Can the European Union Afford to Phase Out Conventional Biofuels?

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December 13, 2017

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by Michael Eggleston* (Advanced Biofuels USA) On November 7^th, 2017, industrial experts, leaders and policy makers alike met for the 20^th Annual World Ethanol & Biofuels Conference held in Brussels, Belgium to discuss how the future of de-fossilizing the transport sector might look.

Representing the interests of European renewable ethanol producers, Alcogroup’s CEO and ePURE’s Chairman, Charles-Albert Peers, said the policy “U-Turn” or revision of the Renewable Energy Directive (RED II) in Europe to phase out conventional, food-based biofuels, is killing off optimism for investors to support the scale up of second generation biofuels that utilize advanced technologies in converting non-competitive waste to fuel.

Leading by example, the European Union (EU) has set some of the most ambitious climate goals into motion; however, with talk of phasing out the diesel engine in some countries and the ongoing debate about the commission’s interest in phasing out conventional biofuels due to threat of competing for agricultural land in the world’s largest market for alternative liquid fuels, uncertainty among investors continues to grow.

Contrary to the European Commission’s initial RED II proposal, on November 28^th, the EU Parliament voted to increase targets for sustainable transport by using “sustainable” biofuels from 27% to 35% by 2030. This decision reassured flexibility within member states being allotted a 10% margin in meeting the overall target until 2025 at which time the Commission plans to step in to reinforce their goals if member states have not made sufficient progress.

This is planned to be achieved with biofuels and biogas that meet the Commission’s 50% greenhouse gas (GHG) emissions saving threshold excluding oil-based biodiesel such as palm-oil imports that have been linked to deforestation and human rights violations in the global south.

Despite the strong opinion against these imports, Indonesia and Malaysia, being the world’s top palm oil producers, and fearing the loss of their second largest consumer, are planning to try to convince policy makers to develop a market compromise.

The Parliament’s decision includes a sub-target of including 10% advanced biofuels, upped from the initial 6.8% proposal, in the transportation sector. Despite the optimistic step forward made by the Parliament, this decision clashes with the position adopted by the Parliament’s Committee on Environmental, Public Health and Food Safety (ENVI) earlier in October. This position called for phasing out crop-based biofuels, which currently make up the majority renewable energy contribution in the EU’s transportation sector, by 2030.

To make matters more complicated, some environmental non-governmental organizations (NGOs) are afraid that a higher sub-target of renewable energy for the transportation sector with a weak sustainability framework will drive consumption of crop-based biofuels since these crop-based biofuels are more affordable than those produce by waste feedstocks.

According to Raffaello Garofalo, the Secretary General for the European Biodiesel Board (EBB), in order for the change in policy to be “rational,” the Commission needs to investigate how much diesel is currently being consumed by the transportation sector if the EU is to drastically cut back the production of biofuels.

Although conventional biofuels are ready to be deployed, the industry has gotten a bad reputation for allegedly having an indirect land use change (ILUC) effect on global food production. Doug Berven, the Vice President of Corporate Affairs at POET, one of the world’s largest producers of ethanol based out of the United States, says that there is only a food AND fuel issue. A surplus of corn, wheat and soybeans can liberate the agriculture of other countries and serve to sustainably meet market demands, he explained. His presentation highlighted that the food vs. fuel argument is a common misconception which POET has discredited with its success in developing a sustainable network of biomass collection from local farmers who are producing a surplus to fuel their ethanol production.

According to Charles-Albert Peers, in order for advanced biofuels to sustainably replace fossil fuels, technology supporting competitive yield rates needs to be developed. He believes this can only be accomplished with the support of governments, through the implementation of improved blending mandates, and with the support of “big oil” through long term contracts. These will make biofuels cost competitive with petroleum he says.

Policy should be open to many possibilities and not be strictly confined to a list of prospects or generalizing technology if biofuels are expected to continue to develop into the market says Policy Planning Executive for ExxonMobil Petroleum & Chemical bvba, Khurram Gaba. Supporting the development of advanced biofuel technologies, the company is funding a broad portfolio of research programs related to algae and non-food based biomass feedstocks.

It was concluded by many delegates who had attended the conference that, in the long term, global policies should point towards a dual energy reality. “Green carbon” offers a sustainable way to fuel heavy transport as a geopolitical motive and “green electrons” will stabilize light transport. In the meantime, "green carbon" can also fuel light duty vehicles as the sustainable electric grid is still under development and it will take time to integrate solar, wind, geothermal and other renewable energy sources. Since the output of these technologies are subject to varying environmental conditions such as location, time of day and season they require the development of permanent energy storage.

Discussions at the conference explored that, logistically speaking, in the short or long term renewable liquid fuels are the only realistic solution to de-fossilize heavy transport vehicles such as trucks, ships and planes. This would be due to liquid fuels' high energy density complementing efforts to keep these vehicles' weight as light as possible.

The conference also highlighted that the most economical way to develop the future for renewable energy is to utilize the existing liquid fuel-friendly infrastructure that facilitates the transition to sustainable advanced biofuels. For example, in the United States, ethanol is blended at 10% or E10 in gasoline serving to replace methyl tert-butyl ether (MTBE) which was a more expensive octane source than ethanol and contributed to the pollution of ground water supplies.

A Capitol Hill policy briefing hosted by the Environmental and Energy Study Institute (EESI) highlighted how high-octane ethanol can optimize engine efficiency, how high octane/high ethanol blends can provide consumers with premium gasoline performance at a lower price than today’s regular gasoline.

In order to meet automakers' demands to facilitate reaching the EPA’s Corporate Average Fuel Economy (CAFE) Standards, Dean Drake, the President for Defour Group, LLC, recommends the implementation of a higher ethanol blend. He notes that is best achieved if there is wide support by stakeholders and clear communications to the public.

For an area in which the majority of the total renewable energy use in transport is attributed to biofuels, the EU would be at significant risk of failing to meet its renewable energy targets if biofuel targets do not continue to grow in the future. Overall, the softening of biofuel specific mandates in transport with a “cap” on conventional fuels will bring a significant additional burden to other transportation modes, says Raffaello Garofalo.

In conclusion, it was discussed that the transition to make advanced biofuels open to the market will become restricted without a sustainability criterion for conventional biofuel feedstocks that expands upon the Commission’s criteria of GHG reductions in place. Presenters pointed out that in order to have a smooth transition to advanced biofuels, reliable production of conventional biofuels is necessary in order to give investors confidence that there will be available markets and demand for more sustainable technologies.

RED II will be discussed further by member states on December 18^th when ministers are expected to reach their position and will go to a plenary vote on January 15^th, where negotiations will begin.

* Michael Eggleston is a chemical engineering student specializing in the interdisciplinary & intercultural communication of sustainable development practices with the University of Rhode Island’s International Engineering Program and spending a semester abroad at the Technische Universität Darmstadt in Darmstadt, Germany. He will be reporting on and representing Advanced Biofuels USA at international conferences.