Alternative fuels need more backing from EU states, says panel

This article is part of our special report Rural Energy.

A debate organised by think-tank Friends of Europe concluded that there was a need for a co-ordinated approach to alternative fuels from all stakeholders and politicians, particularly at member state level.

As global energy demand is expected to grow in the next decades, Europe is faced with rising public concerns over energy dependence from outside regions and environmental issues. Road transport is under particular strain in this respect as it lies at the intersection of sometimes conflicting interests between the commercial and competitiveness requirements of road freight and vehicle manufacturers and issues such as public health, traffic congestion and climate change.

In this context, alternative fuels appear like a possible 'silver bullet'. The question remains as to which ones will gain support from stakeholders across the board, including vehicle manufacturers, green activists and public authorities at all levels. 

Alternative fuels currently competing for support include LPG (Liquid Petroleum Gas), BTL (biomass-to-liquid), hydrogen and the diesel substitute DmE (dimethyl ether). However, they need to meet a whole range of expectations coming from consumers (performance, safety), suppliers (distribution, network) and manufacturers (costs, attractiveness, performance). 

Policy-makers speaking at this Friends of Europe debate tried to give an assessment of those fuels from a "well to wheels" perspective.

Speaking for the Commission's Environment DG (Unit Air, Noise and Transport), Peter Gammeltoft said the technologies were "of secondary importance" but should be considered as "a means of achieving an objective," namely combating climate change. However, he added that alternative fuels were not in a position to become widely available any time soon and admitted that fossil fuels were "likely to dominate the picture for many years to come". "There are a number of promising fuels out there", but if one is to take the lead, he said "we need to regulate". He cited the EU's biofuels directive as a useful instrument but warned that biofuels were "not a panacea". "They can make us progress but we need to look at other alternatives". "I don't see at the moment any way of forcing this issue on anybody," he added. "What we can do is provide [tax] incentives, even if it's a cent per litre."

This was not a view shared by Paul Hodson, from the Commission's Transport and Energy DG. "There is one fuel that we are certain will be on the market, it's biofuels," he said. "We don't know when", he argued, but as oil prices continue to go up and stocks continue to decrease, "we will end up adopting them". In his opinion, biofuels are "dead easy" to develop, and "don't really require major adaptation to cars," he argued. Moreover, he argued, they offer opportunities to poorer countries and offer EU farmers alternative sources of income.

Green MEP Satu Hassi, vice-chairwoman for the Parliament's Environment Committee, insisted on the necessity to find carbon neutral solution as climate change is "the biggest threat to our civilisation". Pointing out that transport is currently the sector where "[CO2] emissions are increasing more rapidly than in any other sector", she suggested giving incentives to industry by including transport in the EU's CO2 emissions trading scheme. 

The head of the Automotive Unit at the Commission's Enterprise DG, Reinhard Schulte-Braucks, drew attention to the newly created   CAR21 high-level group to boost the competitiveness of the car industry. One of the group's tasks, he said, will be "to develop a sustainable automotive industry in Europe", including the promotion of greener vehicles and the development of new technologies, most prominently the fuel cell. 

Concerning biofuels, he expressed scepticism: "If we want to promote an alternative fuel that is relatively expensive, we must convince finance ministers of practically all member states to provide tax incentives," which currently appears a challenging task. However, he suggested that Europe "might need legislation for the distribution of alternative fuels," which could include the security aspects associated with distribution at filling stations. 

Schulte-Braucks also expressed scepticism concerning hydrogen vehicles, which according to him, can not be marketed before 2020. He also downplayed the success of hybrid (oil-electric) vehicles currently being marketed by Japanese makers as being "clearly not as attractive" as conventional cars.

Peter Danielsson, Environmental Manager, at Volvo spoke in favour of the diesel substitute DmE (dimethyl ether) being developed by his company. DME, he said, "can build the bridge between fossil fuels and biofuels". He said he would like to see more research and funding efforts made on biofuels in the Commission's next research programme, FP7. Market forces, he insisted, are the best to choose between alternatives.

Ivan Hodac, Secretary General of the European Automakers Association (ACEA) pleaded in favour of a global solution, not just a European solution. "We cannot make the EU car industry less competitive with respect to the US or Japan due to environmental protections. […]Alternative fuels are in the stage of infancy. We need incentives for such new fuels but there also must be market acceptance - the consumer must buy the product and cars must be safe".

A debate organised on 17 January by Friends of Europe in association with vehicle manufacturer Volvo assessed the situation of alternative fuels in Europe. The debate, entitled "Fuelling tomorrow's road transport: from well to wheels", was moderated by EURACTIV's Editor-in-chief Willy De Backer.

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