European biofuel producers were disappointed by a key vote in Parliament yesterday (11 September), which, though confirming a binding 10% target for renewables in transport fuels by 2020, shifts the focus away from agro-fuels and provides for a "major" mid-term review, which they say threatens investment in the sector.
The European Parliament's Industry and Energy Committee backed a report drafted by Luxembourg Green MEP Claude Turmes which calls for a 5% share of renewables in transport fuel by 2015 and a 10% target by 2020.
Shifting away from agro-fuels
The text nevertheless specifies that at least 20% of the 2015 target and 40% of the 2020 goal must be met from "non-food and feed-competing" second-generation biofuels or from cars running on green electricity and hydrogen.
This shift away from agro-fuels has been hailed by NGOs. But biofuel producers are angered that the new text effectively translates into a mere 4% biofuel target by 2015 – marking a regression compared to the goal of 5.75% by 2010 that the EU set itself back in 2003 and based on which the industry has already made heavy and irreversible investments.
Strict sustainability rules
The Turmes report also specifies that traditional first-generation biofuels, made from crops such as sugar, rapeseed or corn, would only count towards the target if they meet strict sustainability criteria. This includes social sustainability criteria, including respect for the land rights of local communities or the fair remuneration of all workers, as well as an obligation for biofuels to offer at least 45% carbon emission savings compared to fossil fuels – a figure that would rise to 60% in 2015.
These figures are much higher than those originally proposed by the Commission (merely a 35% saving) and also more ambitious than those currently under consideration by national governments. Indeed, after months of infighting, member-state representatives appear to have found a consensus on a two-phased approach initially requiring biofuels to offer a 35% CO2 saving that would then be scaled up to "at least 50%" in 2017, subject to a review in 2014.
The final figure will be crucial to the industry as, typically, biodiesel made from European-grown rapeseed results in a greenhouse gas saving of 44% while the typical figure for ethanol made from EU sugar beet is 48%.
2014 review sparks investment fears
What's more, the parliamentary committee is demanding that, before 2015, a full review of the whole EU biofuel promotion policy and its social and environmental impacts be carried out to determine whether the targets need revising.
This review should "focus on consequences for food security, biodiversity and the availability of electricity or hydrogen from renewable sources, biogas or transport fuels from ligno-cellulosic biomass and algae," the text reads.
Such a clause is strongly opposed by both biofuel producers and the European Commission, which fear it will create even more uncertainty and deter investments in the sector.
Strong parliamentarian support
The Industry and Energy Committee approved the compromise text by a strong majority of 50 in favour and just two against, and Turmes is confident the report will win the backing of the Parliament plenary when it votes on the dossier in October. "What more can you expect from a plenary vote," he noted.
Green MEP and rapporteur on the directive Claude Turmes, who had originally called for mandatory biofuels targets to be scrapped entirely, commented on the vote: "While the maintenance of a binding target for biofuels is a bitter pill to swallow, the committee has at least strengthened the safeguards against the damaging impacts of agro-fuels in this directive.”
"Crucially", he welcomed the inclusion of a "major review to take place in 2014, which will mean the 10% target can be reassessed if it is proving damaging" as well as the strengthening of the sustainability criteria.
But the European Biodiesel Board has criticised the Turmes report for undermining the target by "chopping it to pieces", creating "misguided" quotas for electricity and hydrogen, which "are not renewable per se and much less sustainable".
"It is sad that legislators have been swayed by superficial arguments linking biofuels to food price rises," said the board's Secretary General Raffaello Garofalo, adding that a "regression" to a 4% target by 2015 meant the industry could effectively "dismantle over four million tonnes (the 1,5% difference) of its existing capacities”.
“The economic damage to investments made in good faith by the EU biodiesel industry would be dramatic,” he stressed. Garofalo also slammed the sustainability criteria determined by the committee which it says “will have as a result to cut-off more than 80% of the biofuels produced in Europe, “strategically” favouring non-EU producers.”
The European Bioethanol Fuel Association (eBIO) further criticised the vote for putting investment security at risk, stressing that “a stable investment climate is a pre-condition to reduce greenhouse gas emissions further and to develop more advanced biofuels”.
“The Parliament puts at risk over 5 billion euro invested in EU biofuel production capacity and all the employment linked to it,” said eBIO Secretary General Robert Vierhout, calling on the Commission and member states to “demonstrate a greater sense of reality”.
European farmers, represented by Copa-Cogeca, are also intent on the 10% target, saying long-term market signals are crucial in the fight against climate change.
But NGOs say the vote marks a “welcome step in the right direction”, notably due to the major review planned in 2014, the strict sustainability criteria and the increased focus on electric and hydrogen vehicles. But many continue to believe that the 10% target be dropped entirely, arguing that "unsustainable biofuels have no place in a clean renewable energy mix".
Adrian Bebb, agrofuels campaign coordinator for green NGO Friends of the Earth (FoE) said: “Using crops to feed cars is a false solution to our climate problems and could lead to irreversible loss of wildlife and misery for millions of people in the South.”
Oxfam agreed that MEPs should have "gone further by dropping biofuels from the renewable energy directive altogether”, although it conceded that the review clause was “especially important given the links identified between biofuels and escalating food prices”.
“It is now up to member states to follow the Parliament's lead and to place the needs of poor people and the environment before those of powerful industrial and agricultural lobbies, rather than seek to water down the MEPs’ proposals,” it stressed.
- 8 Oct. 2008: Vote expected in Parliament plenary.
- Member states to agree on a common position by the end of 2008.