RTÉ Europe Correspondent Tony Connelly looks at the problems associated with some of the first generation of biofuels, and examines the push to develop more sustainable alternatives to fossil fuels

Of all the solutions for reducing our reliance on greenhouse gases and tackling climate change, using crops and plants which grow freely in the ground seemed initially one of the most promising.

Already, Brazil powers tens of thousands of cars using the most common biofuel, ethanol, which is derived from sugar cane.

But recently the downside of biofuels has hit the headlines and sent planners and policy makers back to the drawing board. The most spectacular disappointment has been palm oil.

Palm oil caught on about five years ago. It was always used in cooking and cosmetics, but suddenly it was seen as an ideal, cheap alternative to burning oil. Power stations in the West, too, could easily be adapted to run on the stuff.

The Netherlands was the first country to pour money into palm oil. The government there issued millions of euro in subsidies for palm tree plantations in Indonesia and Malaysia.

Meanwhile in Holland, but also in other EU countries, power plants were prepared for the first arrival of palm oil extract – companies even began investing in power plants which would run on palm oil alone.

But then disaster struck. A Dutch NGO, Wetlands International, published a disburbing report on the effect of the palm oil gold rush.

The four-year study showed that palm oil was a double whammy in the wrong direction. Thousands of square kilometres of virgin rainforest were felled to make way for the palm plantations, and at the same time peatlands were dried.

Both acts contributed disastrously to the release of CO2. In the case of the peatlands, drying them out releases carbon dioxide which has been captured and stored there.

Over 600 million tonnes of CO2 were released from bogland destined for the new palm oil plantations. Marcel Silvius, a climate expert at Wetlands International, said: 'As a biofuel, it's a failure.'

Since then a new international certification process has been set up so that plantations and exporters are prone to inspections to ensure that any future production of palm oil is sustainable.

But palm oil is not the only case where the so-called first generation of biofuels has backfired.

Billions of dollars are being invested in biofuels world wide as the planet rushes to find a clean alternative to fossil fuels. In fact, research in the US into biofuels is the recipient of the second largest amount of venture capital.

But the most immediate – and from a public relations point of view, shocking – clash has been with the food supply. The plant life favoured to make bio-diesel and bio-ethanol is also the food we eat: corn, wheat, sugar, soya.

Since farmers – especially in the US corn belt - began seeing the lucrative gains they could make, more and more switched to crops which could be turned into biofuel.

But that hit the price of commodities. Biofuel companies were competing with food merchants to get their hands on the corn and fewer farmers were growing it to produce food stocks.

The result: the price of food – corn, wheat, etc – has soared. Biofuels were not the only culprits: persistant bad weather like flooding and droughts are also to blame, as is the soaring demand for better nutrition from emerging economies countries like India and China.

And that hits consumers all over the world. In Italy there was a one-day strike at the price of pasta, and in France shoppers are up in arms over the price of the famous baguette.

So the first generation of biofuels have something of a bad name.

The Okura Hotel in Amsterdam was where, on 4 and 5 October, the second generation was being unveiled.

A look at the speakers list revealed the importance with which global megacorporations are treating this.

Philip New, the president of BP Biofuels, John Ranieri, Vice President of DuPont, Dr Dan Arvizu, Director of NREL, the US National Laboratory on Renewable Energies and US President George W Bush’s leading expert on the subject.

The essence of the next generation of biofuels is how to save the planet without worsening global poverty.

That means getting the best out of the plant and making the most out of the limited growing land the planet has to offer.

But the challenge is fraught with difficulties. How can we access more land without upsetting the environmental balance? How do you convert plants into fuel and get that the fuel into cars? Who pays for the equipment and infrastructure? (John Ranieri of DuPont pointed to the painful shortage of engineers and steel in the world.)

And how do you convince car manufacturers to take the risk and develop new vehicles to run on largely untested fuels?

One of the first solutions, according to Mr New (right),  is to find the 'killer applications'. The first generation of biofuels simply squeezed the oil or the valuable seed out of the plant – i.e., the part which ends up in our food - and discarded the rest.

The next generation will have to use the whole plant so that fuels and foods do not compete. And that will require a complex technical process called cellulosing: using microbiology to convert the stalks and left over stuff into sugar which in turn can become energy.

Science is still chasing the holy grail of cellulosic fuel, but other methods are being pursued.

Some plants, like Elephant Grass, which is already being trialed in Ireland, can produce biofuel but not food, so there is no competition between the two.

Another is making better use of land. Already cocaine farmers in South America are being encouraged to crow biofuel crops instead. In eastern Europe, certain biofuel friendly plants can also help remove heavy metals from badly polluted soils.

A key speaker at the meeting, Andre Faaij from the Copernicus Institute at the University of Utrecht, gave a startling statistic on how the world will evolve over the next 43 years.

'At present 5,000 million hectares are being used to meet the food needs of 6 billion people.  But if we use land efficiently, we would only need 1,000 million hectares of arable land to feed the population by 2050, even though that population will have grown to 9 billion,' he said.

In other words the remaining land could be used to grow biofuels.

In Ireland co-ops are already setting up rapeseed crushing plants to provide biofuel, but we will never have the land mass – or the climate – to produce enough fuel to run our own fleet of cars and lorries.

That is why we will rely on the US corn belt and other powerhouses of the world to meet our needs, if we are to switch away from petrol to biofuel.

'Some Irish companies are already becoming global players,' says Robert Geraghty, Senior Development Advisor with Enterprise Ireland.

Not so much in growing biofuel crops, but in converting organic waste into energy, which follows the same principle.

Bioverda, a company owned by National Toll Roads, has just invested a staggering €500m in bio-diesel plants in Germany and the US.

The secret for Ireland's point of view is in developing the expertise and technology to be able to convert organic waste into energy and then export those ideas.

And in a Utopian way, the regions which could, according to Mr Faaij, become the powerhouses of the future based on the land they have available are the ones which are today among the poorest – Africa, South America, Eastern Europe.

It is a beautiful dream, but the perils are huge. Just ask the people of Indonesia.

- Tony Connelly