According to Dutch Socialist MEP Dorette Corbey, Parliament rapporteur on the issue, the Fuel Quality Directive must include criteria ensuring that the biomass used to produce biofuels is "at least partly traceable", has not been planted near nature areas or protected sites and does not lead to deforestation or water shortages.
While she acknowledges the current Commission moves to draw up sustainability criteria as part of the future Biofuels Directive, she stresses that these do not yet exist and that separate criteria are needed in the meantime to prevent the lifecycle reduction obligation causing unsustainable production of biofuels.
"This directive will provide a massive incentive for biofuels. But because the Commission has not yet put its own sustainability criteria on the table, the European Parliament has no other choice than to give its own guidelines," she told EURACTIV, adding: "It would have been better if the Commission had first of all drawn up sustainability criteria and then the carbon dioxide target."
As regards claims that lifecycle reduction is incompatible with the EU ETS, she stressed: "The ETS only provides an incentive to reduce carbon dioxide and does not impose any absolute obligation. Oil companies can, after all, decide to purchase emission rights on the commercial market. Both the ETS and the directive now under consideration provide incentives: neither of them actually imposes a requirement to improve efficiency at refineries. In other words, they reinforce each other and at least do not conflict."
EPP-ED MEP María del Pilar Ayuso, however, replied to Corbey's report by saying: "We are not in favour or against [sustainability criteria] but this is not the right place. We should stick to the subject of the proposal."
The European Petroleum Industry Association Europia stressed the inconsistency between promoting higher quality fuels and biofuels on the one hand and the introduction of a lifecycle approach on the other, saying that such an approach would put highly-upgraded refineries, capable of more complex conversion techniques, at a disadvantage because they are often more energy-intensive, and that this would ultimately create a "perverse incentive" for the incomplete and inefficient conversion of crude oil.
It added that the target of achieving an annual 1% reduction of fuels' lifecycle emissions was "premature" and called for it to be deferred until an appropriate methodology for calculating full-cycle greenhouse gas emissions, which "resolves the potential overlap with the ETS and assesses the feasibility of a reduction target in line with the upcoming Renewables Directive as well as business, economic and social impacts", is established.
The European Bioethanol Fuel Association (eBIO) said that the proposals were "well-meaning" but warned that they risked creating "a policy barrier to the development of second-generation biofuels as well as a host of other problems". It explained: "Focusing solely on the greenhouse gas savings of biofuels leaves other sustainability concerns out of the equation. Biofuels with relatively high greenhouse gas savings, such as Brazilian bioethanol, are not necessarily produced in an environmentally sustainable manner." In order to address this situation, eBIO believes the solution is to subject only fossil fuels, and not renewable fuels, to the 10% lifecycle greenhouse gas reduction goal.
eBIO adds that both the directives on fuel quality and renewables should also be accompanied by rules aimed at raising the automobile industry's minimum capacity for biofuel consumption.
Car manufacturers, on the other hand, welcomed the lifecycle approach. "The focus of the Commission is still far too much on vehicle technology," the European Automobile Manufacturers Association's (ACEA) Communications Director Sigrid de Vries said, adding that it is "important that the fuel industry takes part" in reducing transport emissions.
Inland Navigation Europe (INE), an association that aims to promote freight traffic on the inland waterway network, says sulphur levels for barges should be cut to 10 mg/kg as soon as 2010. According to INE, delaying the introduction of stricter sulphur limits until 2012 would only serve to "significantly delay the replacement of older engines by more energy-efficient ones, because these newer engines cannot run on 300ppm fuel".
The Commission's two-phased approach would also be detrimental to shipowners that have already replaced their engines because no ultra-low sulphur fuel would be made commonly available on the market, says INE.
It adds: "Last but not least, the Commission proposes 300ppm fuel only for inland waterways, while road transport and non-road machinery will use 10ppm fuel. The additional costs of producing and supplying a separate type of fuel only for inland waterway transport will undoubtedly be passed on to the users, while most inland ship engines can run without major complications on 10ppm fuel."
Green transport NGO T&E has termed the proposal an "ingenious climate measure" and said its measures could "make a big contribution to reducing demand for bad oil".