• Telling fuel producers what’s needed is gaining acceptance

    Editorial by Jos Dings Slowly, slowly, recognition is rising that it makes more sense to set a climate obligation for fuel suppliers and let them figure out how to meet it in the most cost-effective way, than to prescribe a certain amount of biofuels with highly uncertain environmental effects.


    When the Commission floated the idea of this in January, a lot of opposition was expected. But the inherent good sense of the idea – in particular the fact that it concentrates on the end , not the means to the end – is helping the concept of a setting a lifecycle greenhouse gas standard for transport fuels gradually gain acceptance in Europe. Last month’s meeting of EU environment ministers saw a big majority of member states support the idea in principle. MEPs will soon vote, and they have a positive report from the rapporteur Dorette Corbey.

    Meanwhile across the Atlantic, California is working hard on implementing the governor’s executive order to establish a ‘low carbon fuel standard’, the Californian equivalent of Europe’s ‘Article 7a’ of the proposed new fuel quality directive which sets a greenhouse gas standard for transport fuels.

    Setting a climate obligation is not just more cost-effective than prescribing an amount of biofuels, it is also environmentally more effective and fairer. It does not just apply a sustainability requirement on biofuels, but also on petrol and diesel, which still constitute 98% of the transport fuel market. And if car makers have to make reduction efforts, it is difficult to justify why the oil industry should not do anything.

    Of course there are complications with such an innovative approach to transport fuels. The main worry is that the proposed 10% climate target might lead to even more biofuels than the, already high, 10% quantity target that EU leaders agreed in March. If this would happen, then it’s not acceptable as long as there are no sustainability guarantees about biofuels. But it would be wrong to ditch ‘Article 7a’ for that reason – it would be throwing the baby away with the bathwater (which is, by the way, exactly what the oil industry lobby wants). There are much more intelligent solutions to make sure that the transport fuel chain saves carbon without excessive reliance on biofuels, and it is good that most EU nations now realise this. The Parliament should follow.

    Another, more technical, worry is that an EU-wide carbon calculator is not yet ready. That could be quite simply resolved by inserting a clause in the directive that ensures a small-scale review of the target once the calculator has been agreed. Again, the worst response would be to ditch or postpone ‘Article 7a’ because that would also postpone the urgently needed signal to the industry that it will have to prepare for cuts in lifecycle emissions.

    A third complication is the need to develop WTO-compatible sustainability standards for biofuels. There is much talk of this in policy circles, but very few people are actually working on developing such standards. Again, just like with the carbon calculator, there is a worrying lack of leadership at the Commission.

    2008 will be a critical year. Will Europe manage to innovate its transport fuel policy or will it stick to the old-fashioned an increasingly controversial ‘biofuel prescription’ approach? We will work hard to turn the first scenario into reality.

    This news story is taken from the November 2007 edition of T&E Bulletin.