The EU yesterday (17 October) launched new rules to account for indirect greenhouse gas emissions from biofuels, sending what EU Climate Commissioner Connie Hedegaard called a clear signal that first-generation biofuels were “not the future in Europe”.

Appearing in a joint press conference with Energy Commissioner Günther Oettinger, Hedegaard said that the compromise paper was not perfect but would ensure that future European biofuels were “more sustainable than they would have been without this proposal.”

“Climate-wise, some of the biofuels [receiving EU subsidies] are as bad as, or even worse than the fossil fuels that they replace,” she said.

This is because of indirect land-use change (ILUC), a process whereby carbon sinks are destroyed outside of Europe to cultivate land for biofuels crops. ILUC was demonstrated in scientific models and confirmed by indigenous peoples’ experiences in developing countries. 

The new proposal, which will amend both the Biofuels and Fuel Quality Directives, contains measures aimed at preventing the EU from providing incentives for the continued displacement of food crops for fuel. These include:

  • A 5% cap on the amount of biofuels in the EU’s 2020 transport mix;
  • An end to public subsidies for biofuels after 2020 unless they can demonstrate “substantial greenhouse gas savings”;
  • A quadrupling of credits for second-generation biofuels, to provide production incentives;
  • A 60% greenhouse-gas-saving threshold that will apply to new biofuels installations from 1 July 2014;
  • A review of policy and scientific evidence on ILUC, which will take place in 2017.

But the EU backtracked on its initial draft plans to introduce mandatory accounting for the indirect greenhouse gas emissions of specific feed-based biofuels under the Fuel Quality Directive.

As a result, first-generation biofuels may still be counted towards meeting the EU’s separate target for a 6% reduction in fuel greenhouse gas emissions, even though leaked EU data corroborate Hedegaard’s assertion that some may indirectly emit more greenhouse gas than fossil fuels.

Missed opportunity

Environmentalists said that the EU had missed an opportunity to correct past mistakes by admitting the error of originally promoting first-generation fuels.

“To paraphrase Keynes’ famous quote, the Commission chose to be precisely wrong rather than roughly right,” said Nuša Urbančič, the fuels programme manager for Transport and Environment.

Representatives of the first-generation biofuels industry were even more unhappy, arguing that the proposals would only signal to investors that the EU lacked policy coherence and predictability.

“It is crazy to think that killing first-generation of biofuels will give any incentive to develop the second generation,” said Isabelle Maurizi, a spokeswoman for the European Biodiesel Board.

“There is too much uncertainty about who would pay for it now, as first-generation providers won’t be on the market any more to invest in it,“ she added.

But the EU believes that it is charting a clear path by giving inputs for the future, without punishing investors who expect a return on what they believed was a definitive EU policy direction until 2020. 

“As ever, some people say we are not doing enough and others say we need to do more,” Oettinger said at the joint press conference. “I think we’re seeing a middle way.”

No mistakes

Responding to a question from EurActiv, Hedegaard said that the EU had acted judiciously in 2009 by incentivising biofuels, while leaving the door open for future measures on ILUC.

“Everyone was aware that there might be such a thing as ILUC, but the science at that time was not very well developed,” she said. “It was not a mistake that it wasn’t done at that time.”

But "the time is here" now, she added.

Many academics, scientists and Brussels officials believe that the story of how the EU’s biofuels target came to be set is more complex and controversial than Hedegaard suggested.

At the Commission’s headquarters, often divided on the biofuels question in the past, there appeared to be relief yesterday that a potential policy time bomb had been defused, at least for the moment.