France’s palm oil tax saga continues

"Parliamentarians have been clear. They voted to end the niche tax benefiting biofuels made from palm oil, which obviously includes the PFADs," said Greenpeace's Jérôme Frignet.

French NGOs and multinational oil and gas company Total continue their arm-wrestling over the tax status of palm oil used in crop-based biofuels. EURACTIV France reports.

In France, the fate of palm oil has been the subject of a series of twists and turns, particularly as NGOs and Total continue to fight over the issue.

Initially, the French government had adopted a national strategy to ban outright the use of palm oil for crop-based biofuels, as part of its fight against imported deforestation. The strategy had great ambition, particularly as it included a plan to make the issue part of international trade agreements, for instance.

France gives green light to palm oil despite European Parliament’s ban

While the European Parliament has decided to ban palm oil imports by 2021, France recently gave the go-ahead for a biorefinery owned by Total, a move that prompted many critics. EURACTIV.fr reports.

But the strategy has come to a standstill. Driven by purely French agricultural interests, as France is the leading producer of biodiesel from rapeseed, the strategy was not welcomed by Total. For its part, the oil giant was developing a biofuel unit made from palm oil at its biorefinery in La Mède, France.

MPs then tried to remove palm oil from the list of crop-based biofuels benefiting from a tax advantage. Although the Constitutional Council, influenced by Total, initially cancelled the proposal twice, it eventually validated the decision to remove fiscal incentives for palm oil.

The incentive tax on the incorporation of biofuels, known as TIRIB, has nevertheless changed. It now excludes products such as diesel and gasoline produced from palm oil.

But in an unexpected twist, France’s Directorate General of Customs has returned the Palm Fatty Acid Distillate (PFAD) to the list of biofuels benefiting from the tax exemption, thus sparing part of the production of Total’s Mède plant, which produces so-called advanced biofuels or those made from palm oil co-products.

“Parliamentarians have been clear. They voted to end the niche tax benefiting biofuels made from palm oil, which obviously includes the PFADs,” said Greenpeace’s Jérôme Frignet.

The NGOs, who met with Ecological Transition Minister Elisabeth Borne on 21 January, filed an application with France’s Council of State, contesting the Directorate General of Customs’ use of the texts.

According to Laura Buffet of Transport and Environment, a European umbrella for NGOs working in the fields of transport and environment, the “European Union recently decided to stop supporting palm oil in fuels because of deforestation. The ‘PFAD’ is clearly synonymous with palm oil, and that is why France should not support its use in fuels”.

EU Parliament ends palm oil and caps crop-based biofuels at 2017 levels

The European Parliament decided today (17 January) to phase-out palm oil by 2021 and cap the crop-based biofuels at the 2017 member states’ consumption levels and no more than 7% of all transport fuels until 2030.

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