EU to scrap biofuel targets?

Apropos this week's RTFO and Jeremie's post on it, this in The Guardian Weekend:

The European commission is backing away from its insistence on imposing a compulsory 10% quota of biofuels in all petrol and diesel by 2020, a central plank of its programme to lead the world in combating climate change.

The 10% target is "binding" under the proposed legislation. But pressed by its scientific advisers, UN authorities, leaders in Europe, non-government organisations and environmental lobbies, the commission is engaged in a rethink.

"The target is now secondary," said a commission official, adding that high standards of "sustainability" being drafted for biofuels sourcing and manufacture would make it impossible for the target to be met.

A commission source indicated that the EU executive would not object if European governments ordered a U-turn [on their own targets].

Comments

[Bishop Hill]

Not before time! Let's hope this actually happens.

You've probably not seen the article at EU Referendum (not your kind of blog, I would have thought) on the latest from the EU - they're going to ban a whole range of pesticides, it seems. This should keep hunger on the front pages for a while longer.

[Nathan Rive]

Perhaps one of the biofuel guys on this blog want to comment on this? Should we have a moratorium on biofuels in the West, as has been suggested by Monbiot? (Of course, we'd have to let people burn logs at home, etc, but you get the idea.)

On a related note, I have heard comments from European energy researchers who suggest that the EU has been too optimistic with their projections of the role of biofuels in the EU energy balance in the coming decades. On another related note, I have often wondered about the role agricultural protectionism in the EU has played in this whole issue. I'm not well versed on this issue - anyone care to comment?

[Miles]

Er... I'd rather not comment on the EU's current position - but you can see what spokespeople have to say if you look at the Commission's midday press conferences (they're online somewhere)

Looking at the current 'food crisis', one of the key issues is that productivity growth in world agriculture and the level of cereal stocks have been declining year-on-year for about a decade now (see IFPRI's December 2007 World Food Situation). And! I might add, the EU is not sitting on the lakes and mountains of agricultural produce that it might once have deployed in response to this kind of situation. Something tells me few Eurosceptics were invoking that argument in favour of the CAP.

Also, believe it or not, although the current spike itself is dramatic, the level of global food prices is not much higher than 5 or so years ago. The low point was, I think, end of 2005, before which they had been declining for decades.

Current high prices should in theory stimulate investment and increase productivity and there are many areas of the world (esp. Eastern Europe - see www.refuel.eu) with substantial yield improvement potential.

But fuel prices are going up too (fertiliser up hundreds of times in recent years I recall hearing somewhere), which makes it harder for poor farmers to finance investment.

In this context, it's important to remember that we're looking at 10% biofuels in 2020 i.e. not right now - in 10 years: time in which world agricultural investment can be organised. By keeping a lid on fuel prices and providing a vehicle for agricultural investment, they could even be part of the solution (although this is definitely a claim full of caveats). It might even be counterproductive to remove the long-term investment incentive that measures such as the biofuels target provide.

I think we can all agree that piling extra non-food demand for crops onto the market right now isn't going to help. But is that likely? Even without a policy change, high crop prices damage the viability of the biofuels industry itself.

PS - I think we can all at least agree to blame the Americans for encouraging corn when other crops could grow the same biofuel on less land, using less energy - I think I have a post on that in the ITG catalogue somewhere.