Originally published as Covington E-Alert on October 23, 2012

On October 17, 2012, the European Commission presented a proposal that would limit the consumption of food crop biofuels and bioliquids in Europe.1 The proposal is intended to respond to allegations that food crop biofuels and bioliquids result in higher world food prices and indirect land use change (“ILUC”) gas emissions. It could result in a U-turn from the EU’s biofuels policy and significantly affect current and future investments in the sector.

The Commission’s proposal must now be considered for adoption by the European Parliament and Council. The following are likely to be the most controversial issues during the legislative procedure:

  • A 5% cap on the contribution of food crop biofuels to the current 10% renewable energy transport target. This cap would significantly prevent any further increase of the market share of food crop biofuels in Europe.
  • An increase of the greenhouse gas emission savings compared to emissions from fossil fuels that biofuels and bioliquids must achieve, and the extent to which installations already in operation may be grandfathered.
  • The possibility to include ILUC emission factors in the methodology to calculate the greenhouse gas emission savings required for biofuels and bioliquids. Such factors could effectively prevent the marketing of biodiesel in Europe.
  • The extent to which food crop biofuels should benefit from EU and Member State support.

This note briefly reviews the most important proposed changes affecting the production and consumption of biofuels in Europe and explains the legislative procedure that will follow.

Read the complete article here

 

 

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Photo of Cándido García Molyneux Cándido García Molyneux

Cándido García Molyneux is a Spanish of counsel in the Brussels office of Covington & Burling.  His practice focuses on EU environmental law, renewable energies, and international trade law.  He advises clients on legal issues concerning environmental product regulation, emissions trading, renewable energies…

Cándido García Molyneux is a Spanish of counsel in the Brussels office of Covington & Burling.  His practice focuses on EU environmental law, renewable energies, and international trade law.  He advises clients on legal issues concerning environmental product regulation, emissions trading, renewable energies, energy efficiency, shale gas, chemical law, product safety, waste management, and international trade law and non-tariff trade barriers.  Mr. García Molyneux was very much involved in the legislative process that led to the revision and amendment of the ETS Directive and Renewable Energies Directive.  He is an external professor of environmental law and policy at the College of Europe.

Photo of Rubén Kraiem Rubén Kraiem

Rubén Kraiem is a corporate partner who advises clients with business interests in Latin America, as well as companies based in Latin America who are engaged in cross-border acquisitions or financings.  Mr. Kraiem has been involved in many significant life sciences, banking and…

Rubén Kraiem is a corporate partner who advises clients with business interests in Latin America, as well as companies based in Latin America who are engaged in cross-border acquisitions or financings.  Mr. Kraiem has been involved in many significant life sciences, banking and insurance-related acquisitions and joint ventures in Latin America, as well as transactions in industries as diverse as telecommunications, media, real estate development, healthcare, and consumer products.  Mr. Kraiem is also co-chair of the firm’s Clean Energy & Climate Industry Group.