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 Last update: September 15, 2010

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 Biofuels

 

In April 2009 the EU Council of Ministers and the European Parliament adopted the Renewable Energy Directive (RED).  This is part of the EU Climate Package and includes the 20-20-20 goals for the year 2020: a 20 percent reduction in green house gas (GHG) emissions compared to the levels of 1990; a 20 percent improvement in energy efficiency compared to current forecasts for 2020 and a 20 percent share for renewable energy in the EU energy mix.  Part of this 20 percent share is a 10 percent minimum target for renewable energy consumed in transport.

 The 20 percent renewable energy goal is an overall EU goal, whereas the 10 percent renewable energy in transport is to be achieved by each Member State. The Commission realizes the EU will not be able to produce all the feedstock needed to reach this goal, and imports of feedstock and biofuels are part of the plan.  Introduction of electric vehicles will also contribute to the achievement of the 10 percent goal.

 The EU requires that biofuel meet certain criteria to receive tax incentives and apply toward the targets. The criteria include greenhouse gas (GHG) savings minimums, protection of biodiversity, and effects on indirect land-use change (ILUC). Legislation requires that all biofuel used in the EU, whether produced in the EU or a third country, has to be certified by a control body certified by the Member State authority or the Commission.

 The Commission has made complex calculations to determine the GHG savings for specific feedstock with a minimum requirement of 35 percent.  Calculations for soybeans from South America were set at 31 percent, below the minimum requirement. U.S industry believes that if the same methodology were used for U.S. soybeans, the results would be above the minimum. ILUC is not yet incorporated in these calculations. The Commission is not expected to report on this until December 2010.

 The Commission placed provisional anti-dumping and countervailing duties on imports of biodiesel from the United States in the spring of 2009, which became permanent July 7, 2009. Prior to the duties, the EU was becoming an important market for U.S. biodiesel. Exports increased from 50,838 MT in 2006 to 1.1 million MT in 2008, when the United States held 17 percent market share in the EU. During the first quarter of 2010, EU imports of ethanol from the United States also sharply increased and were greater than those from Brazil.

In August 2010 the European Commission initiated an investigation concerning the possible circumvention of the imposed countervailing duties and anti-dumping measures. This investigation was requested by the European Biodiesel Board (EBB).  The Commission will investigate if imports consigned from Canada and Singapore originated in the United States and whether imports of biodiesel blends containing less than 20 percent biodiesel are to be seen as an attempt to evade the duties. The investigation will should be concluded within 9 months of the date of publication which would be May 11, 2011.

Reports 

EU-27 | 2010 Biofuels report:  The EU as a whole is not expected to achieve its Directive 2003/30 target of 5.75 percent in 2010. Next year, blending is even expected to stagnate, mainly due to reduced biodiesel use in Geny. In contrast to biodiesel, bioethanol production and consumption is anticipated to trend further upwards during 2011 driven by the introduction of E10. The biofuel targets for 2020, laid down in the EU Energy and Climate Change Package (CCP), were adopted by the European Council on April 6, 2009. This package includes a 10 percent minimum target for renewable energy consumed in transport to be achieved by all EU Member States. Biofuels have to meet certain criteria to be taken into account for this 10 percent goal. EU Member States will have to submit their national action plans by June 2010. This report also covers developments in the EU biogas and biomass market.

Commission Communications on Sustainability and Voluntary Schemes:

 

In June 2010, the Commission published two Communications to encourage industry, governments and NGO’s to set up certification schemes. One Communication concerns the practical implementation of the Sustainability Scheme, and the other concerning Voluntary Schemes and default values. In the Communications the Commission explicitly rules out that forests can be converted into palm oil plantations. Reactions from stakeholders in Brussels on the Communications have been generally positive.

Germany Extends Transition Period - POS Required for 2010 Harvest:

Germany has extended the transition period for implementation of the sustainability certification requirement for biofuels and their feedstock from July 1, 2010 to January 1, 2011. Nevertheless, the majority of biofuels and biomass from the 2010 harvest will require a “proof of sustainability certificate” (POS) when exported to Germany. This report also provides links to certification systems.  

 

 

 

Links

bullet New and Renewable Energies (Directorate-General for Energy and Transport. European Commission)
bullet Biomass Action Plan (European Commission)
bullet Bioenergy Agriculture Research (European Commission)
 

 

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