European Commission releases proposal to alter biofuel policy

By Erin Voegele | October 17, 2012

The European Commission has released a proposal that aims to make significant changes to the EU’s biofuel policy. According to the commission, the proposal will limit the global land conversion for biofuel production and increase the climate-related benefits of biofuels consumed in the EU.

The proposal also seeks to limit the use of food-based feedstocks for biofuel production. “This is to stimulate the development of alternative, so-called second generation biofuels from non-food feedstock, like waste or straw, which emit substantially less greenhouse gases than fossil fuels and do not directly interfere with global food production,” said the commission in a statement. “For the first time, the estimated global land conversion impacts—indirect land use change (ILUC)—will be considered when assessing the greenhouse gas performance of biofuels.”

The proposal seeks to amend the RED in several specific ways. First, it sets a 60 percent minimum greenhouse gas (GHG) saving threshold for new production. The commission said this change is designed to improve efficiency of biofuel production processes and discourage additional investments in production facilities that have low GHG reduction performance.

Second, the proposal includes ILUC in the reporting of GHG savings of biofuels and bioliquids by fuel suppliers and EU member states. Estimated ILUC emissions published in the proposal assigns 12 grams of CO2 equivalent per megajoule (gCO2eq/MJ) for cereals and other starch rich crops. The relative ILUC for sugars and oil crops are estimated to be 13 gCO2eq/MJ and 55 gCO2eq/MJ, respectively.

Third, the proposal aims to maintain the target that calls for 10 percent of transportation fuel to be renewable by 2020, but sets a 5 percent limit on the use of crop-based biofuels and bioliquids.

Finally, the proposal would establish incentives for biofuels that result in little or no ILUC emissions. Feedstocks that do not create additional demand for land, including algae, straw and waste, are those targeted for incentives in the proposal.

Representatives of the European biofuel industry are speaking out against the proposal, saying that it will decimate the region’s biofuel industry in the midst of the European economic crisis. A joint statement released by Coceral, Copa-Cogeca, the European Biodiesel Board, the European Oilseed Alliance, the European Renewable Ethanol Association (ePURE) and Fediol stresses that the groups strongly oppose plans to limit crop-based biofuels and include ILUC emissions in RED.

“A proposal based on unfounded and immature ILUC science and a 5% cap in 2020 would destroy the biofuels industries and related sectors such as crushing and sugar facilities,” said the group in a statement. “It would also cut off European farmers from a key market, reducing the crops diversification. Any change in policy must safeguard the investments made and ongoing toward fulfilling the commission’s initial objectives of 10 percent renewable energy for transport production in the EU. Fundamental problems remain in the EC proposal which will have devastating impact on the biofuels industries and diversification of farmer’s revenues.”

The biofuel groups also stressed that it was totally unacceptable of the commission to use the International Food Policy Research Institute report to introduce ILUC values, as the report has not been peer reviewed. “The model used for the report is not suitable for precisely estimating the extent of land use change and the resulting greenhouse gas emissions, due to critical data errors and important methodical problems,” said the biofuel organizations. “As such, any ILUC figures especially as high as 55g for oilseeds are arbitrary. The review clause in 2017 leads to more regulatory uncertainty, discouraging investments in advanced biofuels plants.”

The biofuels organizations have criticized several other components of the proposal, including the 5 percent cap on crop-based biofuels, which they said could bring development in the sector to an abrupt halt, and lead to a slowdown in industrial and agricultural activity and job loss. In addition, the biofuel organizations said that multiple counting is not going to boost the advancement of advancement of biofuels, and that reversing policy decisions made two years ago will diminish investor confidence. Finally, the groups noted that phasing out biofuels made from certain crops will not increase food security or bring down prices.

“The EU farmers and biofuels industries look forward to working to ensure that an industry that plays a crucial role in reducing greenhouse gases, enhancing Europe’s energy independence; and creating sustainable jobs, remains viable,” said the organizations in the joint statement. “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. We strongly urge the European Parliament and the Council to incorporate changes to rectify these problems and look forward to working with them to that end.”

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