EU Parliament biofuels blunder could expose EU to over $5.6 billion a year in sanctions

Members of the European Parliament have voted to reject an EU regulation that would have seen soy biofuels no longer count as a renewable fuel by 2030. Soy bean cultivation is one of the world’s leading causes of deforestation and land clearance, says T&E.

The decision to reverse the regulation could now see the EU liable for over $5.6 billion a year in retaliation penalties from Indonesia and Malaysia for failing to meet a legal obligation to update its laws regarding deforestation-risk biofuels, according to a letter sent to MEPs from Energy Commissioner Dan Jorgensen.

The EU previously won a WTO trade dispute against Indonesia and Malaysia that allowed the EU to keep a phase out of palm oil biofuels - of which Indonesia and Malaysia are the world’s biggest producers - provided it took a scientific and consistent approach to what it considers high deforestation risk feedstocks. This condition will now not be met as a result of today’s vote, leaving the EU open to litigative action from these palm oil powerhouses.

Cian Delaney, biofuels campaigner at T&E, said: “This decision comes after relentless, targeted lobbying from the bioenergy and agriculture industries, so they can continue to use deforestation-driving soy to make biofuels. Soy is one of the world’s leading causes of deforestation and land clearance. Considering it as a sustainable alternative to fossil fuel is a gross underestimation of the impact its cultivation has on the environment, climate and food security.”

According to T&E research, land dedicated to soy cultivation in Brazil now exceeds most European countries, which has devastating effects on the Amazon rainforest and the Cerrado savannah.

T&E calls on national governments to prioritise science by preemptively phasing out soy from national targets, as is already the case in France, the Netherlands, Denmark, and Belgium.