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The EU’s new deal on renewables... and the next big challenge

16/08/2018

Agreement on biofuels policy for 2020-2030 period shifts challenge to national level

By Emmanuel Desplechin

After a year and half of debate and negotiations, the European Union institutions in mid-June finally hammered out an agreement on renewable energy policy for the post-2020 period – setting a high target for renewables in transport and leaving room for sustainable biofuels like European ethanol to contribute to the fight against climate change.

The deal reached by the European Parliament, Council and Commission sets a target of 14% renewables in transport by 2030. It would freeze the use of high-ILUC-risk biofuels such as palm oil at current levels and phase it out by 2030, while capping crop-based biofuels at Member States’ 2020 levels, with a maximum of 7%. The agreement also sets an ambitious and much-needed target for advanced biofuels.

Significantly, the deal clearly recognises the importance of separating bad biofuels like palm oil from good ones like European ethanol.

Europe needs all sustainable renewables in the energy transition to achieve Europe’s climate goals. and EU ethanol – which in 2017 delivered more than 70% average greenhouse gas savings compared to fossil fuels – is critical to transport decarbonisation.

Of course, this is not a perfect solution. It poses a challenge for EU Member States, which will have to do their homework to meet these ambitious targets. The question now is how will they meet them: with artificial multipliers for certain renewables or with renewables that deliver real results.

Allowing Member States to undermine their transport targets by lowering the crop cap or relying on artificial multipliers gives the illusion of progress and puts Europe’s commitment to decarbonising transport into question.

Capping crop-based biofuels at 2020 levels also unfairly penalizes sustainable biofuels like European ethanol, which if given the chance could drive EU decarbonisation even further – but it is a major improvement over the initial proposal from the Commission, which would have almost completely phased out crop-based biofuels.

It will be important for EU Member States to push as far as they can before 2020 in setting a high cap for crop-based biofuels, and show that Europe is a place that can provide the policy stability investors need. A solid crop-based ethanol industry is needed to spur investment in advanced ethanol.

This will set the stage for delivering on the next big policy initiative for the EU: the Clean Mobility Package, which aims to reduce greenhouse gas emissions and pollutants from transport in the coming decades.

At the moment that debate is heavily focused on electric vehicles, but a new study from Ricardo Energy & Environment confirms that, with a large number of vehicles with internal combustion engines still on the road in coming decades, low-carbon fuels such as renewable ethanol will be crucial to decarbonising transport.

European ethanol, which keeps improving its greenhouse-gas-reducing performance year after year, is a clean mobility solution that already delivers results. The only question is whether it will be given the chance to do more.

 

The article was initially published in the Biofuels International July/August 2018 issue. You can read it here for free.