11 Mai 2015

TOP RED reform: European Parliament agrees to cap the use of traditional biofuels

What are the impacts on the bio-based material sector?

In Brussels, the European Parliament, following the decision of the Environmental Committee one week earlier, has finally voted on 28 April 2015 to endorse at second reading the compromise agreed with the Council on the reform of the Renewable Energy Directive (RED) and Fuel Quality Directive (FQD) in the light of indirect land use change (iLUC). The compromise will be adopted this year after the Council’s second reading in the upcoming months.
This short paper highlights the most important changes and additions and explains what they mean for the sector of bio-based chemicals and materials.

Since the new provisions of the Directive are only valid until the end of 2020, this does not constitute a long-term framework that could give security to investors – neither from the energy sector, nor from the material sector. The existing competition for biomass between the sectors is not mentioned, still ignoring highly value-adding and employment-creating bio-based industries. That means that the material sector needs to take the opportunity to influence the framework that will be created for the time up until 2030 in the next few years by actively participating in the political debates in Brussels and the member states to finally establish a level playing field.

The most important changes are summarized in this table and will be explained in more detail further below.

Measure in the iLUC reform Expected impact on material use
1) 7% cap on food-crop based fuels neutral/positive – delayed impact
2a) Non-binding 0.5% target on advanced biofuels neutral
2b) Annex IX – double counting & wastes and residues negative – high impact
3) ILUC criteria not binding positive – low impact
4) Carbon capture and utilization for fuels positive – low, delayed impact
5) Higher incentivization of green electricity positive – high, delayed impact

Download the full version of this short study with detailed commentary: 15-05-11_PR_RED_Reform_Material_Sector_nova

Source: nova-Institut GmbH, press release, 2015-05-11.

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