Advanced Biofuels are key to decarbonizing transportation

In the EU, a number of directives regulate the use of biofuels, most prominently the “Renewable Energy Directive” (RED). On 30. November 2016, the European Commission presented a proposal for a revision of the Renewable Energy Directive (“RED II”) as part of its package “Clean Energy for All Europeans – unlocking Europe’s growth potential”. The title of this package implies its objectives: to reduce GHG emissions, create jobs and use cost-efficient solutions. The RED II plays into these goals: In June 2018, negotiators from the European Parliament, Council and Commission agreed on a binding renewable energy target of 32 % for the EU for 2030. The agreement also sets a target of 14 % for renewables in the transport sector by 2030. As the EU has recognized the significant role of advanced biofuels in decarbonizing transportation and meeting the goals set by the Paris Agreement, RED II sets ambitious targets for advanced biofuels. It creates a mandatory advanced biofuel blending mandate for all EU Member States starting at 0.2% in 2022, increasing to 1 % in 2025 and up to 3.5 % in 2030. It is up to the Member States to decide whether advanced biofuels will count double towards the fulfillment of these targets. The binding nature of this mandate creates a stable and predictable business environment that supports investments in advanced biofuel production within the EU.

What’s more, a report by the European Commission from March 2017 suggests that, with the fulfillment of the 3.5 % for advanced biofuels covered in RED II, lignocellulose-based biofuels can achieve over 30 Million tons of greenhouse gas savings per year. As a consequence, carbon-neutral advanced biofuels can contribute significantly to the decarbonization of the transport sector while at the same time providing a competitive and sustainable source of domestic renewable energy for the EU. This will have a hand in meeting the EU’s targets to reduce GHG emissions, ensuring the EU’s energy security and limiting its dependence on imported fossil fuels from outside the EU.

The RED II is the strong and stable framework investors have been requesting for years. It will enable large scale investments in sustainable and innovative technologies that will help the EU to combine economic growth with climate protection. In the coming months, the current version of the Directive still has to be approved formally by the European Parliament and the European Council. Once endorsed by both co-legislators, it is imperative that the updated Renewable Energy Directive is implemented by the Member States as soon as possible, in order to provide additional certainty and planning reliability to potential investors.