EU Backtracks on Biofuel Proposal

1 November 2012

Biofuels policy in the EU has recently gone through substantial shifts. A proposal leaked in September revealed that the European Commission was drastically rethinking its policy (see Bridges Trade BioRes, 19 September 2012), capping biofuels based on food crops at a five percent target - out of an overall ten percent - and including considerations of indirect emissions related to their production. However, when the EU officially released its proposal on 17 October, not all changes were retained. Crucially, greenhouse gas emissions resulting indirectly from biofuel production due to the encroachment of farming into forests or other ‘carbon sinks' such as peatbogs - known as ‘indirect land use change' in EU jargon -would merely be reported on, but not factored in when calculating greenhouse gas efficiency.

As part of a broader push to scale up renewable energy in the EU, national governments must currently ensure that ten percent of energy in the transport sector comes from renewable sources by 2020, according to mandatory targets set out in the Renewable Energy Directive three years ago. The Commission's proposal would ensure that food-based biofuels account for no more than five percent.

The greenhouse gas intensity of road transport fuels must also be cut by six percent under separate legislation known as the Fuel Quality Directive. Both goals are widely expected to be reached mainly through increased reliance on biofuels.

Under the new proposal, so-called advanced biofuels based on waste, algae and other non-food feedstock, would be double or quadruple-counted towards the target in order to further incentivise their production. European Commissioner for Climate Action Connie Hedegaard said: "For biofuels to help us combat climate change, we must use truly sustainable biofuels. We must invest in biofuels that achieve real emission cuts and do not compete with food. We are of course not closing down first generation biofuels, but we are sending a clear signal that future increases in biofuels must come from advanced biofuels. Everything else will be unsustainable."

Campaigners were quick to criticise moves in the official proposal to water down some of the main requirements in the leaked draft. "While the European Commission proposal limits today's bad practices, it does not fundamentally steer future bioenergy in a sustainable direction, because it still does not account for ILUC emissions from biofuels," said Nusa Urbancic, programme manager for fuels at Transport & Environment, a Brussels-based NGO. "The biofuel industry won," said Marc-Olivier Herman from Oxfam's EU Advocacy Office in Brussels, for his part, in comments to Bridges. Development and environmental groups have been heavily opposing the use of biofuels due to links to food security and questionable overall environmental impact, especially when indirect effects are considered.

However, representatives from the biofuels industry were also far from upbeat. In a press release, European farmer and biofuels associations said that ‘Today's proposal fails to recognize what the EU farmers and biofuels industries have achieved to date. It will jeopardize investments, jobs in rural areas and prevent development of advanced biofuels.' Industry representatives also doubted that the five percent cap coupled with quadruple-counting would effectively help usher in advanced biofuels. Currently, most advanced biofuels are based on used cooking oil, and quadruple-counting would put further pressure on the used cooking oil market and potentially lead to an increased risk of fraud. While there have been advances with regard to advanced biofuel production from other feedstocks, the picture remains spotty and small-scale.

Rob Vierhout, the secretary-general of ePure, Europe's bioethanol association, speaking at a roundtable in Brussels organized by EurAktiv, also highlighted the lack of trust the current policy shift had led to. "We have invested in good faith because there was a clear political signal and we're not even half way into the game and they're changing the rules," he commented. "No football player would accept that."

The negotiations following the release of the proposal are likely to take up to two years; only then will the revised legislation be adopted and enter into force.

ICTSD reporting; EU PRESS RELEASE; ‘EU biofuels rules a step forward, not perfect, Commissioners say,' REUTERS, 17 October 2012; ‘EU Makes Radical Shift on Biofuels,' WSJ, 17 October 2012.

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