations and consultations have been held in the
project area during the last two years to inform the local communities and
other stakeholders about all the features of the Addax Bioenergy project. People in the project area are
continuously invited to ask questions and comment on the project. A formal grievance mechanism has been established,
which includes working committees as well as letter boxes installed
throughout the project area. 22.
What is in it for the local population? Aren’t
they going to sacrifice their livelihoods? The feedback received from the local population is
overwhelmingly positive. They are not farmers by choice but by necessity and
many young people leave the rural areas for urban centres.
The people of the Makeni area hope to be freed from poverty through stable
employment and training opportunities, and benefiting from service demands
through the project. When the project is fully operational, over 2000 people
will be directly employed and trained by the company to work in the factory and
the plantation. The project will become an economic centre and generate many
business and further employment opportunities for local businesses. 23.
Why do you intend to export all of the ethanol –
shouldn’t the local market benefit? The
African Development Bank, Addax Bioenergy and the
Government of Sierra Leone have engaged in discussions on how to establish a biofuels policy and a blending mandate for Addax Bioenergy
SA Addax Bioenergy Sierra Leone
Ltd 35 rue de la Synagogue 6 Middle Hill
Station 1204 Tel. +41 58 702 97 00 Tel. +232 (0) 76
29 1410 April 2012
24.
Who is going to buy the excess power production? Until the recent commissioning of the Bumbuna dam, only the capital 25.
There is a lot of reference made to World Bank
standards – what are these all about? The World Bank, that is to say its International
Finance Corporation (IFC), has issued a series of investor guidelines, the
so-called IFC Performance Standards.
These are adhered to by Addax Bioenergy. They
encompass the following topics: Social & Environmental Assessment and
Management Systems; Labour and Working conditions;
Pollution prevention; Community health, safety and security; Land acquisition
and involuntary resettlement; Biodiversity conservation; Indigenous peoples,
Cultural heritage. 26.
All of the above sounds like good intentions –
how can one be sure that they will be applied in the long run? Addax
Bioenergy is seriously committed to social and
environmental programs as reflected in agreements with seven development
finance institutions, including the African Development Bank (AfDB) and several European Development Finance
Institutions (DFI's). In line with these
agreements, Addax Bioenergy must meet the most
stringent social and environmental criteria in order to access financing and
adheres to ongoing monitoring by these institutions. Addax Bioenergy
SA Addax Bioenergy Sierra Leone
Ltd 35 rue de la Synagogue 6 Middle Hill
Station 1204 Tel. +41 58 702 97 00 Tel. +232 (0) 76
29 1410 April 2012 |
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