Building on the biofuel sector's healthy start

PUBLISHED : Monday, 26 May, 2008, 12:00am
UPDATED : Monday, 26 May, 2008, 12:00am

The city's first licensed bio-diesel plant is less than a year old, but other operators are already planning to set up operations here. InvestHK says bio-diesel companies from North America and the mainland have also shown interest. As a base for model biofuel plants, Hong Kong is seen as attractive by some players in the booming sector .

Given all the red tape involved in entering the industry here, this is an encouraging development. That is because it could take two years or more before companies secure the environmental, fire safety and building licences for their plants to begin recycling, and at least that long again before they show a return on their investment. It is to be hoped that the latest proposals will come to fruition.

Biofuel, being renewable energy, mitigates climate change by cutting greenhouse gas emissions. It shows the value of recycling, which the government encourages. In its first eight months, the existing operator produced 76,000 litres of bio-diesel from 80,000 litres of used cooking oil, and sold it all for use in construction industry power generators. Hong Kong has a long way to go before recycling and the use of biofuel in engines matches what has been achieved overseas, but that is a start.

The ultimate success of such ventures, however worthy, has to depend on the quality of their products and market forces. There would have to be a compelling argument for any form of subsidy. There is, however, a case to be made for the government to be more flexible in helping green industries like recycling get off the ground. Governments elsewhere have found ways to help them. Singapore's, for example, has a unit that helps fast-track them. Others have found that voluntary schemes like the ones in place here have had to be made compulsory to achieve a change in community mindset.

In the long run, Hong Kong must collaborate with the mainland to enable such industries to develop the scale and standards necessary to deliver the desired environmental benefits. That could involve the transport of waste materials across the border - a problematical issue, but one that can be solved with Guangdong authorities if there is political will on both sides.