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Biofuels

The introduction of the UK Renewable Transport Fuels Obligation in 2008 and the EU Renewable Energy and Fuel Quality Directives in 2009 established levels for the first time on the use of renewable fuels in road fuel. As well as established baselines, the EU legislation foresees targets in 2020 for 10% of road fuel to come from biofuels. Member States are free to set lower caps and in September 2017 the UK Department for Transport gave targets of 7.25% from April 2018, increasing to 9.75% in 2020 and to 12.4% in 2032. Of significant importance to the agricultural sector is the introduction of a cap on crop-based biofuels of 4% in 2018, reducing annually from 2021 to reach 3% in 2026 and 2% in 2032. This low level is to push the use of waste derived biofuels instead, and is significantly below the EU crop cap of 7% which was set under the EU Indirect Land Use Change (ILUC) Directive, and will be going down to 3.8% in 2032 under the new version of the Renewable Energy Directive (RED II).

At a UK level whilst an element of UK renewable fuel comes from domestic production, there remains a strong emphasis on imported fuel. Statistics published by the Department for Transport in early May 2017 showed only 29% of sustainable renewable fuel used in the UK was from domestic sources.

Whilst the introduction of renewable fuel legislation has been an important driver in the creation of increased demand for bioethanol and biodiesel - and a subsequent increase in demand for the relevant crops – the issue of biofuels continues to divide opinion. The impact of non-food demand on the food and feed market, particularly in terms of price and availability, has been strongly debated in recent years.

The Indirect Land Use Change Directive (ILUC) came into force in 2015, and is driven by the principle that non-food demand for raw materials (e.g. crops) does not replace existing food and feed demand. Instead it simply displaces it, thereby requiring additional land to be cultivated and cropped to meet total demand. In some instances it is argued this additional cultivated land is of much higher environmental benefit and the carbon savings from the production of biofuels over conventional fuels is less than the carbon emissions generated from the cropping of this additional land. In order for the crop to be accepted as from a renewable source it needs to be certified as such, and in the UK this is almost entirely carried out through EU approved voluntary schemes such as those run by Red Tractor, or the ISCC (International Sustainability and Carbon Certification).

The progressive reduction in crop based biofuels is part of the long term strategy to promote the use of ‘advanced’ or ‘development’ biofuels, also known as second-generation. These are not yet fully defined but include fuel from sustainable wastes. These are starting to come on stream, but due to expense and complexity this is from an extremely low base, as shown by the new UK target of using 0.1% development fuels in 2019, rising to 2.8% in 2032. The future of conventional biofuels in the UK, and the EU which is a major market for exporting UK grown oilseed rape, is in doubt, however replacement with second generation will not be possible for quite some time.