The toxicity of the seeds is mainly due to the following seed components: a toxic protein (curcin) and diterpene esters. Curcin is similar to ricin — the toxic protein of the castor bean. The pure substances are the most potent toxins in the plant

kingdom and will kill human beings when administered in quantities of only a few micrograms. Also, use in animal nutrition is not possible without detoxification. Several universities like Hohenheim in Germany and the University of Sichuan in Chengdu, China, have been able to remove the toxic elements from Jatropha. Thus, in the future the seedcake can not only be used as an organic fertilizer, but also as animal feed.

The Russian KGB used ricin to kill people. Georgi Markov, a Bulgarian jour­nalist who lived in London, was killed in 1976, probably with ricin poison that was contained in an umbrella spike.

З.!.?

Whole Plant and Food/Fodder

As described above, the plant is widely cultivated in the tropics as a "living fence” in fields and settlements. This is mainly because it can be easily propagated by cuttings and is planted densely for this purpose. In Mali, for instance, there are several thousand kilometers of Jatropha hedges.

3.1.8

Today, the wholesale price for kerosene-type jet fuel is $1.90 per gallon. The US Energy Information Administration (EIA) forecasts the price to be $2.70 in 2013 and $3.52 in 2017. This contrasts with a cost to produce Jatropha oil jet fuel today at about $1.50 per gallon. Thus, unless the forecasts are wildly incorrect, jet fuel made from Jatropha oil should become very competitive in the marketplace. In addition, since pricing will continue to be set or strongly influenced by petroleum prices for many years, the gross margin for Jatropha jet fuel is already attractive and should remain high.

Assuming a wholesale price of $2 per gallon for Jatropha jet fuel, the total addressable market for jet biofuel is $168 billion and the total amenable market (at the 10% blending level) is $16.8 billion. A market share of only 10% at a 10% blending level (20 million barrels per year) thus represents $1.68 billion in value.

The annual global kerosene consumption is 276 million tonnes. To replace 10% of fossil fuel-based kerosene with bio jet fuel, an annual production of biofuels of 28-30 million tonnes is required, which is in line with the annual consumption of soybean oil or palm oil. With the new EU carbon credit scheme in effect in 2012, all airlines will scramble to buy the available biokerosene.

3.3.11

Pennycress (Thlaspi arvense), a winter-grown crop that produces twice the oil per acre of soybeans, has become a potentially attractive biofuel source. The crop is harvested in the spring between segments of a typical corn/soybean rotation (double cropping).

The US Department of Agriculture (http://www. ars. usda. gov/is/pr/2010/101104 .htm) plans to establish geographically dispersed, advanced biofuel production plants using pennycress seeds. Harvested pennycress seeds contain about 36% oil, and

after oil extraction and conversion to biodiesel, the remaining material, called presscake, can be burned, gasified, or pyrolyzed to bio-oil. Both the extracted oil and the presscake become value-added products. It is estimated that an acre of pennycress can produce 95 gallons of biodiesel and another 95 gallons of bio-oil. In addition to its high yield, it is easy to grow and helps prevent soil erosion.

Pennycress is also important to the agricultural industry as the plant can potentially generate over $200 million annually in new farm income per million acres cultivated.

4.8

Moringa

The hardest thing to see is what is in front of your eyes.

Goethe — German writer, artist, and politician.

The Moringa oleifera tree is a possible solution to the “food-or-fuel” debate as Moringa gives both food and fuel. Since this book is about biofuels and biomass we start by stating that the pods of the Moringa tree contain 38-40% of non-drying, edible oil. Apart from its nutritional value it can also be converted into biodiesel, and the seedcake left after pressing can be used and sold as animal feed. Like Jatropha, Moringa grows best around the equator and does not survive freezing temperatures. It is here that the comparison with Jatropha stops!

The Moringa tree is the supermarket tree in your garden. Moringa is being promoted to combat poverty and malnutrition, and it is taking Africa by storm. It grows quickly in many types of environments and much of the plant is edible, for humans and animals alike. Other names for the Moringa tree are horseradish tree or drumstick tree.

The leaves contain all the essential amino acids, and are rich in protein, vitamin A, vitamin B, vitamin C, and minerals. Feeding the high-protein leaves to cattle has been shown to increase weight gain by up to 32% and milk production by 43-65%.

The defatted seedcake can be used in water purification to settle out sediments and undesirable organisms, which is perfect in areas where poverty is a major problem.

This tree, although little known in the Western world, is nutritional dynamite. The immature pods are the most valued. The pods are extremely nutritious, con­taining all the essential amino acids along with many vitamins and other nutri­ents. The immature pod can be eaten raw or prepared like green peas or green beans, while the mature pods are usually fried and possess a peanut-like flavor. The seedcake after oil pressing contains 61% protein. Overall, its nutritional value most closely resembles olive oil.

The leaves are eaten as greens, in salads, in vegetable curries, as pickles, and for seasoning.

Moringa is a natural nutrition for the tropics — 25 grams daily of Moringa leaf powder will give a child the following recommended daily allowances: protein 42%, calcium 125%, magnesium 61%, potassium 41%, iron 71%, vitamin A 272%,

and vitamin C 22%. These numbers are particularly astounding, considering this nutrition is available when other food sources may be scarce. These leaves are a powerhouse of nutritional value. Gram for gram, Moringa leaves contain: 7 times the vitamin C in oranges, 4 times the calcium in milk, 4 times the vitamin a in carrots, 2 times the protein in milk, and 3 times the potassium in bananas.

After the oil is extracted from the pods, the seedcake remaining contains the active components for removing turbidity (solid particles) from water. Since bac­teria adhere to the solids, this seedcake also effectively removes bacteria.

Moringa has another major advantage — it can be produced locally. Using Moringa can generate farm and employment income. The potential for Moringa to create a new market for a community is substantial.

4.8.1

Coal is a non-renewable source of energy. Burning coal emits harmful gases and waste such as carbon dioxide, sulfur dioxide, nitrogen oxides, sulfuric acids, arsenic, and ash, and has led to major environmental impacts like acid rain in some regions. Coal excavation requires a significant amount of energy and coal is generally transported from remote locations over long distances, leading to higher carbon emissions. Lignite causes problems in transportation and storage due to its high moisture and ash content, and is susceptible to spontaneous combustion. It is also difficult to crush, pulverize, and combust. It has a lower heating value, which means that more fuel must be handled to produce a given amount ofpower (Table 8.3).

8.8

Jatropha plantations can improve the lives of many poor people living in rural areas. In the provinces of Yunnan and Sichuan you virtually only see women. The men work in sweatshops at the coast making your iPhones, Nike shoes, and Levi jeans. Working at the plantation can generate income, improve the quality of life, and increase the self-esteem of the farmers.

The gap in China between the “haves” in coastal cities and the “have-nots” in the countryside is getting bigger and bigger, and poses a major problem for the Chinese government. According to the UN Development Programme (UNDP) Human Development Report 2006, there were 23 million people are living below the national poverty line and 57% of China’s population was living in the undeveloped rural areas.

China is facing a widening gap on disposable income between rural and urban populations. The per capita income of an urban resident is now 3.3 times that of a rural resident — the biggest gap in Chinese history. With more than 700 million residents living in rural areas, the Chinese government is now focused in policies and actions aimed at reducing this divide.

Officially, China is still categorized as a developing country with a per capita annual income of approximately $8382 in 2011. From 1978 to 2008, per capita income increased 6-fold and the number of people living in absolute poverty, according to national poverty line criteria, decreased from about 260 to about 14 million. Despite China’s strong and sustained economic growth, poverty is still persistent, especially in remote rural areas. Income inequalities between eastern and western China have broadened, and the income gap between rural and urban residents has widened considerably since the late 1970s. Urban incomes are now more than 3 times higher than rural incomes. China’s government is taking strong measures to correct this trend by increasing investment in rural areas, especially in infrastructure, irrigation, education, and health.

The prevailing view of poverty in China, according to the World Bank, holds that it is exclusively a rural phenomenon, especially prevalent in western China, remote areas, and minority regions; it is highly concentrated in clusters of poor villages; and it is more prevalent among girls, women, and the elderly, mainly affecting people who are unable to work.

The report, “China — From poor areas to poor people: China’s evolving poverty reduction agenda — an assessment of poverty and inequality in china” (www. worldbank. org/external/default/WDSContentServer/IW3P/IB/2011/01/24/0003330 … 2011-01-25) finds that while there are elements of truth in some of these per­ceptions, poverty is far more differentiated in China.

• Conventional wisdom is right on one count, in that almost all of China’s poor live in or come from rural areas. Poverty is an almost exclusively rural phenomenon, with 99% of China’s poor hailing from rural China. Even if migrant workers are excluded from the rural population, 90% of poverty is still rural. Even when applying a cost — of-living differential between urban and rural areas that is higher than the official standard, rural poverty would account for over 80% of overall poverty.

• Geography and ethnicity are relevant, but they are not the sole determinants of poverty. Levels of poverty are higher and more severe in China’s western regions, but nearly half of the poor are in other parts of the country. People living in remote, mountainous areas are 2-3 times more likely to be poor than those who live in more central areas and the incidence of poverty among ethnic minorities is 2-3 times higher than among the Han Chinese. Still, about half of the poor in China are neither living in remote areas nor members of an ethnic minority. Jatropha plantations in China are in the remote pour areas of Yunnan, Sichuan, and Guangzhou.

• Children, especially girls, are more likely to be poor than the elderly. Overall, poverty rates for male and female adults and the elderly population are very close — between 12 and 13%. However, poverty rates are higher among children under 16 years old: 16% of boys and 17% of girls are poor. Girls are also more at risk than boys of becoming poor.

• China is classified under the Organization for Economic Cooperation and Development/Development Assistance Committee as a “lower-middle-income country.”

• The World Bank estimates that 320-350 million Chinese are still living on less than $2 a day. The gap between rich and poor is widening.

• China does not have an overall, economic and accessible healthcare system. Only 14% of employees hold unemployment insurance, 18% health insurance, and 23% retirement schemes.

• Unemployment is on the rise. The official unemployment rate in urban areas is at 8.5%, in the country at 30%. This leads to migration, especially to the urban centers in the east.

• Around 70% of China’s energy use is based on coal, with other forms of energy each accounting for only a tiny proportion, according to official statistics.

12.10.8

Investors know what is driving the resource boom: growing demand from China and India as well as restraints on increasing supply. However, what most investors have not quite grasped is the sheer enormity of these drivers. Often our under­standing tends to lag behind reality; how many of us could think, for example, 15 years ago that e-mails or social networks like Facebook would become such dominant factors in the way we communicate?

Likewise, prices of most resources will go higher and for longer than most investors currently imagine. The key is per capita demand. China currently con­sumes just less than 4 kg of copper per person per year; Japan, Germany, and other industrialized countries each consume 12-14 kg. Take oil: as you can see in Figure 1.7, the USA currently consumes around 21 million barrels of crude oil per day and China around 6 million barrels. If we compare the consumption per capita in each country, the average American citizen consumes around 27 barrels a year, industrialized countries from Korea, Japan to Europe around 17 barrels and a Chinese citizen 2.7 barrels per year.

Significantly, the pattern of demand growth in all these countries has been remarkably similar: from very low starts, slow appreciation as the economy starts to industrialize until a “takeoff” point is reached; this is then followed by rapid acceleration that lasts a decade or more until the economy matures and per capita consumption levels off.

The pattern has been the same, for country after country, in resource after resource. What is significant about China, of course, is the scale; there are an awful lot of capita’s in that country — about 20% of the world’s population — and they all want the same things we take for granted in the industrialized countries (better housing, electricity, automobiles, stoves, refrigerators, etc.). All of these things require resources and far more than what they replace. Increasingly, not only do the Chinese people want these things, but also more and more Chinese

citizens are moving up the middle-class ladder and have the financial means. China today is right at the cusp of that take-off point when per capita consumption starts to accelerate.

Now, China will not necessarily move to the industrialized world norm in the consumption of various resources. It may use less oil per person than other countries, for example. It uses more coal for power and plans on using more nuclear power; there may be increased efficiencies and more viable "green” alternatives. However, China’s consumption of oil and other resources will increase; in 2010, it became the world’s number one oil consumer. It may not reach the industrialized world norm, but it will approach it. Even at one-third the industrialized norm of oil consumption, this would mean a doubling of China’s per capita demand. Similarly, with copper: perhaps China will eventually use only half as much copper as other industrialized economies. That would mean a 50% increase in per capita consumption — remember, again, we are talking about per capita consumption. China is already the top consumer in absolute numbers for most commodities.

Thus, based on history, there is enormous potential left and we are only at the end of the beginning. Many commentators are concerned about the effect China’s tightening policy will have on the economy and demand for resources. However, even if China’s growth slows from 9 to 5%, that would still imply a dramatic and continuing increase in demand for resources, and for many resources today there is no meaningful inventory.

I am not suggesting that there cannot be a slowdown in China’s economic growth. I am suggesting that, unless China’s development comes to a halt, the demand for resources will accelerate over the next 5-10 years and there is nothing on the horizon now to suggest that that demand can be met without higher prices. The biggest problems in China are the discrepancy between the incomes in rural areas and in coastal zones. Inflation keeps creeping up and it remains an open question if the Chinese government will be able to keep inflation in check, and thus domestic stability. China is a "leading indicator” in commodities. Unrest in China and a declining Chinese demand will have profound affects on world trade and commodity demand.

1.8

Jatropha can be harvested in the form of managed and contract farming. With managed plantations, farmland and labor are directly controlled by the company or through its subsidiaries and affiliates. The farmers are salaried employees of the plantation company. Under contract farming, the company, with the help of local governments, will establish agreements with local farmers or cooperatives to buy back harvested seeds at fixed prices. The company will supply seedlings, arrange

bank financing, provide support and advice during cultivation, and monitor the conditions of the crop. The company does not own the land and pays the farmers per day, per hectare, or per kilogram of harvested fruits.

To spread the financial risks, a combination of managed and contract farming spread out over several regions and countries is the best strategy in plantation management.

Jatropha grows in a belt between 30° north and 30° south of the equator. As you can see in Figure 3.4, the palm oil belt is much smaller — around 15° north and 15° south of the equator. Growing conditions for Jatropha are ideal in countries like Indonesia, Laos, Cambodia, and even South China. Practically the whole African continent and a large parts of South America have excellent climatic growing conditions.

Nothing can beat oil palm in terms of yield per hectare because of the years and years of research that have been done. However, in countries where you cannot grow oil palm, such as China and Vietnam, Jatropha can be the highest yielder of vegetable oils. One hectare of oil palm trees yields about 4 tonnes of crude palm oil, or about 10 times the productivity of soy. Jatropha, if properly cultivated, yields between 2.5 and 3 tonnes of oil/hectare. We expect China, India, and Indonesia, where land is in ample supply, to be the biggest Jatropha oil producers in the long­term in Asia, with the number of hectares potentially reaching into the millions. In Africa, many countries like Ethiopia, Ghana, Namibia, Mali, and Mozambique can become important biofuel producers.

The main disadvantage of Jatropha is the fact that it only grows in tropical cli­mates, not like sugarbeets, algae, or Camelina — all feedstocks that can be grown all over the world.

3.12

Let us put socially responsible investing in a wider context. The question of the kind of economic system most likely to deliver the greatest benefit to society is not about capitalism versus communism. In our world with global warming, the question is what type of capitalism will maximize sustainable economic growth. The last decade clearly demonstrates free and unfettered markets ("market fun­damentalism”) do not deliver optimal long-term results.

The global financial crisis in 2007 had its origins in short-term, unsustainable strategies and actions. Before the crisis and since, we have called for a more long­term and responsible form of capitalism — what is sometimes called "socially responsible investing.” It explicitly integrates environmental, social, and govern­ance factors into strategy, and into measuring outputs and assessing risk and opportunities. Socially responsible investing challenges us to generate financial returns in a long-term and responsible manner.

Sustainability and long-term wealth creation are closely linked. In essence, our economic activity is based on the use of natural and human resources. Business and markets cannot operate in isolation from society or the environment. In addition, the sustainability challenges the planet faces today (i. e., the climate crisis, poverty, oppression of women, pandemics, water scarcity, migration, and urba­nization) are extraordinary and completely unprecedented. It is business and the capital markets that are often best positioned to address these issues.

6.6

Biofuels have become the first real test case for a post-oil era in which food, animal feed, fuel, and chemicals compete for land in a new bio-economy. Whatever conclusion the European Union reaches, it may set the agenda for sustainable land use for the future. It touches on social issues, environment issues, trade issues, energy issues, and more.

At the EU headquarters in Brussels intense emotions in the debate over one of Europe’s most contentious environmental issues unfolds — the use of biofuels, long touted as an alternative to carbon-emitting petroleum. There is a huge rift in Brussels over biofuel policy. It is a war that pits the European Commission’s

agriculture experts against its climate experts, and Europe’s auto and farming lobbies against environmentalists.

10.5