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The EC's proposals for biofuels in its "Fit For 55" package of
policies attempt to correct past mistakes, but they call for tough
reforms in sectors with a low appetite for change.
Today's renewable transportation fuel frontrunner is
biofuels—of which around 80% is biodiesel made from food crops
like rapeseed—but its carbon-cutting benefits are hamstrung by
the use of crops imported from overseas, which results in
deforestation that devastates carbon sinks. This may be why the EU
has decided to ease off supporting those crops and reshape markets
for biofuels in the proposed revision of the Renewable Energy
Directive (RED II) published on 14 July.
While IHS Markit analysts see crop-based biofuels as the current
leaders in the decarbonization of transportation under RED II,
under the proposed revision as it is currently worded, states may
need to reduce their crop-based biofuels consumption in favor of
fuels that use alternate feedstocks.
The EC would also like to see, for example, ships and cars use
electricity, and new advanced biofuels that come from feedstocks
like waste or "energy crops," specific types of trees that grow on
land that is not devoted to arable use, or algae, recycled carbon
fuels, and electricity-based fuels such as green hydrogen. The EC's
proposal seeks to make its fuel wishlist a reality even though
these fuels are high in cost and low in availability.
Raising RED again
Rounding off a decade of renewable energy and biofuels growth,
the adoption of a revised RED would mark the third time since 2009
that targets have been revised upwards. Now, the transportation
targets are being upped because the existing ones are not high
enough to put the EU on a carbon-neutral path.
Under prior versions of RED, member states were assigned
specific renewable electricity and renewable fuel targets for
transportation. The 2030 bloc-wide target for renewables as a share
of energy in transportation is 14%. The EC suggested in the July
proposal that this is far too low: The bloc will need to reach not
14% but 27-29% by 2030.
Thanks to the combined efforts of states and despite a few
laggards, the EU was expected to achieve its bloc-wide 2020 RED
target for electricity, and the progress towards the RED target for
the transport sector is similarly uneven. The EC in October 2020 expected to exceed its overall
10% renewable energy in transportation target for that year despite
11 states not fulfilling their mandatory obligations.
The stubborn transportation sector is still transitioning at
"the slowest pace," according to the EC. The vast majority of
transportation in the EU relies on fossil fuels, and sector-wide
emissions are increasing, the EC said in the proposal.
Advanced biofuel, e-fuel targets praised
Today, member states meet their RED transport targets by passing
laws promoting the use of biofuels, but in the future,
electrification of transport may play a bigger role.
Several of the Fit For 55 proposals, including a credit
mechanism in the latest RED revamp, would significantly aid the
electric vehicle charging market.
But the overall target that counts both electricity and biofuels
is set to change. The RED revisions change the metric for the RED
transport target, replacing the current 14% renewable energy
consumption target in 2018's RED II with a 13% GHG intensity
reduction target for the fuels and electricity used for transport.
The EC says this will "stimulate an increasing use of the most
cost-effective and performing fuels, in terms of greenhouse gas
savings, in transport."
While this target may not look ambitious at first, the EC
regards this as "increasing the ambition level of renewables in
transport." This is partly because the proposed target counts GHGs
and partly because it captures the whole transportation sector,
including ships and planes, whereas only road and rail
transportation are currently regulated. The metric aligns with what
some in the biofuels industry called for in 2020.
Campaigners have said the 13% GHG reduction target will
encourage both environmentally sound and damaging activity. "The
new targets in the revision of the RED II are certainly very
ambitious. They're much higher than what was already in the RED II,
which is good in some ways and bad in some ways," Stephanie Searle,
fuels program director at the International Council on Clean
Transportation (ICCT) campaign group, told Net-Zero Business
Daily.
One target that is green is the sub-target within the GHG
reduction target that would see advanced biofuels increase from at
least 0.2% in 2022 to 0.5% in 2025 and 2.2% in 2030, Searle said.
This is because advanced biofuels are mostly cellulosic biofuels
like wheat straw that do not create damaging carbon sink impacts
through Indirect Land Use Change (ILUC). "So, increasing the
ambition on that front is a good thing, although it may be
difficult for the market to meet," said Searle.
The series of advanced biofuel targets proposed would replace a
previous 0.5% advanced biofuels target for 2020, which many member
states did not meet.
Searle acknowledged that the new advanced biofuel targets would
mean changes for the biofuel industry. "The Commission is not
really trying to stimulate a 100% new industry, but a mostly new
industry and it's going to take really dramatic growth to reach
those targets by 2030," said Searle. "It depends on member states.
This is a directive, not a regulation, and member states have to
implement it. If member states implement it well, those targets can
be met. If member states don't implement it well, the targets will
be missed."
Searle supports a proposed 2.6% sub-target for Renewable Fuels
of Non-Biological Origin that includes renewable-power origin
liquids and gases, like hydrogen, that to date are not widely used
as fuel. The target excludes blue hydrogen, which is not usable for
compliance with any part of the RED proposals, said Searle.
Food-based biofuel crop cap a negative
No one disagrees with the idea that burning biofuels releases
less emissions than fossil fuels. In the case of biodiesel when
compared to diesel, it's 41% less.
The debate is around biofuels made from feedstocks that displace
agriculture such as food or animal-feed crops, which leads to the
clearing of forests that would otherwise be carbon sinks to grow
those crops. The EC
estimated that 51% of land used to grow biofuels for EU
consumption in 2018 was located in non-EU countries. EU centers of
biofuel production are in Romania, Poland, and France.
To deal with this ILUC issue in the proposal, a cap of 7% on
food-based biofuels like palm, rapeseed, and soy will be carried
over into the new target. The target existed under the previous RED
II and discourages the use of feedstocks like palm due to their
impact on forests in Indonesia and Malaysia.
Searle argues the proposed cap on food-based biofuels is bad for
the climate because while the cap would stay the same, it would
cover almost all transportation fuels, thus allowing for greater
volumes of food-based biofuels to be used. "It's not a great thing,
because we know food-based biofuels are linked with significant
land-use change emissions and many types of food-based biofuels are
actually worse for the climate compared to petroleum, and some of
the types of biodiesel in particular," said Searle.
The proposal also includes an exception for crops grown abroad
during the winter in Europe, so-called intermediate crops like
corn. "There is the risk that a very large amount of just
'business-as-usual' food-based biofuels could sneak in around the
7% cap as intermediate crops, and the issue is that with the large
13% target, there is more draw for these unsustainable pathways.
We've done the modeling recently, and we found that we'd actually
get significant GHG savings with a slightly lower target of 11%
because you'd have less of a draw for these unsustainable
pathways," said Searle.
The EC is aware of the problem and has made modest efforts to
solve it. It passed a 2019 Delegated Act to set out rules for
certification of low-ILUC-risk biofuels and planned to legislate
for the gradual phase-out of high ILUC-risk biofuels like palm oil
by 2030. In last year's renewable energy progress report, the EC lamented that
ILUC emissions "cannot be measured precisely."
The EC believes that voluntary programs certifying the
sustainability of biofuels, including 13 schemes already approved
under the RED, can be used to certify low-ILUC biofuels, although
they do not allow tracing from production facilities.
But in 2016, an investigation by the European Court of Auditors
found such schemes were "not
fully reliable" due to weak oversight. In June, the EC opened a consultation on new standards
that would apply to all voluntary schemes, acknowledging a
willingness to improve its biofuel sustainability framework.
Change on the horizon for biofuel, shipping, aviation
industries
Encouraging the greening-shy shipping industry to start using
biofuels, the EC's 14 July package included policies supporting
RED's renewable aims for the maritime sector.
Measures that boost biofuels' use in shipping include the
RefuelEU Maritime minimum lifecycle GHG reduction, bunker fuel
taxation in the Energy Tax Directive, and the inclusion of shipping
in the EU Emissions Trading System, IHS Markit analysts explained
in a recent presentation.
What is more, the advanced biofuel target in the RED will
contain a 1.2 multiplier, which will mean a "double counting" (more
or less) of ships' and planes' use of such fuels towards that
target. As a result, not only shipping but also the aviation sector
is expected to form a new large source
of demand for biofuels.
Umbrella network Transform! Europe released a statement decrying the land-use
effects of a "boom" of biofuel use by ships. But the RED aviation
proposals won favor with other campaigners.
The proposal denies crop-based biofuels with feedstocks such as
soy and rapeseed inclusion in the definition of sustainable
aviation fuels (SAFs) used to meet proposed aviation targets and
restricts their use for maritime fuel targets. "From an
environmental point of view, the targets in that [ReFuelEU
Aviation] regulation are really good, because it doesn't include
food-based biofuels," said Searle.
Waste biogas would only make a limited contribution to the
target because there are few CNG vehicles in use, she added.
Advanced biofuel cellulosic ethanol might be spurred, but
probably for use in sectors like aviation rather than for vehicles
because the EC wants to
phase out internal combustion engines in favor of battery
electric vehicles. "I expect we'll still see some growth in that
industry, but it may be limited now by the forecast for
transitioning all gasoline cars to electric vehicles …. Hopefully,
we will see significant growth in other types of cellulosic biofuel
technology that can produce drop-in fuels for diesel and jet fuel,"
Searle said.
Yet, concerns remain that the riddle of sustainable biofuel
supply must be solved by ill-prepared sectors.
The lack of harmonization between sustainability criteria for
aviation and shipping sectors bothers the biofuel trade body, the
European Biodiesel Board. "The Commission proposes different
sustainability regimes and limits on feedstocks for biodiesel in
the aviation and maritime proposals …. This would cause substantial
market disruptions, possibly decreasing overall sustainable fuel
use and imperiling European transport decarbonization efforts," it
said in a statement.
The European Waste-to-Advanced Biofuels Association is concerned
about aviation outbidding other sectors for limited biofuel
supplies. It said this would "completely" distort the market and
"divert more than half of feedstocks" towards aviation, undermining
climate mitigation efforts in the road and maritime sectors.
The EC's impact assessment for the policy concludes that bio-LNG
and biodiesel combined will meet the bulk of EU maritime energy
mix, but those prospective buyers are skeptical. Shipping sector trade bodies
have protested that the fuels are not yet widely available.
Posted 10 August 2021 by Cristina Brooks, Senior Journalist, Climate and Sustainability