Transport Energy & Renewables in the EU – What the Latest Commission Data Tells Us

April 07, 2021

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by James Cogan (Ethanol Europe/Biofuels Digest) ... Oil maintains an overwhelming grip on the sector with a steady 94% share. The rest is biofuels with 5.6% and renewable electricity with 0.6%. Three quarters of the extra energy demand over the period was met by oil. 98% of renewables growth was biofuels.

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From a reporting perspective it is vital that the Commission ceases to include oil in its headline figures for transport renewables as they have a grossly distorting effect.

In the interest of fraud prevention and better policy making it should report countries of origin of biofuels, especially for used cooking oil. It should report biomass types and origins of crop biofuels, especially in the case of palm oil, and it should report biomass types and origins for advanced biofuels in order to allow policy makers track and modulate the effects of their regulation.

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Multipliers should be eliminated as they simply represent another form of climate action indulgence, while completely distorting member state policies and behaviours. The European Tax Directive reforms of 2015 should be voted through, and soon. Biogas – the sleeping beauty of European renewables – needs to expand dramatically.

The EU needs to further the contribution of sustainable European biofuels, which could easily double by 2030. Positive policies should be put in place to allow that happen. If anything should be capped it is oil consumption, not sustainable European biofuels.

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The multiplicators provision allows some renewables to be counted two or more times their actual values, when adding up the total, as an incentive for their development. It is not actual consumption of renewables that is reported.

The distortion is intensifying year on year, with fossil oil accounting for nearly 30% of the Commission’s reported renewables in 2019, up from 19% five years ago. Indeed there was bigger growth in oil classed as renewable by the Commission in 2019 than there was growth in actual renewable energy in the period. Oil labelled as renewable by DG Energy grew 70 times faster than genuine renewable electricity for instance.

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Used cooking oil biodiesel (UCO) is by far the biggest example of multiple counted energy, and far from being a niche player it has become a dominating element on the distortive effects of multipliers.

Used cooking oil biodiesel grew 35% last year across the EU28 according to the data, and averaged 44% annual growth since 2014. Consumption reached 4.1 billion litres in 2019, up from 517 million in 2014. While the UK, Germany and the Netherlands accounted for two thirds of total UCO demand in 2019, France, Ireland, Portugal and Spain accounted for another 20% between them. Ireland, Luxembourg, Malta and the Netherlands were the biggest per capita consumers of UCO diesel in 2019, with Ireland at 38 litres per person and Luxembourg at 60. These are large numbers if one considers that a country with a mature UCO collecting infrastructure will collect at most 4 or 5 litres per annum domestically while most countries in the world collect one litre or less per person, or quite commonly, none at all.

The majority of EU member states sought big increases in UCO utilisation last year, with the UK, Sweden, Spain, Ireland, Slovenia, Slovakia, the Netherlands, Hungary, France, Czechia and Croatia all participating in rapid expansion. Only Germany bucked the trend, with a 23% drop in UCO consumption.

The total amount of UCO consumed in EU biodiesel in 2019 was four times what is collected domestically from Europe’s catering sector. Hence the bulk of it is imported from jurisdictions where Europe has no powers to investigate or prosecute operators tempted into the fraudulent substitution of UCO with lower cost and readily available bulk palm oil.

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The volume of advanced biofuels in the renewables mix rose about 17% in 2019 to just over a million tonnes of oil equivalent, contributing 0.3% of Europe’s transport energy and 5.3% of renewable energy in the sector. Growth in advanced biofuels in 2019 was about seven times greater in absolute terms than growth in renewable electricity but it was three times lower than crop biofuels growth, five times lower than UCO, and eight times lower than the fossil oil counted as renewable by DG Energy under the multiplicators loophole.

Advanced biofuels are made from materials contained in a list compiled by DG Energy – loosely intended as residues and co-products from industry and agriculture – and have for the last decade been strongly promoted by DG Energy. In addition to being double-counted like UCO, there is an obligation on member states to raise consumption to 1.75% of their transport energy needs by 2030, or about six times current average rates. DG Energy has also provided around half a billion euros in grant aid to the sector in the last decade, in particular for the production of biofuels from materials such as straw, with limited results showing up in the Eurostat data thus far.

Over 90% of advanced biofuels are consumed in just five member states: Finland (36%), Sweden (23%), UK (21%), the Netherlands (8%) and France (4%). Indeed most member states use little or no advanced biofuels, making their targets for 2030 quite challenging.

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Crop biofuels are by far the largest category of renewables in the EU transport system, according to the data, accounting for a steady 3.5% of total transport energy over the past five years, and for around 60% of all renewable energy. In volume terms crop biofuels expanded 3% annually over the five year period, to reach 11.5 million tonnes of oil equivalent in 2019. The low growth in crop biofuels is attributable to the Commission’s decision to limit their role in renewable energy even though, in the case of domestically sourced crop biofuels, they are demonstrably better for the climate than increased use of oil, represent the lowest cost means of carbon emissions abatement and could be expanded with considerable benefits for Europe’s rural economy and food sector.

For such an important contributor to climate action in transport, to rural economic development and to protein feed security there is little detail in the data released by the Commission. There is no breakdown in the data to distinguish between domestically produced bioenergy and imports, or between the various types of biomass used.

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Just 1.6% of renewable bioenergy in the EU transport system in 2019 was contributed by biogas, coming to 279 thousand tonnes of oil equivalent, or 0.1% of all transport energy. Biogas development, though coming from a low base, was positive, with around a 45% annual increase over the five year period. According to the data, the seven countries involved were Sweden (39%), the UK (27%), Germany (20%) and the Netherlands (7%), with Denmark, Estonia and Finland accounting for another 6% between them in 2019. In the case of the Netherlands all of its transport biogas was delivered through the natural gas grid, whereas in the other six countries it was directly fuelled. Italy also uses biogas in its transport system, and has enacted major legislation to support biogas in transport, but has not yet provided consumption data for EUROSTAT.

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Renewable electricity in road transport in 2019 accounted for 0.03% of transport energy. This is up from 0.01% five years ago, but is still a low base and far from being a significant contributor to the 10% renewables target for 2020.

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Overall, renewable electricity in transport, including rail, has hovered around 0.6% of total transport energy over the five year period to 2020.

The data shows that renewable hydrogen and synthetic fuels have yet to make a contribution to the energy mix.

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To nudge things in the right direction in 2021 oil consumption, which is currently subject to no limits, should be capped, and ideally its share of transport energy should be cut by some obligatory portion each year, even if only a percent or two.

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References, endnotes

[i] https://ec.europa.eu/eurostat/web/energy/data/shares
[i] https://www.acea.be/statistics/article/size-distribution-of-the-vehicle-fleet
[i] https://www.ombudsman.europa.eu/en/case/en/57742
[i]https://www.gov.uk/government/statistics/renewable-fuel-statistics-2019-final-report; www.nora.ie/ READ MORE

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Tags

European Union (EU) Agricultural Policy environmental policy energy policy Transportation Fuels Policy fraud used cooking oil (UCO) palm oil energy crops Biofuel Crops Renewable Energy Directive (RED/RED II/RED III) oil tax policy cap-and-trade UK (United Kingdom) Germany Netherlands France Ireland Portugal Spain Luxembourg Malta Sweden Slovenia Slovakia Hungary Czech Republic Croatia import/export fossil fuel 2nd generation biofuels straw Advanced biofuels Agricultural waste/residue industrial waste grants Finland animal feed co-products Biogas Denmark Estonia Italy markets/sales Sustainability Malaysia Norway

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