Transport biofuels cap under scrutiny after renewable energy drop
The fall in the quantity of renewable energy used in the transport sector, which dipped under 10% thanks largely to a change in how statistics are calculated, shows that the cap placed on waste biofuels is “nonsensical”, industry has said.
Despite little change in practical terms, recent figures released by Eurostat, the EU’s statistics agency, show a steep fall in the quantity of renewable energy in the transport sector of some member states between 2020 and 2021.
The statistical drop is mainly due to applying a cap on second-generation biofuels made from used cooking oil (UCO) and certain animal fats.
While member states are free to use as much waste biofuels in their transport sector as they wish, it cannot be counted towards their renewable energy targets beyond a 1.7% share.
Biofuels derived from UCO and animal fats are considered a cost-effective means to displace fossil fuels from the road transport and maritime sectors, making them a popular choice to reduce transport emissions.
But as a result of the cap, the renewable energy share of countries that heavily relied on these biofuels was diminished.
Ireland, for example, saw its transport renewables share drop from 10.2% in 2020 to 4.3% in 2021. Hungary, similarly declined from a 11.6% share to 6.2%.
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The application of the cap has led to a “major misrepresentation of the renewable energy share in transport for several member states”, meaning that the statistics no longer reflect the reality on the ground, Leonidas Kanonis, director for communications and analysis at the European Waste-based & Advanced Biofuels Association (EWABA), told EURACTIV.
“This statistical effect makes no sense and shows yet another major flaw of the 1.7% limitation, further justifying its complete deletion from the text of the [Renewable Energy Directive],” he added.
The 1.7% cap on biofuels derived from feedstocks set out in part B of Annex IX of the Renewable Energy Directive was added by EU lawmakers mainly as a protection against fraud in the importation of UCO.
Questions have been raised over the providence of UCO imported into the bloc from Asia, with allegations that palm oil – which is restricted in the bloc for fuel – is being fraudulently passed off as UCO.
EU biofuel plan increases risk of fraudulent imports from Asia: study
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However, the biofuels industry has contested the cap, arguing that new EU measures to address traceability and sustainability make it redundant.
Dickon Posnett, director of corporate affairs with Argent Energy and board member of EWABA, told EURACTIV that mechanisms such as the Union Database for Biofuels, an EU-designed measure currently being implemented to improve the traceability of the biofuels supply chain, are better placed to address fraud than an arbitrary limitation.
“[The 1.7% cap] is more than redundant and archaic now, it is an obstacle to investment and decarbonisation,” he said.
“If you genuinely want to combat fraud, just saying we’re ok with ‘this’ much fraud is a weird way of doing it. It’s not typically a useful anti-fraud mechanism,” he added.
Posnett questioned the retention of the 1.7% cap whilst the EU simultaneously plans to expand the list of acceptable waste feedstocks for biofuel production, arguing that it sends the wrong signal for investment in the sector.
His sentiments were echoed by Harald Sigl, head of corporate communications & public affairs at Münzer Bioindustrie, an Austria-based biofuels company.
Sigl told EURACTIV that to treat an entire industry as though it is engaged in criminal fraud, and to place restrictions with this presumption, is “childish policymaking” and reiterated concerns that the cap slows needed investment in the sector.
“You will never get rid of criminal actions by capping the business model behind it. To pre-charge the whole industry of possible fraud, that’s unfair,” he said.
Sigl also argued that the collection of UCO for export from countries such as India and China prevents it from becoming “gutter oil”, in which UCO is illicitly collected from restaurant fryers, sewer drains, and grease traps to resell or use as new.
Gutter oil is often contaminated and can be dangerous to health if consumed.
He warned that while a lot more UCO from restaurants and home cooking could be gathered for conversion into fuel, “[the cap] decreases the motivation of the industry to invest in better, more efficient collecting solutions”.
However, in contrast to industry, green NGOs are typically in favour of the cap.
“To scrap the limit would give a major incentive to import even more used cooking oil, potentially even animal fats, taking it away from other markets and industries that also need them to decarbonise,” Barbara Smailagić, fuels policy officer at T&E, told EURACTIV.
The European Parliament and EU ministers are currently negotiating revisions to the Renewable Energy Directive, with the next, potentially final, round is scheduled for Wednesday (29 March). The outcome of these discussions will determine whether the 1.7% cap will remain part of the law.