The EU Biofuels Chain supports the final objective of the sustainable finance Regulation: to enable financial flows to support sustainable growth and transition to a carbon neutral economy. We understand and support the principle that the EU taxonomy should not contradict the European Green Deal objectives to fully deliver on the increased EU climate ambition.
However, we wish to point towards legislative contradictions as well as underline the shortcomings of the process leading to the adoption of the draft delegated act.
1. The draft delegated act would contradict the sustainability criteria that have been agreed in the Renewable Energy Directive II (2018/2001), hereafter ‘RED II’, currently being implemented across Member States.
The proposed eligibility criteria are based on the TEG final report that has misinterpreted the sustainability criteria of biofuels in RED II and made the erroneous conclusion that only advanced biofuels are supported by RED II by stating: ‘Manufacture of Biomass, Biogas and Biofuels is eligible if:produced from the advanced feedstock listed in Part A of Annex IX of Directive (EU) 2018/2001’.
Discriminating between crop-based and advanced biofuels is not justified according to RED II
. The phase-out of policy support for crop-based biofuels in transport has been rejected by the co- legislators, first in the ‘ILUC Directive’ 2015/1513 and more recently in RED II. On the contrary, the co- legislators have renewed their support to all sustainable forms of biofuels:
- Sustainable biofuels, both crop-based and advanced ones, can count towards the obligation put on fuel suppliers to provide at least 14% of renewable energy in the transport sector by 2030;
- The contribution of crop-based biofuels shall be no more than one percentage point higher than their 2020 share, with a 7% maximum;
- RED II limits the phase-out of support to high indirect land-use change-risk feedstock for which significant expansion of the production into land with high-carbon stock is observed, as defined in the Commission Delegated Regulation and its annex;
- Advanced biofuels, defined as those made from Annex IX-A feedstock, are subject to a dedicated ramping-up sub-target, reaching 3.5% of the energy in transport by 2030. They enjoy an extra level of support.
Furthermore, excluding crop-based biofuels would go against the findings of the Commission Renewable Energy Progress Report
, which underlines that these biofuels have significantly contributed to CO2 emission reduction in the transport sector in 2018.
The European Commission
itself assumes that an even higher renewable energy share of 24% in transport is required to ensure that the transport sector contributes sufficiently to the 55% GHG saving target of the Green Deal. Taking into account that transport has the lowest share of renewable energy use, all sustainable transport fuels defined in RED II should be included in the EU taxonomy to ensure that sustainable finance fully contributes to the transition to a carbon neutral economy.
It would be inconsistent
to have the RED II legislation defining and supporting sustainable biofuels (including crop-based ones) and the sustainable finance policy excluding the same biofuels.
2. The draft delegated act makes a wrong use of the notion of “contributing substantially to climate change mitigation” and “transitional” activity as referred in Article 10(2) of Regulation (EU) 2020/852 with regard to the manufacturing of biofuels and biogas for transport.
- The TEG final report itself has pointed out that ‘for other types of biofuels that are not advanced biofuels but may offer substantial climate mitigation benefits’ and that the Platform for Sustainable Finance ‘will undertake further work to consider establishing criteria for ensuring substantial contribution to climate mitigation’.
- The delegated act, if it were to exclude other sustainable biofuels would go against the TEG final report and would annihilate the future work of the Platform for Sustainable Finance. It would be adequate to wait for the Platform for Sustainable Finance to work on eligibility criteria for other types of biofuels that are not advanced biofuels but offer substantial climate mitigation benefits, as is the case of European biofuels.
The manufacturing of biofuels and biogas for transport clearly belongs to the activities referred to the Article 10 (1):
3. In line with Article 290 TFEU “delegated acts are legally binding acts that enable the Commission to supplement or amend non-essential part of EU legislative acts, for example, in order to define detailed measures...”1. However, the exclusion of crop-based biofuels is a significant legislative change and would override a legislative act e.g. RED II, already adopted via ordinary legislative procedure.
- (c) increasing clean or climate-neutral mobility; and
- (h) producing clean and efficient fuelsTherefore, it should be considered as making a substantial contribution to climate change mitigation.As already mentioned above the European Commission itself assumes that an even higher renewable energy share of 24% in transport is required to ensure that the transport sector contributes sufficiently to the 55% GHG saving target of the Green Deal.The draft delegated act aims at identifying consistent criteria to demonstrate a substantial contribution to the environmental objectives. The principle should evaluate the technologies in a neutral approach. As far as mobility is concerned, the focus on promoting only tailpipe zero emission vehicles excludes artificially sustainable biofuel solutions. The mobility emission criterion should be based on life cycle analysis.
We regret that the elaboration process of a piece of legislation on such a crucial and complex matter has been restricted without providing real opportunity for the stakeholders from our sector to be heard and that the joint candidate put forward for the Sustainable Finance Platform by several bioenergy stakeholders was not selected.
We therefore believe that it is premature for the delegated act to restrict the scope of eligible biofuels in a way that is more restrictive than RED II.
Alignment with RED II on both feedstock inclusion and sustainability criteria should be sought for the following activities:
Download full article here
- - Manufacture of biogas and biofuels for use in transport (4.13)
- - Manufacture of organic basic chemicals (3.13)
- - Manufacture of plastic in primary form (3.16)
- - Electricity generation from bioenergy (4.8)
- - Transmission and distribution networks for renewable and low-carbon gases (4.14)
- - Cogeneration of heat/cool and power from bioenergy (4.20)
- - Production of heat/cool from bioenergy (4.24)
- - Anaerobic digestion of bio-waste (5.7).