Feature

Biofuels and the bureaucratic

beast
The EU is striving for a prosperous biofuels industry, while at the same time attempting to address
pressing issues such as sustainability, trade and fuel quality. Meghan Sapp investigates the implications of EU policy for industry and the future.
Published online in Wiley InterScience (www.interscience.wiley.com); DOI: 10.1002/bbb.56;
Biofuels, Bioprod. Bioref. 2:1215 (2008)
he European Unions biofuel industry has been
growing at a steady pace for the past several years
thanks to soft targets which will become mandatory
targets by 2020, yet the policies which are driving the market
have come to a crossroads.
Reaching 10% biofuel use in all 27 member states by 2020
is, on the surface, a clear target, but the EUs executive
branch the European Commission (the Commission) is
preparing to dole out a series of new proposals in the New
Year which producers are finding difficult to swallow. At
the same time the European Parliament (EP) seems to be
working on its own agenda that may not be in line with the
Commission.
Several new pieces of legislation are working their
way through the EU pipeline that will help to synergize
research and development in the field. The EU released its
Strategic Energy Technology Plan in November that seeks
to harmonize initiatives on energy policy and fi nd coherence. That, along with the renewable energy directive also
due out in January, is seen by industry as guiding legislation to help support Europes growing biofuel markets in
the years to come.

But coherence in energy policy, much less biofuel policy,

is a long way away. Among EU member states, there is no
coherence as to subsidy and support programs or market
drivers to get consumers demanding more biofuels at the
forecourt.

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2008 Society of Chemical Industry and John Wiley & Sons, Ltd

Biofuels directives are not being implemented as planned

in the member states and theyre not reaching their targets.
Thats a big disappointment and why theyre being revised,
Anamaria Bravo, Public Affairs Director for enzyme manufacturer Genencor told Biofpr. Everyone is nervous to see
what the way forward is.
But those who have been slow in catching up with the
biofuels race may have an opportunity to make the transition easier for themselves than those who came before.
According to Dr Lutz Guderjahn, Chief Operating Officer of
Germanys CropEnergies, those member states whom have
not implemented any measures to introduce biofuels might
adopt homogenized measures based on decisions made on a
European level from the very beginning instead of adopting
their own systems which would then have to be changed to
fit with EU regulations.
In general, mandatory systems seem to be superior to tax
incentives in order to catch up quickly, he says.
Theres plenty to catch up on as well, with many of the EUs
new member states and a handful of the old ones without a
drop of biofuels in their markets. Those who missed the 2%
target for 2005 and nearly all the member states who miss
the 5.75% target for 2010 will have to push hard to reach 10%
by 2020, though now with even more rules to follow that
may or may not make the way clearer.
As of 2005, the EUs 25 member states had reached an
average of 1% biofuel use with 8 member states having no

Feature: Biofuels and the bureaucratic beast

biofuel use at all. Only Sweden and Germany had biofuel use
above 1%.
In January, the long-awaited directive on biofuel sustainability will begin its arduous task through European legislative processes as the EU looks to find the right balance
between production and sustainability. One of the biggest
concerns is about how to guarantee that biofuels produced
in Europe save more carbon than they emit during the
production process.
Sustainability is not merely a matter of CO2 emissions,
but rather a combination of the CO2 avoidance potential
of a biofuel, of biodiversity and of changes in land use,
Dr Guderjahn told Biofpr.
In addition, sustainability also captures social and
economic aspects. Therefore, we need to avoid looking at the
CO2 avoidance as the only important factor which defines
sustainability when in reality it is just one of them, he said.
There needs to be a sensible system which balances sustainability, the security of energy supply, and the strengthening
of rural areas, which are the three most important reasons
for promoting a biofuels industry in Europe.
Non-governmental organizations have criticized the
Commission for limiting its sustainability criteria to environmental regulations rather than tackling wider issues
involved with labor and social sustainability. Much of that
concern is based on the likelihood of biofuel imports from
developing countries that the NGOs dont want to see
exploited. Yet the Commission has not found a way to tackle
non-environmental sustainability criteria without infringing
on World Trade Organization (WTO) rules, which is why its
sticking with the safest route.
Imports still account for the minority of biofuels used in
the EU, though as biofuel use mandates come into place
creating higher demand and biofuel exports from Least
Developed Countries increase as they take advantage of
duty-free, quota-free access to the European market, that
dynamic is likely to change.
Yet even limiting sustainability criteria to environmental
standards will put a halt to some potential biofuel imports.
Controversy over palm oil produced in Indonesia and
Malaysia where destruction of rainforests and peat bogs
has been ongoing for several years would be blocked by EU
standards should those exporters not be able to prove the

M Sapp

feedstock came from sustainable sources. The same goes for

Brazil, the worlds largest ethanol exporter, who is developing its own sustainability criteria to ensure that its exports
are not subject to non-trade barriers based on environmental
rules from third countries like the EU.
Sustainability criteria will likely come in the form of certificates where origins or producers be they inside or outside
the EU will have to prove that biofuels production follows
a strict set of guidelines. Questions have arisen in potential
exporter countries over how these certificates are going to be
managed and monitored, as well as whos going to pay for it.
In the end, certification requirements may become a burden
on developing countries and could risk being viewed as a
non-tariff trade barrier that will land the EU in trouble with
the WTO anyway.
Guderjahn says the Netherlands, the UK, and Germany
are all working on their own sustainability measurement
systems that will likely come into effect in 2008. So in order
to avoid having 27 separate systems with each country
relying on different criteria and calculations, he says that it
is essential the EU moves quickly and gets a comprehensive
system passed.
However, if there should be separate systems, the reciprocal acknowledgement and possibility of biofuels being
accepted in different systems is of great importance in order
to avoid market distortions within the EU, he says.
On top of 27 potentially different standards among
member states, the EP is taking it upon itself to establish
basic biofuel sustainability standards as well. The EPs environmental committee decided on November 27 to include
sustainability standards as part of its review of the Fuel
Quality Directive. The legislation is an update of the 1998
law that sets fuel quality standards for petrol, diesel and
other fuels used in most transportation within the EU. The
Commission proposed an updated directive in January and
the EP is currently having its turn with it.
The rapporteur for the fuel quality directive in the environmental committee, a Dutch socialist member of the
European Parliament (MEP), says that since the Commission
did not establish sustainability criteria before it set its 10%
use mandate but is instead doing it now, it is up to the EP to
make sure that measures meant to promote biofuel use do not
encourage biofuel production that harms the environment.

2008 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 2:1215 (2008); DOI: 10.1002/bbb

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M Sapp

Feature: Biofuels and the bureaucratic beast

Under the new criteria developed by the EP, only biofuels

that meet minimum biodiversity and social requirements
including avoiding deforestation, food price hikes and
water shortages and which are able to deliver lifecycle CO2
savings of at least 50% compared to fossil fuels, would count
towards the 10% target.
The addition of biofuels to the Fuel Quality Directive was
originally meant to encourage the auto industry to continue
developing cars that could run on higher blends of biofuels
by allowing those higher blends to be marketed at the forecourts. Up until now, all biofuels policy has been dealt with
in legislation directly linked to biofuels through energy,
biomass or agriculture. But now the EP has taken it further
than that, putting sustainability criteria into the same legislation as fuel standards in a move that many in the industry
find inappropriate and concerning.
While the sustainability criteria are important, they
should not be part of any fuel quality standard since this
should be concerned exclusively with the quality of the fuel
itself. The sustainability criteria are much better addressed
in the Renewable Energy Directive, says Guderjahn.
The entire EP is expected to vote on the Fuel Quality Directive on January 15 while the Commission is expected to
release the Renewable Energy Directive a week later.
One way to achieve those balances in sustainability is
through the use of new technologies to develop secondgeneration biofuels. European companies are working to
develop new processes that will lead to greater efficiency in
production, increase CO2 avoidance and reduce the need for
a conversation on food vs fuel.
Bravo says Genencor has recently launched its first
commercial enzyme product for cellulosic biofuel, Accellerase, which is meant to facilitate process development
and scale up the emerging biomass hydrolysis industry. But
the EU needs to commit itself politically to develop publicprivate partnerships to help speed up further commercial
development in cellulosic biofuels.
Were investing a lot in the enzymes that are so desperately
needed to develop second-generation biofuels. Everyone says
second-generation biofuels will help us reach the EUs goals,
so we need to develop public-private partnerships to help
industry develop these high investment technologies quickly,
she says.

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Theoretically these kinds of investment incentives and

support packages would come under the plans being developed through the recently released Strategic Energy Technology Plan but it is too soon to say what will fall under that
umbrella. It initially plans for the EC to invest 1 billion
between 2007 and 2013 in renewable energy technologies of
all kinds with approval expected during the Spring Council
in March 2008.
Bravo says that what is needed now is to develop integrated
technology packages for cellulosic ethanol. Proper pre-treatment technology needs to be identified so enzymes can
access the cellulose to break down, and then select the most
effective fermentation microbe that will convert the sugars
resulting from the enzyme treatment into ethanol. She says
there are different processes depending on what feedstock is
used so there needs to be different technologies developed to
work for each feedstock. From there, pilot and demonstration
plants need to be built.
We need in Europe a cohesive policy framework that will
overcome regulatory hurdles, give incentives to support the
market development, finance challenges to grow the market
and to get consumers to buy these products, said Bravo.
But that lack of cohesiveness continues to permeate itself
with the discrepancies between the Commission and the
EP. In many cases, opinions issued by the EP do not have
any legal weight, but in a few cases like the Fuel Quality
Directive, EP approval is required as part of the co-decision
procedure.
During the same committee vote in November, the environmental committee also removed a proposed waiver for
biofuels from vapor pressure standards so far only applicable
to petroleum products.
The Commission had originally proposed a waiver from
vapor pressure standards for fuels to allow up to 10%
ethanol. According to the Commission, These changes
will facilitate development of the biofuel market while
avoiding the possible risks of damage to existing vehicles.
Higher emissions of volatile organic compounds [VOCs]
will be controlled by collecting emissions in petrol stations
for all fuels.
The Commission says there are environmental risks
associated with higher ethanol and oxygenate content.
Higher oxygenate content can lead to higher NOx emissions

2008 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 2:1215 (2008); DOI: 10.1002/bbb

Feature: Biofuels and the bureaucratic beast

primarily from older vehicles. Increased ethanol content

risks higher VOC emissions because of reduced effectiveness of vehicle evaporative controls. Increasing ethanol
content above current levels also increases VOC permeation. A higher ethanol blend needs to have a lower vapor
pressure than conventional gasoline because of its nonlinear behavior if it is mixed with gasoline containing lower
ethanol content.
According to Guderjahn, a consequence of this would be
that the blending of ethanol would require a quality of gaso-

M Sapp

line adapted to vapor pressure and therefore more costly to

produce.
The waiver was removed because environmentalists feared
the waiver would lead to an increase of volatile organic
components. If the waiver is granted, ethanol could be
blended directly, but if no waiver is granted, the blending of
ethanol would require a different grade of gasoline, he said.
But, as Guderjahn says, until the legislation is adopted
by the EP and then the Council of all 27 energy ministers,
theres still an opportunity for the waiver to go back in.

2008 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 2:1215 (2008); DOI: 10.1002/bbb

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