Melanie Williams Consulting

+41 7882 27 219

Soft cap, low ILUC risk, recycled carbon: the new biofuel buzzwords

The need to decarbonise transport after the recent dire warning from the UN Intergovernmental Panel on Climate Change on the acceleration of climate change, has provided a new impetus to the discussion on biofuels. Liquid fuels for aviation and heavy-duty transport, which will be needed after other road transport has been electrified, are a key policy focus. Even though an agreed text for Europe’s next Renewable Energy Directive (RED II) was published in the summer, there is still plenty of discussion and lobbying about the detail, going on behind the scenes. 

Participants at the recent Argus Biofuels conference in London got the chance to discuss the latest news. Inevitably there was much talk about double counting feedstocks in RED II. It now seems accepted that the proposed cap on established waste materials like used cooking oil and tallow of 1.7% will be ‘soft’ rather than ‘hard’ so there will be room for individual countries to exceed it. However, governments will have less freedom than at present in other areas. They will not be able to grant double counting status to wastes unless they are explicitly described in the Directive. Some categories like food and timber waste are broad and allow scope to find new cost competitive feedstocks that are still within the category. Others, like straw, are very specific and provide less potential for the addition of variants. The list will be reviewed in early 2019 and every two years thereafter with the possibility of adding (but not removing) new types of biomass. 

There was a discussion about the definition of ‘development fuels’ in the UK and the future status of ‘recycled carbon’ fuels described in RED II. Recycled carbon fuels are those made from fossil waste such as end-of-life plastic or process off gases. The greenhouse gas intensity to be attributed to these fossil wastes is key to calculating the potential savings of any fuel made from them. This value is likely to be contentious. It can’t be zero, as that would equate waste fossil material with waste biomass, which is clearly incorrect. On the other hand, it should have a lower value than the corresponding virgin fossil material. This discussion must be set against the push in RED II to increase the greenhouse gas savings threshold of biofuels to 70%.

The treatment of palm oil is likely to be equally contentious. The European Commission is trying to be even-handed when it comes to palm oil for biofuels. It is unpopular with NGOs, the public and MEPs, which is irrational, as palm oil for European biofuels has the strictest sustainability criteria with no deforestation permitted for the past ten years.  Moves to remove palm oil from renewable incentives, or even ban its import altogether, have receded in the face of proposed retaliatory action by palm oil exporting countries. The new thinking is that all vegetable oils will in future be categorised by their risk of causing indirect land use change (ILUC). Low risk biofuels and bioliquids, regardless of type, will be favoured. The Commission is tasked with proposing criteria and implementing measures for low ILUC risk biofuels by February 2019. The acceptance of palm industry wastes for double counting is also set to change following criticism that European incentives for wastes are subsidising the palm industry. It seems strange then to remove one palm residue from the double counting list (palm fatty acid distillate, PFAD), just to replace it with another (palm oil mill effluent, POME).

From a sustainability point of view the move to focus more on maximising greenhouse gas savings and avoiding indirect land use change, rather than the crop or waste used as a feedstock, make sense. Now that regulators have recognised that biofuels have an important part to play in decarbonising aviation and heavy goods transport, and RED II is on course to be adopted, the mood in the industry is more positive. Lets hope that words lead to actions.

Published: 17 October 18

Back to news list