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MEPs Approve Proposals To Reduce Biofuels Emissions
Influential Environment Committee backs cap on crop-based fuels and moves to include indirect emissions in EU directives By Will Nichols 11 Jul 2013 EU parliamentarians have approved proposals to limit the contribution of conventional biofuels toward its green transport targets, in a move producers labelled “complex and ineffective”. MEPs in the influential Environment Committee (ENVI) voted 43-26 – with one abstention – to set a cap for fuels made from food crops at 5.5 per cent and include emissions arising from indirect land use change (ILUC) factors such as clearing of forests, wetlands or grasslands in the Renewable Energy Directive and the Fuel Quality Directive when calculating official emissions impacts. The commission had already proposed a five per cent cap, roughly equating to current levels, but the EU Industry, Research and Energy Committee (ITRE) said last month this should be raised to 6.5 per cent and recommended ILUC factors not be included until the methodology for measuring indirect emissions is more reliable . The cap is designed to accelerate the development of so-called second-generation biofuels, which derive from materials such as waste, agricultural residues or algae, which in theory do not compete with food production but have yet to reach industrial levels of production. The Committee approved proposals that such advanced biofuels should account for at least two per cent of overall consumption by 2020 and, to boost the market share of electric vehicles , electricity produced from renewable sources should also account for two per cent. Green groups have blamed biofuel production for rising food prices and point to a number of research papers that suggest ILUC emissions mean that some forms of biofuel, particular biodiesel made from palm or soybean oil, are worse for the environment than the petrol and diesel fuels they are designed to replace. However, producers argue the science around ILUC calculations is still in its infancy and that the EU should not undermine a £14bn industry on such a premise. Moreover, they argue there is a real threat the EU will not be able to meet its goal of using 10 per cent green energy in transport by 2020 by effectively ruling out 80 per cent of EU biofuels, and warn that by changing the goal posts the move could deter investors in next-generation fuels. Kåre Riis Nielsen, director of European affairs at Danish company Novozymes, which manufacturers enzymes for both first- and second-generation producers, branded the proposals “a complex and ineffective package”. He said the proposals in the ITRE report would be a better way of promoting the best performing biofuels while addressing ILUC issues in a “practical manner”. “Limiting the share of conventional biofuels to 5.5 per cent prevents further growth of the industry and ignores the strong contribution conventional ethanol makes to decarbonise the transport sector even when ILUC is accounted for,” Nielsen said in a statement. “The ENVI Committee has ignored the opinions provided by other Parliamentary Committees… that recommended a more balanced approach allowing conventional biofuels to develop sustainably while incentivising further innovative advanced biofuels. “Today’s vote fails to provide the needed long-term and stable policy framework for industry and investors and would jeopardise the future of best performing biofuels including advanced biofuels industry.” Kenneth Richter, biofuels campaigner at Friends of the Earth, gave the measures a cautious welcome, but argued that they represented a “timid step” when bolder action was required. “The introduction of ILUC factors is an important decision to ensure that only biofuels that benefit the climate are being supported,” he said. “But it’s disappointing that the committee has not set a trajectory for phasing out the use of food for fuel, but instead chose to cap it at a level that is even higher than current use. “It’s crucial that when the parliament’s plenary votes in September, it must not further water down the current proposal.” Giuseppe Nastasi of ClientEarth, was equally circumspect, arguing a five per cent cap is still too high to prevent ILUC emissions, “Moreover, MEPs voted to subsidise some advanced biofuels made from environmentally dangerous materials such as industrial and municipal waste (with the exception of a few waste streams), plus forestry and agricultural residues whose use endangers biodiversity and soil fertility,” he added. “This will have to be corrected by Parliament on 10th September.” However, Nusa Urbancic, clean fuels manager at campaign group Transport & Environment, said the proposals would promote the production of “genuinely emissions reducing transport fuels” including advanced biofuels and renewable electricity for electric vehicles. “It is encouraging to see that MEPs in charge of protecting our environment finally addressed the elephant in the room by fully accounting for indirect emissions in the EU biofuels policy. This vote will pave the way for truly sustainable transport fuels, which actually reduce emissions , as of 2020,” she said. “The full European Parliament now needs to uphold in September the science-based decision made by the Environment Committee. Otherwise, public support worth at least €10bn a year will continue to be wasted on harmful biofuels that in many cases pollute twice as much as conventional fuels.” Continue reading
US Steps Up Advanced Biofuels Support With $25m Funding
Algae biofuels producers win lion’s share of funding as United States’ first commercial-scale cellulosic biofuels plant opens in Florida By BusinessGreen staff 05 Aug 2013 The US government has awarded grants of over $22m to companies using algae and other biomass to produce fuel in the latest show of support for the nascent advanced biofuels sector. Hawaii Bioenergy, San Diego-based Sapphire Energy, and New Mexico State University will each receive $5m in Department of Energy funding to advance the development of algae-based fuels as a direct replacement for conventional fuels, while California Polytechnic State University was awarded $1.5m to cultivate more productive algae strains. In addition, FDC Enterprises was given $6m to improve processes for collecting and distributing wood, grass and agricultural waste that can be converted into fuel. [font=arial,helvetica,sans-serif] Announcing the funding last week, Energy Secretary Ernest Moniz said: “By partnering with industry and universities, we can help make clean, renewable biofuels cost-competitive with gasoline, give drivers more options at the pump and cut harmful carbon pollution.” [font=arial,helvetica,sans-serif] Currently, the US transportation sector accounts for two-thirds of the country’s total oil consumption and one-third of its greenhouse gas emissions. [font=arial,helvetica,sans-serif] The Obama administration has sought to bring forward the production of next generation fuels to insulate the country from oil price shocks and reduce its dependence on imports. It aims to produce cost-competitive drop-in biofuels by 2017 and algae biofuels by 2022. [font=arial,helvetica,sans-serif] As well as funding advanced biofuels producers, the US military has also jointly invested in plants to ensure there is sufficient supply of sustainable biofuels. [font=arial,helvetica,sans-serif] Cellulosic biofuels made from non-food feedstocks, waste materials and algae can directly replace petroleum fuels in vehicles and refineries and in theory do not pose the same challenges as first generation fuels made from crops such as wheat or corn. Campaigners have claimed industrial-scale production of biofuels can hinder food production, drive deforestation, and produce more emissions over their life cycle than fossil fuels. [font=arial,helvetica,sans-serif] However, advanced biofuels production still remains at relatively low levels, despite long-standing targets in the US, and the country’s first commercial-scale cellulosic ethanol plant only came online last week. [font=arial,helvetica,sans-serif] INEOS Bio’s Indian River BioEnergy Center in Vero Beach, Florida, a joint venture between INEOS Bio and New Planet Energy, is expected to convert wood scraps, grass clippings and other waste materials into eight million gallons (30.3 million litres) of transportation fuel a year, as well as 6MW of energy for heat and power. Continue reading
Are Subsidies for Bioenergy Necessary?
By Kolby Hoagland | August 02, 2013 When subsidies are discussed in the media there is often a negative connotation behind their assessment. Politicians face constant scrutiny for approving “government handouts” that are alleged to be unnecessary and wasteful. The bioenergy sector has numerous subsidies that it utilizes to better compete with the fossil fuel sector, which have a far longer run as mature industries and also receive considerable subsidies of their own . Today’s DataPoints looks at what happens when a subsidy is removed, reinstated… removed again, and reinstated again and that might give us insight into their need for the healthy growth of our industry. Over the last four years, the biodiesel industry has experienced an intermittently implamented $1 dollar per gallon blender’s tax credit from the federal government to that is meant to spark growth. In spite of the on again/ off again incentive, the biodiesel industry remains relatively healthy, even eclipsing the one billion gallons per year production mandate set by the EPA . The chart below shows monthly biodiesel production in the U.S. from Jan of 2009 to May of this year with the periods that the blender’s credit was allowed lapse. After the credit was first allowed to lapse in 2010, production decreased considerably and remained low. During the second lapse in 2012, production was up and down even reaching production milestones. There is not a clear trend on whether the subsidy is necessary from this simple analysis. To better understand the production swings and how much they were caused by the expiration of the subsidy, I reached out to Ron Kotrba from Biodiesel Magazine . Ron explained that 2010 was a complex time for biodiesel markets not only because of the lapse in the credit. The delayed implementation of RFS2, which did not occur until mid-2010, and the 2009 enactment of import tariffs by the EU caused further disruption to U.S. production beyond the loss of the federal credit during 2010. The reaction by producers to the loss of the credit in 2012 further supports the notion that the credit alone does not kill or keep the industry alive. During this second lapse of the credit in 2012, biodiesel production rose to record setting heights, peaking at 100 million gallons in May, a monthly level only reached three times previously. Production levels in 2010 and 2012, while the credit had lapsed, were not similar enough to draw illuminate conclusions of the potential need for the credit to keep the biodiesel industry alive. There is little doubt that the biodiesel blender’s $1 per gallon tax credit and other bioenergy subsidies spur production. Yet, whether the subsidy is needed for the survival of the industry is far more complex in its answer given the numerous influences on energy markets. However, if we look to the fossil fuel sector to help us anwer whether subsidies for bioenergy are necessary, the answer is inherently ‘yes,’ subsidies should be a permanent part of the funding structure for the long-term health and growth of the bioenergy industry. Continue reading
