Report

Biofuels in cars: A dead end for Europe

November 27, 2025

Allowing a biofuels loophole in the EU 2035 cars law would bring total European demand to 2-9 times what can be sustainably sourced, new T&E research finds.

Downloads

Summary: Why biofuels must not be allowed under the EU’s car CO2 regulation

The EU’s CO₂ regulation for cars is the backbone of Europe’s automotive climate and industrial policy and the key driver for the supply of zero-emission cars. Changing the law to allow biofuels would be a disaster – here’s why:

  • The shift from environmentally damaging crop-based biofuels to waste-based biofuels has maintained a high reliance on imports: Today, 60% of biofuels are imported from non-EU countries. For used cooking oil, >80% is imported.

  • Reliance on imports comes with growing concerns over fraud risks: Previous investigations by T&E strongly suggests that fraud is occurring. As demand from aviation and shipping grows and supply remains limited in Europe, dependency on imports will only grow, further increasing the risk and level of fraud.

  • The current EU biofuel mix is delivering limited to non-existent CO2 savings (only 20%-40% CO2e savings vs. fossil fuels on average), and potential waste oil fraud would erase any emissions savings achieved at all.

  • Limited biofuels can’t cover planes and ships, let alone cars: Allowing a biofuels loophole in the EU 2035 cars law would add 30% to aviation and shipping biofuel demand and bring total EU demand to 2-9 times what can be sustainably sourced.

  • Sustainable sources of waste feedstocks are extremely limited; e.g. a car running on animal fats would require the equivalent of 120 pigs a year while a car running on used cooking oil would need 25 kg of fries per day.

  • Allowing biofuels to count as CO2 neutral fuels would risk increasing 2050 emissions by up to 23%. Europe faces a decisive choice: to either lead the global BEV race or fall behind by diverting to false solutions.

Since 2009, EU policies promoting food-based biofuels as fossil-fuel alternatives have led to inefficient land use compared with solar power and EVs. Using farmland for fuel crops causes indirect land-use change such as deforestation, which undermines emissions benefits and increases pressure on food security

Breakdown of insights

Crop-based fuels are highly inefficient: the same land could power 90× more electric cars

Despite 15+ years of favourable policies: ~7% of total road fuel demand in 2024

A partial shift from crops to waste oils, but uptake limited

60% Percentage of biofuels imported from non-EU countries (used in IT, ES, DE, FR)

This shift has kept reliance on imports high

The EU has seen increased reliance on dubious imports, in particular from Asian countries

80% of UCO used in EU biofuels is imported

Alarming mismatches in UCO imports strongly suggesting fraud is occurring: In 2023, Malaysia exported three times more UCO that it can collect

As demand for waste oils grow and supplies remain limited, concerns increase over fraud risks

High increase of EU imports of POME, a residue from the processing of palm oil, reaching a quarter of EU hydrotreated vegetable oil (HVO) in 2023

Palm oil mill effluent, the new fraud scandal

9% Percentage of International Sustainability and Carbon Certification (ISCC)-certified UCO collectors in China, Malaysia, and Indonesia verified through an on-site audit

Weak biofuels certification schemes further undermine trust in imported biofuels

~60% Typical CO₂ savings of food and feed biofuels, compared to fossil fuels. But emissions can exceed that of fossil fuels when accounting for indirect emissions like deforestation (ILUC)

Biofuels, far from being climate neutral fuels

Many new 'advanced' biofuels require advanced technologies not yet fully commercialised and without strict sustainability safeguards, these could also cause negative environmental impacts

Novel ‘advanced’ biofuels can also bring sustainability risks

20% CO2 savings of bio-based diesel vs. fossil fuels

40% CO2 savings of bioethanol vs. fossil fuels

Current biofuel mix delivers limited to non-existent CO2 savings

20% of new cars running on advanced biofuels after 2035 could add 30% to the existing potential demand in 2050 from aviation and shipping

Allowing biofuels in new cars adds pressure on aviation, shipping, and existing car fleet

Policy recommendations

Opening a loophole for biofuels after 2035 would increase EU car emissions 

Allowing CO2 credits for biofuels could reduce BEV sales

Recommendations

  • 1

    Keep biofuels out of the cars CO2 regulation: The EU must reject options that include biofuels in the car CO2 regulation (as carbon correction factor or post-2035 exemption) to protect the integrity of the car CO2 regulation and broader climate policy framework. If exemptions for ‘CO2-neutral fuels’ post 2035 are considered, they should be strictly limited: 5% sales cap, limited to vehicles powered exclusively by 100% climate-neutral e-fuels, with no biofuels allowed.

  • 2

    Prioritise advanced biofuels for hard to abate sectors like aviation & shipping: Projected availability of sustainable biofuels will not even be enough to decarbonise ships and planes. Any biofuels going in new cars will increase reliance on fraud-prone imports and even fossil fuels use.

  • 3

    Maintain 2030–2035 car CO2 targets and tailpipe approach Fake alternative like biofuels lead to regulatory ambiguity, undermine company, investor and consumer confidence, and put jobs and EV momentum at risk.

Related Articles

View All