Will biofuels lead to deforestation? Photo by Mike Warren.

When it comes to fighting global warming, biofuels are all the rage these days. Just ask Richard Branson, the hot-air baloon adventurer, whose post-industrial empire includes Virgin Atlantic, Virgin Limousines, Virgin Active and almost any other word that can come after “Virgin.” That’s because Mr. Branson, after watching Al Gore’s famous PowerPoint, has become “obsessed with alternative energy” and plans to invest up to $3 billion of his personal fortune into bio-fuels. Is this a strategic miscalculation?

The UN just released a new report, Sustainable Bioenergy: A Framework for Decision Makers, which warns that a rash adoption of biofuels could spell disaster for the environment and certain sectors of the global economy. As the report warns, “Use of large-scale mono-cropping could lead to significant biodiversity loss, soil erosion and nutrient leaching.” But there is an upside: the report explains that biofuels could be influential in mitigating the effects of global warming and improving people’s livelihoods, especially if they are engaged in activities other than farming that are higher up the value chain.

On another note, the report suggests that bio-fuels should not be used to power cars, trucks, and buses: “Current research concludes that using biomass for combined heat and power (CHP), rather than for transport fuels or other uses, is the best option for reducing greenhouse gas emissions in the next decade – and also one of the cheapest.”

As for Branson, only time will tell if his latest adventure will take off or end in a crash landing.