An EU strategy for biofuels

Feb 2006

In the EU, transport is responsible for an estimated 21% of all greenhouse gas emissions that are contributing to global warming, and the percentage is rising. In order to meet sustainability goals, in particular the reduction of greenhouse gas emissions agreed under the Kyoto Protocol, it is therefore essential to find ways of reducing emissions from transport.
This is not the only challenge. Nearly all the energy used in the EU transport sector comes from oil. Known oil reserves are limited in quantity and restricted to a few world regions.
New reserves exist, but will mostly be more difficult to exploit. Securing energy supplies for the future is therefore not only a question of reducing import dependency, but calls for a wide range of policy initiatives, including diversification of sources and technologies.
This communication looks at the role biofuels could play in this context. Processed from biomass, a renewable resource, biofuels are a direct substitute for fossil fuels in transport and can readily be integrated into fuel supply systems. Biofuels can be used as an alternative fuel for transport, as can other alternatives and thus help prepare the way for further advanced developments, such as hydrogen.
Although most biofuels are still more costly than fossil fuels their use is increasing in countries around the world. Encouraged by policy measures, global production of biofuels is now estimated to be over 35 billion litres.
The EU is supporting biofuels with the objectives of reducing greenhouse gas emissions, boosting the decarbonisation of transport fuels, diversifying fuel supply sources and developing long-term replacements for fossil oil.
This Communication complements the Biomass Action Plan and is accompanied by an Impact Assessment which presents different policy options. Based on this assessment the Communication recommends a regulated market-based approach, corresponding to the Impact Assessment’s option 2, which reflects current knowledge and seeks to prepare the way for future developments. This option in particular favours a balanced approach in trade negotiations concerning biofuels, the use of available instruments in agricultural, rural development and cohesion policy, and the development of a coherent assistance package for developing countries. While existing technologies do not at present offer cost-competitive solutions for the EU, the benefits of encouraging the development of biofuels should outweigh the cost. In this context, the development of second generation biofuels, in which research and development has an important role, could further contribute to their cost effectiveness.

By: European Commission

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