The European Commission serves up real limits on palm biofuel
Germany’s RED II implementation plan supports the country’s ambitious climate goals
Last month the German Ministry of the Environment (Bundesministerium für Umwelt, Naturschutz and nukleare Sicherheit- BMU for short) released a draft bill to increase its current greenhouse gas reduction quota in transport, and simultaneously implement the EU recast of the Renewable Energy Directive (RED II). The draft bill proposes raising the current greenhouse gas reduction quota in transport from 6% in 2020 to 7.25% from 2026. The proposal also offers improvements to the Directive, which will help contribute to Germany’s goal of reducing greenhouse gas emissions by 55% relative to 1990 levels by 2030.
The BMU’s proposal seeks to address the climate issues associated with palm oil on an accelerated time scale. As my colleague previously blogged, palm oil qualifies as a “high” indirect land use change (ILUC) feedstock, which means, according to the RED II, its use needs to be phased out by 2030. In light of the strong evidence of very high emissions due to tropical deforestation associated with this feedstock, the BMU is proposing a faster phase-out of high-ILUC feedstocks by 2026. The plan to remove palm oil from biodiesel by this earlier date will prevent thousands of tons of palm oil from being used in biofuel in Germany.
The BMU is also proposing that Germany move faster than the EU to limit food-based biofuels. The RED II requires member states to cap their contribution of food and feed-based fuels to transport energy at 2020 levels plus 1% (as long as they don’t exceed 7%). This means that even as palm oil is phased out, other feedstocks could fill its place to reach the cap. However, the BMU has proposed a more progressive goal for Germany—their proposal subtracts the current contribution of palm oil to transport energy (0.7%) from the current level of food-based fuels (3.4%), thus reducing the food-based cap to 2.7% by 2026, effectively capping non-palm food-based biofuels at 2018 levels. By not allowing the contribution of other food-based feedstocks to backfill palm oil, the BMU is aligning its legislation with the reasoning behind the ILUC Directive, which set the food-based cap to limit ILUC impacts of food and feed-based feedstocks in the RED. As a previous ICCT blog illustrated, even reducing the cap by a few percentage points, as the BMU is proposing, greatly affects the overall greenhouse gas impact of biofuel policy.
The waste biofuels industry has criticized the BMU proposal, for not being ambitious enough on the promotion of the use of cooking oil (UCO) and animal fats. This is because the BMU caps Annex IX, Part B feedstocks at a level only slightly higher (1.9%) than the “soft” cap of 1.7% in the RED II. However, there is a good reason for keeping the cap at this level, as I explained in a blog last year. Increasing the cap any further would lead to displacement emissions due to current alternative uses of animal fats, and these effects could be exacerbated due to “downgrading” higher quality fats into lower quality categories to qualify for Annex IX. And, as the waste oils biofuel industry knows too well, too much ambition could lead to fraud.
The BMU proposal also reflects the fact there will not be enough low-carbon biofuels and biogas to support the entire fleet of vehicles on the road, and it supports efforts to decarbonize road transport using renewable electricity. As another previous ICCT blog highlighted, the way that renewable electricity is utilized is very important—battery electric vehicles are a much more efficient use of the energy than using it to produce e-fuels for an internal combustion engine. The BMU’s support of electric vehicles reflects the German government’s goal of rapidly increasing the deployment of electric mobility to help meet national climate goals.
After years of negotiation, the RED II was a compromise among a diverse group of stakeholders. With its implementation, each member state has the opportunity to exceed its ambition, which the BMU has decided to pursue by reducing the food and feed-based cap beyond what is required. At the same time, the BMU recognizes that UCO and animal fats can play an important role in decarbonizing transport, but that using too much of these feedstocks in biofuel can have indirect, unwanted climate impacts.