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EU rethink on biofuel targets

natalie hamill, 25 September 2012

In 2009 the EU’s Renewable Energy Directive set a number of targets to encourage EU member states to implement greener energy policy, including an obligation for member states to have 10 per cent renewable energy in their transport fuel mix by 2020.  Biofuels, particularly first generation biofuels which are developed from food crops, are the most established and offer the only real chance for EU member states to get anywhere near this target… but at what cost? As the industry faces growing criticism the European Commission has proposed restricting the use of crop-based biofuels to a maximum of 5 per cent of  the 10 per cent transport renewable energy target.


Biofuels are developed from living matter and, as a potentially cleaner and more sustainable source of fuel than fossil fuels, were initially hailed as a ‘green bullet’ in the fight to reduce carbon emissions. The EU’s mandates have pushed for increased production of crop-based biofuels in particular as member states strive to reach the renewable energy targets; in fact, crop-based biofuels account for around 90 per cent of the renewable energy used across the EU member state transport sectors. However, continued research into crop-based biofuels has cast serious doubt over whether they really can offer a desirable alternative to fossil fuels, casting a shadow over the EU’s 2020 biofuel mandates.

Perhaps the most serious criticism levelled at the EU’s biofuel targets is its link to world hunger. At the moment, despite continued research into other sources, biofuels are almost exclusively made from photosynthetic plants, either crops high in sugar (e.g. sugar cane) or starch (e.g. wheat) or from crops high in vegetable oil (e.g. palm oil). There is growing evidence that this diversion of land for growing fuel instead of food is contributing to the hike in food prices and that it is exacerbating poverty and hunger around the world. Prices for corn and soy bean (popular biofuel crops) reached record highs in 2012 and Oxfam estimates that, by 2020, some staple foods will have seen a 36 per cent price increase. The land and crops which could be used for food in developing countries are instead being diverted to fulfil EU biofuel targets. Oxfam’s latest report, ‘The Hunger Grains’, finds that if the land used to grow biofuels for the EU in 2008 had been used to grow wheat and maize instead, it could have fed 127 million people for the whole year.

With growing evidence around the negative impact of these food-crop biofuels there has been increased interest in second generation (cellulosic) biofuels (such as using the waste from crops, e.g. wheat stalks) and even third generation biofuels such as algae (which has the potential of giving 30 times more energy per acre than food crops). However, research and development of second and third generation biofuels is costly and remains a long way off from offering a practical alternative to the amount of energy currently being sourced from crops. For now the pressure to reach EU targets is falling on crop-based biofuels and with the use of these crops limited, the EU will significantly reduce its chances of meeting the 10 per cent transport fuel target by 2020. However, given the turning tide of opinion regarding these particular biofuels and what part they should play in the fight against climate change, the Commission’s rethink couldn’t be more timely.

There is a second reason behind the EU’s cap on crop-based biofuels. A number of recent studies have found that the reduction in carbon emissions from using these particular biofuels instead of conventional fossil fuels may have been grossly overestimated. The intensive process of harvesting and converting food crops to fuel is not always accounted for in emission saving calculations, and neither is the indirect land use change (for example clearing forests to make way for crop land or draining peat bogs) suggesting that for many first generation biofuels their sustainability may be significantly lower than initially thought.

So will the EU’s 5 per cent cap on crop-based biofuels make a real difference? The first thing to note is that the figure isn’t an arbitrary one; EU consumption of crop-based biofuels is currently around 4.5 per cent, so the EU is putting a stop to further expansion rather than reversing its current share. However, the second part of the Commission’s proposal is to end all subsidies to the crop-based biofuel industry after 2020, this may well shrink their hold of the market as well as opening up more investment opportunities for other, less established biofuels.

The Commission has made it clear that it is not pushing biofuels off the agenda; rather it aims to shift the reliance from crop-based biofuels to alternative and more sustainable sources. ‘The Commission’s message for post-2020 is that our clear preference is biofuels produced from non-food feedstocks… We are pushing biofuels that help us cutting substantial CO2emissions, do not compete with food and are sustainable and green at the same time,’ the Commissioner for Climate Action and the Commissioner for Energy said in their joint statement last week.

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