Other major biofuel producers include China, which has grown its bioethanol production sector rapidly since 2000 to become the third-largest single bioethanol producer after the USA. Total capacity from four plants in 2005 was about 1.3 billion L, but continued high prices for international oil has led the National Development and Reform Commission to announce that biofuel production will increase dramatically, providing China with the ability to re­place about 2 million t of crude oil by 2010, and 10 million t by 2020 [63]. The Commission also announced that China would begin shifting to non-grain feedstocks, including sweet sorghum, for bioethanol production [63]. Jilin Fuel Alcohol remains the world’s largest corn-based bioethanol plant with a current capacity in excess of 350 million Lyear-1 [64]. The biofuel industry in China has been subsidized, mostly in terms of funds to construct biofuel plants. Some Chinese provinces have announced biofuel mandates, although the national government has not yet made any decision about legislating bio­fuel use [63].

A country poised to be a major biofuel producer is Canada, which cur­rently produces about 250 million L annually [15]. Much of the funding being made available to fund research and development in biofuels in Canada has depended upon the federal government’s environment strategy. This strat­egy has evolved significantly with the ascension of a Conservative minority federal government in 2005, who made a campaign promise to introduce a 5% biofuels mandate. An agreement with provincial governments on the 5% mandate was reached in May, 2006, which will see this mandate take full effect by 2010 [65]. Recently, the federal government announced the proposed Clean Air Act, which was tabled on 19 October 2006 [66]. Unfortunately, the pro­posed Act does nothing to codify the government’s biofuels target, and does not provide concrete policy incentives for additional biofuel use. To help spur some biofuel development, Agriculture and Agri-Food Canada is providing CAD $ 10 million (approximately US $ 8.7 million) in the fiscal year 2006/2007 through the Biofuels Opportunities for Producers Initiative (BOPI). The ob­jective of the Initiative is to help agricultural producers develop business plans for new biofuels projects [67].

Previous governments have provided more substantial support to biofu­els, including a cumulative investment of CAD $ 2.7 billion (US $ 2.34 billion) into the implementation of the former Climate Change Plan for Canada [68], which included incentives for the development and use of environmentally — friendly technologies including bioethanol. The federal Canadian govern­ment provided direct funding for the industry through the Ethanol Expansion Program, which in 2004 and 2005 provided a total of CAD $ 118 million (US$ 102 million) in direct funding for 11 projects, six of which are cur­rently in active development [69]. The federal government provides an excise tax exemption for biofuels, as do the provinces of Manitoba, On­tario, and Alberta [70]. Most recently, the Alberta government has an­nounced a commitment of CAD $ 239 million (US $ 207 million) to expand the province’s bioenergy sector by encouraging products including biofuel development [71]. Other nations with biofuel-friendly policies include Aus­tralia, where a bioethanol production subsidy is in place that replaces excise tax exemptions at a rate of approximately US$ 0.21 L-1 produced. Capital subsidies have been provided for two bioethanol production plants [64]. In Thailand, excise taxes are waived for bioethanol. In Latin America, produc­tion schemes in Peru and Columbia have been linked to urban renewable fuel standards in Columbia [64]. In a move designed to utilize surplus pro­duction, the sugar industry in India has successfully lobbied the government for state-level E5 fuel mandates, which were passed in September 2002 and which apply to nine states and four territories. In order to support these man­dates, an excise tax exemption was granted and bioethanol prices have been fixed by a Tariff Commission [72]. Production from other nations will become more important as capacity comes on-line and the international market for bioethanol continues to develop.

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