In 2021, the European Union&rsquo;s current emissions reduction goal of 40% by 2030 in its Green Deal is slated to be bumped up to 55% by 2030. Within the sectors regulated to achieve that goal is, of course, transport, where hardly any decarbonization has taken place, according to Emmanuel Desplechin, secretary general of ePure, the European renewables association. &ldquo;I&rsquo;d even go further and say it&rsquo;s the only sector where emissions have actually increased.
&ldquo;Given the weight of the transport sector and the total EU emissions, transport really has to step up and contribute now.&rdquo;
The Renewable Energy Directive II outlines the regulations for emissions reduction in EU transport. Currently, the EU draws 6% of energy in transport from renewables, with a goal to increase that to 24%, Desplechin says. Biofuels now account for 90% of the renewables in transport, he adds. &ldquo;That&rsquo;s the harsh reality, despite the good intentions in electromobility and hydrogen.&rdquo;
With goals to step up electromobility, hydrogen and second-generation ethanol technologies, the RED II caps crop-based biofuels at 7%. Desplechin and others say the cap is unwarranted and hinders progress toward the EU&rsquo;s goals. &ldquo;We can&rsquo;t afford to pick one technology with innovative solutions such as hydrogen or electromobility,&rdquo; Desplechin says. &ldquo;We just need to build the case for renewables, and grow the biofuels share as well.
&ldquo;Our view is the cap on European ethanol is not justified and should be adjusted to reflect our potential for decarbonizing transport systems.&rdquo;
Currently, renewable electricity in transport in the world is only 0.3% of energy consumed, he cites. Politics at Play The 7% cap is a political answer to concerns about the sustainability of biofuels, Desplechin says, particularly land-use exchange regarding deforestation. &nbsp;
Land-use calculation is murky, so the EU abandoned it, says Candice Wilson, manager of ethanol trade policy and economics for the U.S. Grains Council. A corn ethanol plant in the EU will have a significantly higher greenhouse gas reduction than a plant in the U.S. because land-use is not taken into account, she adds.
The cap clearly illustrates the intention to skip first-generation ethanol and jump immediately to second-generation, says Ed Hubbard, general counsel for the Renewable Fuels Association. &ldquo;The focus has always been skipping the first generation, going right to the second generation and not using any sort of food-based crops.&rdquo; The challenge is the second generation hasn&rsquo;t taken off, he adds.
&ldquo;They&rsquo;re hamstringing their efforts by doing that, closing the door to what&rsquo;s available in the market now and creating their own obstacle to biofuel development and use,&rdquo; Hubbard says. &ldquo;We&rsquo;ve learned that first generation begets the second generation, second generation begets the third. There are certain costs and infrastructure buildouts that you get from the first generation that benefit the second generation.&rdquo;
Those investments and buildouts are done over a period of time, he says. &ldquo;They&rsquo;re cutting themselves out of future business, not just in U.S.-based ethanol, but just biofuels in general.&rdquo; Wilson agrees. &ldquo;By eliminating crop-based biofuels as an option to help them meet those targets, we see that as taking a solution off the table. You should use all tools in the toolbox.
&ldquo;A lot of countries, when trying to identify environmental solutions and mitigation of GHG emissions, I think that they kind of shoot for the stars and end up on the moon, so to speak,&rdquo; Wilson adds. &ldquo;For the longest time, many countries saw cellulosic ethanol as the solution to our transport emission problems. A lot of people are finally coming to terms with understanding that there&rsquo;s a lot of technical problems with cellulosic ethanol and it&rsquo;s not commercially viable because it&rsquo;s not an economically sound solution.&nbsp; &nbsp;
&ldquo;We&rsquo;re hoping we can work with members in the EU so we can all come to a consensus that there is no silver bullet, and we believe first-generation ethanol should be a part of the solution.&rdquo;
Desplechin says, &ldquo;Our view is that we need to maximize all carbon reductions in transport, ethanol being one of them.
&ldquo;Most cars will remain petrol for decades to come, some hybrid. They&rsquo;ll be running on liquid fuels, and ethanol is a way to lower the carbon intensity of these fuels.&rdquo;
In 2019, EU ethanol use resulted in a 72% GHG reduction over fossil fuels, on a steady climb since a 50% reduction in 2011, Desplechin says. EU refineries are implementing carbon capture, increasing efficiency and some are seeing up to 90% GHG reductions individually, he says.
&ldquo;Concretely speaking, what we need to do is roll out fully E10 across the EU 27 members states and then move towards higher blends.&rdquo; Thirteen Member States have E10 directives now, he says.
Desplechin adds that E10 is the current limit in petrol, but E85 is not considered petrol and is booming in France. The country saw an average of one E85 station opening every day last year. US Exports U.S. exports to the EU in 2019 (about 134 million gallons) increased by more than 200% over 2018, Desplechin says.
The 7% cap hasn&rsquo;t significantly affected U.S. ethanol exports to the EU for several reasons Wilson and Hubbard cite. First, the EU has a high duty on ethanol imports, even after the antidumping duties were lifted in 2019. But during that antidumping era, many U.S. plants let their EU export certifications expire and haven&rsquo;t recertified because of the cost and the number of other promising global markets. &ldquo;Producers said, &lsquo;We can let that one go,&rsquo;&rdquo; Hubbard says.
In the 2018-&rsquo;19 marketing year, only two ethanol plants were certified for EU export, Wilson says. &ldquo;Anti-dumping duty on U.S. ethanol imports in addition to the increasingly stringent regulations within the EU, has disincentivized U.S. producers from participating in this market,&rdquo; she says. &ldquo;At this time, the EU&rsquo;s certification scheme poses the single greatest market access barrier to U.S. ethanol exports.&rdquo;
Hubbard says, &ldquo;There was a period of time that the EU represented a third of the U.S. market. Between Brazil, Canada and the EU, that was the lions&rsquo; share of what we exported.&rdquo; Antidumping led exporters to focus on other markets, he says.
The EU also relies heavily on biodiesel in its renewables, Hubbard adds. &ldquo;There are a lot of moving parts: RED, antidumping, overall viewpoint toward ethanol, and upheaval in EU with respect to Brexit. &ldquo;We remain optimistic about the possibility of expanded European access. There&rsquo;s a lot of opposition to grain-based ethanol and we&rsquo;ve tried to set the record straight. And we&rsquo;ll continue.&rdquo;
Moving forward, the cap will affect competitiveness of U.S. ethanol, but hasn&rsquo;t affected exports short-term because the EU Member States haven&rsquo;t ramped up ethanol blending, Wilson says. &ldquo;That 7% hasn&rsquo;t necessarily been prohibitive to us, but we do see it as an issue regarding the current science that&rsquo;s available surrounding first-generation biofuels.&rdquo;
&ldquo;The 7% cap is just more trouble,&rdquo; Hubbard says. &ldquo;It&rsquo;s kind of a signal that there&rsquo;s going to be even greater challenges down the line and I think it has an impact on exporters in a way that just leads them to believe that the market is not going to be a longstanding market for the U.S. ethanol industry.&rdquo;
Looking ahead to promising export markets for U.S. ethanol in 2021, the EU will not be on that list, Hubbard says. &ldquo;Oh, no way.&rdquo; The focus on exports to Europe has moved away from the EU as a block, and instead to certain key markets, he adds.
ePure, along with USGC, RFA and others, meanwhile, will continue the fight to showcase the emissions-reduction benefits of first-generation ethanol in the EU. The increase to 24% renewables in transport, in fact, will require it. &ldquo;It means increasing the contribution of all renewable energy possible, including biofuels,&rdquo; Desplechin says. Author: Lisa Gibson Editor, Ethanol Producer Magazine 701.738.4920 lgibson@bbiinternational.com

2020/10/ex-glance-1120_16031230006012_largethumb.jpg

2020/10/ex-glance-1120_16031230006012_thumb.jpg

2020/10/ex-glance-1120_16031230006012.jpg

2020/10/ex-adcon-1120_16031229985943.jpg

2020/10/ex-feed-1120_16031229996019.jpg

2020/10/ex-import-1120_16031230016094.jpg

Climate goals in the European Union place a 7% cap on crop-based biofuels, a standard that renewables organizations, both in Europe and the U.S., say is unnecessary and not backed by science.

Biofuels Barrier

Related Stories

USGC, NCGA hold trade policy academies for members in Iowa and Michigan

UNICA reports record ethanol production, sales for 2024-‘25

EIA weekly data: Ethanol production up 2%, stocks down 5%, exports down 45%

California bill aims to expedite availability of E15

RFA thanks lawmakers for bipartisan support of summertime E15 waiver

Upcoming Events

North American SAF Conference & Expo

Biofuels Barrier.css-7jxktu{position:absolute;bottom:0px;left:0px;right:0px;height:3px;border-radius:3px;background-color:var(--chakra-colors-brandBlack);}