RED II likely to be adopted by November: lead MEP

Producers and traders of biofuels will likely have to wait until November to find out what caps the EU will place on using first generation biofuels, the European Parliament’s lead MEP on the file told an industry conference on Monday, saying flagship EU policy to revise its renewable energy targets, including those in transport, will take months to finalise.

Speaking to delegates at the Fuels Of The Future conference in Berlin, Dutch Green-Left MEP Bas Eickhout, who will negotiate on behalf of the Parliament with the EU Council to draft amendments to the Renewable Energy Directive, said last week’s Parliament vote to cap the use of crop-based biofuels at 2017 levels will probably require at least 10 months of trialogue discussions before it is adopted as EU law.

“The end deal will be a compromise,” said Eickhout, who added that he expects the deal to be finalised around the time of UN climate summit in Katowice, Poland in November. 

The EU lawmaker said the final law is likely to cap the use of crop-based biofuels as a percentage of total fuel consumed at a level between the 2017 figure (which can only be estimated at this stage because much of the available data hasn’t been published yet) and the 7% that was agreed by the European Council in December.

The current EU-wide share of crop-based biofuels used as a share of overall transport fuels is estimated to be around 4%, a proportion that the industry had hoped would increase as part of the EU’s moves to implement an overall 2030 renewable energy target that is likely to be 27%-35%.

The European biofuels industry won’t know for much of this year how much crop-based biofuels they can supply to help the EU meet its 2030 target to source 12-14% of its energy in transportation from renewables.

But Eickhout told the industry event that the direction of EU policymaking is “now very clear”.

“What the 2017 cap is saying is that is that is no increase for the crop-based biofuels industry in Europe,” Eickhout said, adding that the plenary’s vote last week was a “starting position” for negotiations in trialogue with the Bulgarian and Austrian six-month presidencies of the EU in 2018.

Waste

Manufacturers of crop-based biofuels are having to contemplate a regulatory framework in the 2021-2030 period that will allocate a higher share of the renewable energy target to advanced biofuels such as used cooking oil and the use of crop residues.

And although the industry is likely to benefit from a likely ban on imported feedstocks such as palm oil, EU biofuels producers will also have to contend with a potentially higher share in the transport renewables target for electric vehicles and biofuels generated through industrial processes.

Marijana Petir, an MEP with the centre-right European People’s Party grouping in the European Parliament, amplified a key concern that has become a regular refrain among producers of crop-based biofuels – that advanced biofuels have yet to be clearly defined.

Joachim Lutz, the CEO of CropEnergies, one of the EU’s largest biofuels producers, said in a Q&A at the Berlin conference that much of the industry would find the regulatory shift towards advanced biofuels as “very expensive” that would appear risky to many investors.

Elmar Baumann, the head of German biofuels industry organisation VDB, said that although some of his members had the capability to shift towards advanced biofuels they may be reluctant to invest because the payback on new equipment may be too long to satisfy lenders.

The question that individual member states will need to answer is to what extent they are prepared to offer subsidies and a beneficial tax regime to advanced biofuels, additives that have struggled to demonstrate strong annual production increases despite requirements to meet a 10% share of biofuels in by 2020 through RED I. 

What is clear from the proposals though, is each member state will be allowed to develop their own policy and measures to meet targets to boost renewable energy in transport, which could be as high as 14% for each member state by 2030.

"There won't be a common policy on this," said Eickhout, saying there was no appetite among member states to have an EU-wide policy.