Agro-energy and the production of biofuels constitute a technologically proven alternative that would enable countries like Guyana to promote the modernization of agriculture, offering producers new options with a guaranteed market. The rationale for advocating that greater attention be attached to agro-energy is that this activity builds the economic resilience of countries when the forecast is for continued high and rising oil prices. In the case of the EU, for example, it has been agreed to target 10% biofuels in its fuel use by 2020.

Guyana is highly dependent for its energy on imported fossil fuels for both power generation and transport. The country is has only a very modest degree of industrialisation and primary products in agriculture, forest products and mineral contribute to a significant proportion (~ 40%) of GDP. Petroleum imports amount to more than 500,000 tons annually valued at in excess of US$220 M or 29% of the country’s import bill. These data have been summarised in a recent study conducted by  Horta and Coviello (2007) on behalf of the Economic Commission for Latin America and the Caribbean (ECLAC) for the Government of Guyana. This information is shown in Figure 1. Currently, about 36% of the country’s GDP is expended on the importation of fuels.

Diesel fuel and gasoline account for 66% and 22% respectively of petroleum product imports. Both of these could be substituted for by bio-fuels in the form of ethanol for gasoline, bio-diesel for diesel transport fuels and agriculture and wood wastes for thermoelectric power generation now met mainly by diesel plants.

Guyana’s participation in the agro-energy sector has the potential to have a significant impact on poverty reduction, industrialization and diversification of the traditional pillars of agriculture; sugar and rice. Such microeconomic benefits would also be mirrored by significant macroeconomic benefits: for example, Guyana spent a full 28% of the total value of imports into country on fuel in 2005. Clearly, any reduction in this alarming percentage will allow significant foreign currency savings, which, rather than representing a drain on the country’s resources, would have been re-invested into the economy. The potential for a cushioning of price fluctuations of crude, and the corresponding security derived from a domestic fuel supply will have significant impacts on the country’s growing and still fragile economy. Furthermore, within a context of global and regional concerns regarding climate change abatement, Guyana’s participation in the agro-energy sector could have significant impacts on the reduction of greenhouse gases and criteria air contaminants through the use of cleaner bio-fuels and wastes.

The significant advancements in agro-energy production, utilization, and (increasingly) exportation, made in neighbouring Brazil and other countries provides opportunity for learning and models for development and growth of this sector. Certainly, from a global perspective, the timing for an aggressive pursuit of agro-energy in Guyana now is sensible, as it would coincide with major collaborative efforts between the United States and Brazil, as well as heightened focus on agro-energy with the European Union.

Although the country has taken steps to utilise its significant resources in hydroelectricity potential, an urgent need remains for liquid fuel for vehicles and heavy machinery. Furthermore, a significant percentage of the country’s rural population depends on the burning of wood for cooking purposes. Whilst the combustion of biomass as sources of power for electricity generation is in its infancy in the country as the nationally owned sugar corporation GUYSUCO begins to incinerate bagasse as a source of thermo-electric power, significant potential exists for harnessing the country’s oversupply and underutilized sources of combustible biomass.

According to Binger (2006a), the potential Agro-energy industries for the Caribbean (including Guyana) are in two areas: liquid fuels for transportation and, solid fuels for electricity generation. Further, it was stated that the potential Agro-industries must include the assessment of the raw material potentially available, the cost and reliability of the technologies that convert the biomass feedstock into intermediate form or final use form, and how these technologies impact the viability of biofuels production and use; and the institutional capacity at the national level.

According to Binger (2006 b), biomass feedstock can be converted into biofuels in many different ways making it possible for each country to evolve its own strategy based on available resources and infrastructure. The Government of Guyana has recognised that agro-energy has an important role in the country’s future development, even if petroleum is produced. This sector would be aggressively pursued both from an export standpoint as well as for the production of biofuels for domestic consumption.