French court’s palm oil ruling a victory against ‘fake green fuels’

France’s highest court has said the government is entitled to withdraw tax incentives from fuel made with palm oil. The law was passed several months ago but was challenged by the French oil giant Total. The court rejected the challenge, saying the law was consistent with environmental protection.

For several years in the 2000s, the European Commission was keen to encourage biofuels, seeing them as a measure that could aid the fight against climate change while boosting the agriculture industry and energy security. A number of incentives were offered, and energy companies started investing in biofuels. But research has shown that not all biofuels reduce greenhouse gas emissions, and some increase them due to the indirect effects of clearing land to grow biofuel crops.

As part of the French government’s 2019 budget, tax exemptions on palm oil will end on 31 December, unless producers can show that it has been produced in a way that reduces the risk of indirect land use change. All other French tax exemptions from biofuels remain unaffected.

Total appealed to the French constitutional court, saying it had invested €300 million to convert its La Mède refinery in southern France from crude oil to biofuels in agreement with the government. But the court said ending palm oil’s exemption was justified ‘considering the strong growth of palm oil production and the major amount of land used for its production worldwide, and given the deforestation and drying out of peat bogs’.

T&E’s clean fuels director, Laura Buffet, said: ‘This is an important ruling because it affirms the Commission’s decision that palm oil diesel can be considered unsustainable and therefore should not be promoted, or qualify for tax breaks. We strongly urge other European countries to follow France’s lead and stop encouraging drivers to pay for “fake green fuels” that destroy the world’s rainforests and wildlife.’

France is not the first EU country to debate about ending the support to biofuels made from palm oil. In June 2019, the Dutch climate agreement committed to continue the ‘current practice in the Netherlands regarding exclusion of the use of biofuels produced from palm and soybean oil’.

According to the latest Commission study on deforestation and biofuels, 45% of global palm oil expansion has caused deforestation.

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