• 10 years of failed fuels policies in Europe: how to break our oil addiction

    This summer will be a special one for Europeans. For the lucky ones who will be able to leave on holidays, two important questions will be how far to go and what means of transport to use at a time when the virus seems to be regaining strength. But if the crisis makes us think differently about the way we travel, does it also make us reflect on the type of energy we use to move around? 

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    The Covid crisis led to a drop in transport oil consumption of 35% (based on T&E’s analysis of EU data for April 2019 vs 2020). Kerosene and petrol consumption dropped very sharply but diesel – which is also used for trucks – saw demand reduce by just 25%. It is interesting that a near-complete stand still of the economy led to these kinds of demand cuts – this shows both the potential and limits of travel demand reduction for climate purposes. But, more importantly, it begs the question: what would it take to completely cut Europe’s addiction to oil imports?

    In 2018, 95% of the EU’s transport energy was still based on oil. Even if the EU’s transport oil consumption declined between 2007 and 2013 due to the recession and energy efficiency, it started to increase again in 2014 as the economy picked up and fuel economy gains started to flatline. According to a new report by Cambridge Econometrics, crude oil imports in 2018 were 8% higher than in 2014 and reached a record 96% in 2018, with the majority of oil imports (31%) coming from Russia. That same year, the EU spent €211 billion on crude oil imports, equivalent to €473 per EU citizen.

    Policies to incentivise the use of alternative fuels in the last 10 years have failed to reduce this dependence and drive sustainable alternatives. Cars and trucks in Europe mostly use biofuels as an alternative for oil. In 2018, the EU consumed 62% more biofuels than in 2009, and nearly 43 times more than in 2000, representing around 4% of EU transport energy. Most of these biofuels drive deforestation and destroy the habitats of wildlife on the brink of extinction such as orangutans. This is especially the case for rapeseed, sunflower, soy and palm oil, which are used to make ‘bio’-diesel. Their use to produce EU biodiesel has jumped by 46%, from 8 million tonnes in 2009 to 11.7 Mt in 2019. There is now more rapeseed oil and palm oil in our tanks than on our plates, making EU drivers the biggest consumers of palm oil in Europe.

    Sadly this means the carbon intensity of the fuels consumed in the EU has not improved. According to the EU’s environment agency, the EEA, in 2017 it was only 2.3% lower than in 2010, when taking into account the deforestation effects of biofuels. And that’s based on very conservative estimates of the land-use change effects of biofuels.

    So, after nearly two decades of EU climate policy, having burned millions of tonnes of edible oils and cereals in our tanks, we are more energy dependent than before and transport greenhouse gas emissions have been on the rise every year since 2014.

    Clearly there needs to be a paradigm shift in the way we look at the energy used in transport, and the European Green Deal is a great opportunity to put things on a cleaner track.

    What would it take for Europe to break free from its oil addiction?

    The EU green deal should once and for all end the EU’s reliance on biofuels as the main decarbonisation option for transport fuels. A future EU policy should force the oil industry to contribute to the clean energy transition through alternatives.This would require the phase-out of palm oil and soy biofuels as soon as possible and setting an end date for the use of all food-based biofuels. There should be a stronger role for renewable electricity in transport and incentives for this clean fuel should be at the center of future EU fuel policies. A recent EU strategy highlighted the importance of hydrogen as a transport fuel, but it is crucial that only renewables-based hydrogen gets support and that demand-side measures are put in place for sectors where direct electrification is not foreseeable, such as long-distance shipping and aviation.

    With the exception of aviation, a winning EU strategy should not bet on liquid fuel alternatives in the future – this would only delay the necessary transition away from oil. Instead, it should build on the key mobility shifts that the Covid crisis triggered. This means radically changing the way we move and work – for example, increasing bike lanes in cities. But it also means focusing incentives for zero-emission (preferably shared) vehicles and supporting alternative sources of clean energy which, unlike biofuels, do not maintain the EU’s addiction to oil.