EU proposals on Indirect Land Use Change (COM (2012) 595) of 17 October 2012 Effects on the UK’s ability to reach the 10% renewable transport target

EU proposals on Indirect Land Use Change (COM (2012) 595) of 17 October 2012

Effects on the UK’s ability to reach the 10% renewable transport target

Clare WennerHead of Renewable TransportRenewable Energy Association

The sole responsibility for the content of this presentation lies with the authors. It does not necessarily reflect the opinion of the European Union. Neither the EACI nor the European Commission are responsible for any use that may be made of the information contained therein.

The Rise and Fall of Biofuels

BP, ABF & DuPont announce 330,000kt bioethanol plant in Hull26 June 2007

The Rise and Fall of Biofuels

The Rise and Fall of Biofuels

10%

The Rise and Fall of Biofuels

What was going on?

Climate Change

Transport1990 – transport = 18% of UK greenhouse gas emissions

2011 – transport = 26% of UK greenhouse gas emissions

NGO Campaigning

“Battles over Biofuels in Europe: NGOs and the Politics of Markets”

University of Essex – Published 5 August 2010

“We found that in many cases the development of NGO policy has been driven more by narrow political

opportunities for influence than by broader and more coherent policy responses to global climate change or

economic development, or indeed rigorous assessment of the scientific evidence.””

Carbon and Sustainability Rules“In December 2011, the RTFO order was amended to implement the sustainability criteria of the Renewable Energy Directive (RED). This introduced mandatory sustainability criteria which biofuels must meet for those fuels to be eligible for renewable transport fuel certificates.”

Department for Transport

The UK Industry Responded

• GHG savings from biofuels MADE in the UK 2011/2012 = 77%

• Jobs = 3,500

The UK Industry Responded

• Production = 192 million litres

= 12% UK market

• Investment = £1 billion

The UK Industry Responded

• Food AND Fuel = • 850,000 tonnes high

protein animal feed

• For every tonne of grain – 50-75% is returned to the food chain

• Replaces soy imports e.g. from South America

• Major contribution to reversing the protein deficit

The Moving Political Goalposts

• Reduction in transport greenhouse gas emissions to …….

• Food prices

• Land grab

The ILUC Proposals• Formal - response to Article 19(6) of the RED –

the impact of ILUC on greenhouse gas emissions, and safeguards for investment

• Informal – response to relentless anti-biofuels lobbying – self-interest motivation by many sectors

• Transport sector is the EU’s carbon “basket case”

• Spotlight on biofuels – why?

RED – key proposals • 5% cap on crop-based biofuels with immediate

effect – i.e. half the original 10% market• Aspiration only – no further support post-2020• Balance to be made up by “waste and residue”

biofuels, with x2 or x4 benefit• ILUC factors to be reported to the Commission

FQD – key proposals

• ILUC factors to be reported to the Commission

• NO 5% cap for crop-based biofuels• NO x2 or x4 benefit for “waste and residues”

biofuels

Inconsistent with proposals for RED = confusion

Effects of – 5% cap• Ignores high GHG saving of some “conventional” biofuels

• Spurious rationale in EM to “conventional biofuels (with a risk of ILUC emissions)”

• Ignores high protein animal feed co-product benefit of conventional feedstocks• But gives x 2 benefit to energy crops with no co-product benefit

Fatal blow to the UK’s ability to reach the RED target

Effects of – 5% cap and no support post-2020

MarketReduction in market size by 30-40%:• Future advanced biofuels investors• Current investment - £1 billion – Article

19(6) assurance?• 3,500 jobs now and in future• UK bioethanol industry

Effects of – 5% cap and no support post-2020

Agricultural productivityFood production – farmers respond

to marketsAnimal feed co-products that

replace imported soyUK export earnings

Agriculture

Effects of – x2 and x4Not the best way to incentivise advanced biofuelsIncreased use of fossil fuels and GHG emissions – illogicalTogether with 5% cap will have limited impact - reduce investor confidenceGreat incentive for fraud

Need commitment to at least 2030

Effects of – ILUC factors

• Uncertain science Flawed models Outside industry control Inappropriate basis for policy Inconsistent with other land-based sectors

Needs alot more work

Amend the proposals like this…

2% “carve-out” for advanced biofuels – feedstocks such as municipal and industrial waste and algae – no need for X4

Balance from UCO/tallow (x2), electric vehicles (x2.5) and conventional

No ILUC factors without solid science Renewable target for 2030 Harmonised fraud prevention

A few concluding thoughts Global demand for meat increased demand for soybean

protein land use change. Biofuels?? Europe cereal production . Europe agricultural land use

. Biofuels?? UK electric vehicles sales 2011 = 16,000 UK vehicle parc = 37 million – internal combustion engine = liquid fuel Fuel security, rising oil prices, political uncertainty,

exchange rate uncertaintyDecision on “Indirect Land use Change” crucial –should be science-based and take into account the TOTAL public good

•

THANK [email protected]

OPEN TO DISCUSSION

Where you can help – Targets post 2020

• a decarbonisation without renewable energy targets option, relying on the carbon market and a revised ETS

• continuation of the current regime, with binding renewable energy, emissions reductions and energy efficiency targets, or

• an enhanced, more harmonised management of our whole energy sector with an EU renewable energy target

Where you can help continued

• Support UK approach to how to define End of Waste, as this will not undermine UK’s Biofertiliser Certification Scheme

• Support UK stance on maintaining lower VAT rate on energy efficiency and micro-renewables equipment

• Your support for our ILUC recommendations