There is a considerable potential for the production of second-generation biofuels. Even if only 10% of the global agricultural and forestry residues were available in 2030, about half of the forecasted biofuel demand in the World Energy Outlook 2009 450 Scenario could be covered – equal to around 5% of the projected total transport fuel demand by that time.

• To ensure a successful deployment of second-generation biofuels technologies requires intensive RD&D efforts over the next 10-15 years.
• The technical development will mainly take place in OECD countries and emerging economies with sufficient RD&D capacities like Brazil, China and India.
• In many developing countries, the framework conditions needed to set up a second-generation biofuel industry are not currently sufficient. The main obstacles that need to be overcome include poor infrastructure, lack of skilled labor and limited financing possibilities.
• Investments in agricultural production and infrastructure improvements would promote rural development and can significantly improve the framework for a second-generation biofuel industry. This will allow developing countries to enter second-generation biofuel production once technical and costs barriers have been reduced or eliminated.
• The suitability of second-generation biofuels for countries’ respective needs has to be evaluated against other bioenergy options. This should be part of an integrated land use and rural development strategy, to achieve the best possible social and economic benefits.
• Capacities should then be built slowly but continuously in order to avoid bottlenecks when the new technologies become technically available and economically feasible. To ensure technology access and transfer, co-operation on RD&D between industrialized and developing countries as well as among developing countries should be enhanced.
• Agricultural and forestry residues should be the feedstock of choice in the initial stage of the production, since they are readily available and do not require additional land cultivation.
• More detailed research is still needed to ensure that second-generation biofuels will provide economic benefits for developing countries. This research includes a global road map for technology development, an impact assessment of commercial second-generation biofuel production, and improved data on available land. Additionally, more case studies could enable further analyses of local agricultural markets, material flows, and specific social, economical and environmental benefits and risks in developing countries.

Research gaps and next steps

• It is still too early to fully assess the potential social, economic and environmental impacts of largescale second-generation biofuel production in practice. The following research steps are suggested to understand better the potential and impact of second-generation biofuels in developing countries and emerging economies:
• Creation of a global road map for second-generation biofuels, to enable governments and industry to identify steps needed and to implement measures to accelerate the required technology development and uptake. Set-up of pilot and demonstration plants outside the OECD in order to develop supply chain concepts, assess feedstock characteristics, and analyse production costs in different parts of the world.
• Collection of field data from commercial second-generation biofuel production from residues to better understand impacts on agricultural markets and the overall economic situation in developing countries.
• Improved data accuracy on sustainably available land in developing countries to determine the potential for dedicated energy crops.