ILUC: The ‘Soap’ Continues

By Robert Vierhout | March 05, 2012

Every once in a while I dedicate my column to the topic that is loved by those who hate biofuels: ILUC. 

Contrary to the USA where the U.S. EPA managed to get some indirect land use change (ILUC) values out of a black box relatively quickly, the EU is progressing slowly in ‘solving’ ILUC. For already more than two years, the European Commission services have been deliberating what to do.

In my opinion, the delay in putting a bill on the table is caused by the fact that the ILUC ‘science’ is simply not conclusive. A study by the International Food Policy Research Institute assessing ILUC caused by biofuel policy does not seem to convince everyone within the commission that indirect land use change is more than just an imaginary problem. The mere fact that the IFPRI researchers themselves expressed reservations and caution about the results of their work creates uncertainty on what measures to propose.

The latest compromise under discussion by the commission services would allocate an ILUC value differentiated by crop (vegetable oil, sugar and starch) to biofuels to be used to achieve the target set in the law on fuel quality. This target aims to reduce greenhouse gas (GHG) emissions by 6 percent by 2020. In the Renewable Energy Directive, on the other hand, three different measures would be introduced: raising the threshold for direct emissions from 35 to 45 percent reductions and for new (date unknown) installations to 60 percent and, finally, there would be a subtarget of 1.5 percent point set for double counting biofuels (those biofuels produced from waste, residue or cellulose material).

To me this seems rather messy legislation: trying to address by different means in different laws a still-to-be proven problem. I guess this is the type of legislation one would expect from a problem that is more political than factual in nature.

But, let’s assume, for the sake of the argument, that the effect would occur some time in the future under a business-as-usual scenario. Would these measures prevent ILUC, one example being tropical deforestation?

Unlikely.

If countries in Southeast Asia can no longer, due to this ILUC value, export their palm oil to the EU, they will find other markets, most likely closer to home. A leakage effect would occur. If, as a result, the EU produces less biofuel, would we then not even need to import more biofuels to compensate for the lower GHG saving? More imports, more risk of unwanted land use change? Finally, we would not be addressing the problem where it is occurring: outside Europe.

A more effective way to prevent unwanted land use changes leading to higher carbon release is by concluding agreements with the countries that are exporting biofuels to Europe. These agreements should restrict or forbid imports of certain biofuels unless proper land management is guaranteed.

This could cause a legal battle at the World Trade Organization level, but such a measure seems legitimate if it would avoid adverse environmental effects. Punishing all biofuels instead, simply to avoid going to the WTO over a matter of principle, is not justified.

Brazil shows that it is possible to manage land in a responsible way. Its tropical protection program, Amazon Region Protected Area, resulted in a 75 percent reduction in tropical forest clearing since 2004, even as ethanol production doubled.

Rewarding mitigation, responsible land management and recognizing the value of animal feed production is a more constructive way forward than applying the conservative politics of punishment. Policy will yield better results, if it based on positive instead of negative incentives.

Author: Robert Vierhout
Secretary-general, ePURE
Vierhout@epure.org