For a world that is under extreme stress due to the rising cost of food (a 40pc global increase was recorded last year), and ballooning prices of fossil oil - although the latter has shown a certain degree of moderation, declining to 125 dollars per barrel last week after a 70pc growth last year - spending billions of dollars in research and development, as well as conducting a series of conferences on alternative energy sources is understandable. There is an obvious scramble to develop alternative fuel from bio-energy.

It is no surprise, therefore, that countries in East Africa have organized a grand conference scheduled for September 2008, in Dar es Salaam, Tanzania, to talk about bio-fuel as an alternative energy. The main focus of the discussions should include the continent’s capacity to produce this substitute fuel, as well as how best bio-fuel could be used.

Six “leading experts” have been earmarked to deliver presentations alongside the sharing of their insights and analyses of “practical case studies” by close to 10 panelists. Ethiopia will be represented at this sub-regional conference by only one participant; Jiregna Gindaba (PhD), a crop scientist from Sun Biofuels, will speak on his company’s experience in developing bio-fuel in Ethiopia.

A major sponsor of the event, Sun Biofuels is also a pioneer firm in developing alternative sources of energy by growing jatropha on a 10,000hct plot it was allocated in the Southern Regional State. But it is not alone in this venture, as 25 other companies have expressed interest in getting involved in the fledging bio-energy industry, 10 of which are already operational.

A good example is Flora-EcoPower, a German based company that penetrated Ethiopia’s investment climate about two years ago. Not only has this company invested 232.5 million Br for the cultivation of castor seed on the two plots it received in East Hararage Zone( with a total area of 119,000hct), it has also made an arrangement with 20,000 farmers in five weredas of West Hararge area to farm the seed and then supply it to the company.

Sheikh Al-Amoudi’s Horizon (with a 100,000hct plot in Benshangul Regional State and a 58000hct one in Gambella), and Yemiru Nega’s Abaye Gallana (with 34,000hct in Guji Zone of Oromia Regional State), as well as Petro Palm’s 50,000hct in Bale Zone and Global & Energy’s 40,000hct in Southern Regional State are among the list of pioneers in the infant industry.

They deserve credit and support for taking the risk to help a nation whose significant portion of foreign exchange earnings is eaten up by a the hike in the price of fossil fuel. An amount of over one billion dollars worth of fuel is pumped into vehicles and industries with a minuscule share in Ethiopia’s total energy demand.

Research conducted by the Addis Abeba University claim that close to 90pc of Ethiopia’s energy is consumed by households; almost 95pc of this demand is met by what experts describe as “biomass.” Electricity, largely produced from hydroelectric power, only covers 0.7pc of this national energy requirement, according to this study. Yet, close to 80pc of the nation’s foreign currency earnings is consumed by the import of oil, whose share to the total energy requirement is a mere 4.3pc.

Unfortunately, overdependence on biomass (fuel wood) has dire consequences on the environment. That much is clear to all. With the prospect of the oil price hitting 200 dollars per barrel - if projections made by some firms are realized - the burden on Ethiopia’s foreign currency reserve will become impossible to carry further. Policymakers need to be creative in developing a strategic plan that could help the nation fend off this catastrophic development.

Indeed, the Council of Ministers deserve appreciation for passing what has come to be a Strategic Plan for Bio-fuel Development, endorsed in September 2007. It indicates the priority accorded by policymakers in the search for perhaps one of the most crucial potential problems that may lead the economy into paralysis.

Nonetheless, the use of alternative energy in bio-diesel has yet to pass its age of controversies, although environmentalists are keen to promote it as a “green source of power.”

True enough, there is an unprecedented growth in bio-diesel production all over the world; for instance, Latin American countries spent over eight billion dollars in 2007 to produce ethanol and bio-diesel, Brazil being the region’s leading producer with an output of 23 billion litres in 2007/08; this makes it the largest ethanol exporter in the world. In 2006, Brazil claimed 33pc of all the ethanol fuel traded in the international market.

If underdeveloped African countries wish to follow this path, it is a logical decision. With their potential of vast land not put to use so far, a considerable investment in this area could help them produce alternative energy just to save themselves from the onslaught on their foreign exchange reserve. They could perhaps be able to export and supplement their traditional export items, currently limited to primary (agricultural) goods.

But there are concerns expressed across the world that allege that the use of land for bio-diesel purpose is competing with food production, thus contributing to the rising cost of food on a global scale, leaving 30 million people to the prospect of hunger, according to Oxfam.

Global demand for corn, wheat and Soya bean has surged in a manner seen no time before; convincing critics to attribute the added demand from those that produce bio-diesel from ethanol. It does not seem to be a baseless allegation: A World Bank report blamed the use of grains, oil seeds and sugarcane for bio-fuel purpose in developing and developed nations for sharing three quarters of hikes in food prices in poor countries.

There is also a credible fear that an expansion of investment in bio-fuel related farming will inevitably fuel the demand for agricultural land, it will be a matter of time before they get to compete with farms that produce grains and oilseeds for food. It appears that prospect is not too far off, if one considers the recent confusion due to a plot granted to Horizon in the Benshangul Regional State.

Ethiopia’s Strategic Plan for Bio-fuel Development clearly discourages the use of arable and fertile land for the use of bio-diesel related production. However, a recent visit by a delegation from the Ministry of Agriculture and Rural Development discovered that not all the plot designated to Horizon in Benshangul was in line with this policy: Of the 100,000hct, close to 15000hct was found to be fertile enough for food production. That was quite an appropriate incident to confirm critics’ worry that most of the land given to investors farming castor seed, jatropha and palm oil for bio-fuel development are in agriculturally productive areas.

For a nation that is struggling to make its people food secure, this is a kind of controversy that is too much to bear. It ought to be the job of policymakers and regulators to police the industry so that its operators are disciplined. But there is also a crucial need to keep a delicate balance between disciplining pioneers in an area where almost everyone is a student, and the responsibility of the state in encouraging them in its quest for an alternative source of energy.

Policymakers should start the job by introducing two important documents that have come short of passing a strategic plan. Coming up with a land use system, where prospective investors are granted plots clearly certified not to be suitable for food production is one. However, this can not do what a guideline should; the latter should be an instrument where the voice of those concerned with the environmental effect is adequately incorporated.

Should the government fail to do that pretty soon, then it ought to prepare itself for a scenario similar to that observed in neighbouring Kenya, where community groups have taken the government to court over a controversial sugar project in the River Tana Delta costing 369 million dollars , which aims to produce ethanol and generate power.