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APPG for British Bioethanol Publishes Interim Report on E10 Inquiry

BioRefineries, Business News/Analysis, Feedstocks, Field/Orchard/Plantation Crops/Residues, Funding/Financing/Investing, Green Jobs, Opinions, Policy, R & D Focus, Sustainability, UK (United Kingdom)
June 12, 2019

(British Bioethanol)  Chair of the APPG for British Bioethanol Nic Dakin MP today launched the publication of the interim report into introduction of E10 in Westminster. … Interim recommendations:

  • Green solution needed to address increasing petrol usage in UK

  • Calls for DfT to host emergency summit on E10 before the summer

The APPG for British Bioethanol has today published its Interim Report, ending the first part of its Inquiry into Introducing E10 in the UK which launched in March. E10 is a blend of fuel containing ten percent bioethanol already sold in many other developed countries including Germany, Belgium, France, Finland and the US.

The publication of the Interim Report follows a call for Written Evidence and two Oral Evidence sessions hosted in the Palace of Westminster, which heard from a range of senior stakeholders from farmers to fuel producers. The Inquiry comes ahead of an anticipated announcement later this year by the Department for Transport on E10.

The Interim Report contains 9 Interim Findings including:

1. The UK economy will likely soon lose its Bioethanol industry – worth £1 Billion.

2. Introducing E10 would save the equivalent emissions of taking up to 700,000 cars off the road.

3. Petrol fuel sales volumes in the UK are increasing due to the diminishing popularity of diesel cars as well as a trend for bigger, less fuel efficient petrol cars like SUVs.

4. E10 could assist in addressing the UK’s serious air quality problems in short term.

5. If the British Bioethanol Industry is lost, the UK is unlikely to attract further international investment – including for the next generation of biofuels.

6. If the British Bioethanol Industry is lost, the UK will likely become dependent on increasingly scarce and less sustainable biofuel from abroad including Used Cooking Oil (UCO) from China.

7. If the British Bioethanol Industry is lost, British farmers will need to purchase an increasing volume of animal feed from less sustainable sources.

8. Without E10 it is more likely that the UK will miss its fuels quality directive target and the “buy out” cost avoidance even with E10 is estimated at £100 million – perhaps over double without E10 – and these costs are likely to be passed on to motorists in fuel prices at the forecourt.

9. Achieving the same GHG emission reduction (i.e.700,000 cars off the road) that E10 would bring through electric vehicles would have a very significant cost, including a one-off grant charge of £2.45 billion to the Government and recurring annual cost of £350 million to replace the lost fuel duty revenue. This would be in additional to the investment required to ensure the Grid could supply sufficient green electricity and other infrastructure investments including charging points.

On the launch of the Interim Report, Chair of the APPG Nic Dakin MP said:

“Our Inquiry has heard there are in fact increasing numbers of petrol cars on UK roads, and these cars are getting bigger and increasingly less fuel efficient on average. With mass adoption of pure electric cars decades away and the decreasing popularity of diesel, increasing volumes of petrol are being sold.

“With an urgent need to address the causes of climate change, improve air quality and support job creation in emerging green industries, practical measures which make petrol cars cleaner and greener must be a top priority for the Government who must now work to mandate the introduction of E10 in the UK by 2020 at the latest.”  READ MORE

Inquiry on the Introduction of E10 in the UK: An interim report by the APPG for British Bioethanol – June 2019  (British Bioethanol)

REA: Bioenergy needed to meet net-zero GHG goals (Biomass Magazine)

APPG for British Bioethanol: UK economy risks losing £1 billion bioethanol industry (Biofuels International)

 

Excerpt from British Bioethanol:  The current state of affairs is as baffling as it is frustrating. The Government has for years stated its ambition to achieve 10% renewable fuels in transport, with the bioethanol industry and investors alike reasonably predicting that this ambition would promptly lead to the UK adopting a doubling of the amount of bioethanol which is blended with petrol available at the pumps – moving from E5 to E10 – especially given the success of this policy in many developed nations throughout the EU and the rest of the world. Why then has the Government not progressed this policy after years of endless deliberation, delays and disappointment?

INTERIM RECOMMENDATIONS
1. The DfT should publish its response to its own consultation on E10 which closed in September 2018 without further delay.
2. The Secretary of State for Transport should host an emergency summit on the future of the British Bioethanol Industry, bringing together all relevant stakeholders before the Summer Parliamentary recess. This is needed in order to quickly agree the most efficient, transparent and cost effective way E10 could be introduced in the UK by 2020 to safeguard this industry, realise the many economic and environmental benefits it would deliver, and avoid potentially adding millions of pounds to motorist’s fuel bills. 

A further issue is the ‘crop cap’ placed upon the RTFO, which has served to suppress the market by placing a 4% limit for the amount of crop-derived biofuels which may be counted under a Member State’s transport target. Despite calls for it to be increased at least since 2013, the government in 2017 decided to introduce a year-on reduction starting in 2020, stopping at 2% by 2032. News of this was met with disappointment by the bioethanol industry.

Additionally, the greenhouse gas (GHG) reduction requirement for fuels which is currently set at 4% in 2019 and is set to rise to 6% in 2020 adds further risk for both the Government and motorists. In its written submission, Ensus stated that achieving this target with B7 Biodiesel and E5 Bioethanol appears to be impossible without the availability of Upstream Emission Reductions (UER’s) with no UER’s having been approved or certified at that date of their
submission.

The implications for fuel suppliers means that “buy out” of the obligation becomes a likelihood, freeing the obligated oil retailers to comply with GHG reduction at the pump. In the written submission from Ensus, the “buy out” is estimated to be approximately £250,000,000 per annum. Introducing E10 would likely reduce this amount by approximately £100,000,000. To meet the 6% GHG target without UER’s would require higher blends of ethanol / biodiesel (E20/E85/B30) and or fast uptake of alternative fuel vehicles (e.g. bio methane, hydrogen).

It is occasionally argued that by using wheat in the production process of E10, the British bioethanol industry is depriving the nation of food. In fact, it can be argued that the bioethanol industry actually helps strengthen food security in the United Kingdom. Feed grade wheat is used in the production of E10 – this wheat is completely different to milling grade wheat, which is used in the making of bread and other core food products. 60% of this feed grade wheat that is processed is used to make E10. The other 40% is protein, which is converted into high-protein
animal feed, is then put back into the hands of farmers.

These concerns are further levied by information taken from the NFU’s written evidence, which shows that 47% of all wheat produced in the UK was actually of this ‘feed’ grade. Ensus concurs; by creating a UK demand for surplus feed wheat, reliance on the volatile global market is dampened and farmers would then be able to mitigate risks and plan effectively for crop rotations.

The NFU also highlighted that climatically, the north of England is not suited to the production of wheat for human consumption, which is largely concentrated in the dryer parts of the UK. Therefore, the feedstock for bioethanol is not in direct competition with food production. In addition, the area remains small and will remain small due to The European Union Renewable Energy Directive II (RED II) which sets out the legal requirements for ILUC and limits the area of agricultural land in the EU that can be used to cultivate energy crops at 4% from 2020 falling gradually to 2% in 2032.     READ MORE

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