A Longer-term Perspective Needed

By Robert Vierhout | April 01, 2013

Bureaucratic organizations can be strange animals. I suppose that in every country on this planet, government departments often fight or ignore one another, whereas the principle should be to pursue synergy by working together.

In the many years I have worked in the Brussels regulatory environment, I have often noticed that the various directorates of the European Commission were fighting or working against each other as if they were warring tribes. One is not surprised when a directorate issues a statement or pursues an agenda that runs counter to what another directorate is doing or trying to accomplish. I can give many examples of these inconsistencies, but the most striking for me was the following series of events.

On Oct. 17, the European Commission published a legislative proposal making a U-turn in its biofuel policy. The core of the proposal is to limit the use of conventional biofuels to 5 percent of the biofuels market. If this were to become a reality, conventional ethanol use by 2020 would be around 7 billion litres (1.8 billion gallons) at best. 

One day earlier, the European Commission published a statement saying that by 2022 there would be a conventional fuel ethanol market of 14 billion liters. And one week earlier, on Oct. 10, the Commission announced new targets for the EU to counter the decline of Europe’s industrial base. I quote from the press release: “The market for biochemical products could be worth €40 billion ($52 billion) and provide more than 90,000 jobs by 2020.” 

All this, within a week. As one of my colleagues said, “Should we laugh or cry?”

Government officials are no different from normal human beings, so inconsistencies will happen; especially if there are different services involved that are not fully aware, apparently, of what their colleagues are doing. Within a directorate one would expect more consistency, but this is not guaranteed either. Still, it’s difficult to understand why, less then three years after the publication of the Renewable Energy Directive, a bomb has now been put under investments requested by the Commission. And, already the Commission is working on a new energy and climate policy framework for 2030. 

A document prepared for an orientation debate at the highest level of the Commission reveals that Europe still has to import 90 percent of its energy needs, one-third of which comes from Russia. The transport sector is still the largest consumer of energy and biggest greenhouse gas emitter and its share of consumption is rising. Another remarkable fact presented in this document is that, to date, the Netherlands and the U.K. show the lowest share of renewables in their energy mix. These two nations are at the forefront of demanding the highest possible environmental standards for biofuels, but their relative share of fossil fuel is among the highest in the EU. It is ironic to read statements such as: “certainty about the long-term regulatory framework is needed,” “new opportunities for jobs and growth,” “investors need certainty and reduced regulatory risk.” We have seen this kind of language before, in documents previously drafted to justify targets for biofuels, yet now it no longer seems to apply to the biofuel sector.  

Even so, it would not be wise to be cynical about this initiative and to discard it. After all, the present renewable energy law will cease to exist as of 2020, by which time many investments will still have not yet been repaid. Nor can we expect substantial volumes of competitive advanced biofuels in the market. Knowing that conventional ethanol is a building block to achieve cellulosic ethanol, from an agricultural point of view, the ethanol industry needs to lobby for post-2020 targets. 

The Commission is planning to release a major policy paper or possibly even a bill by the end of this year, which means that our lobbying agenda has obtained a new dimension. Besides the fight to maintain a reasonable target until 2020, we also need to prepare the ground for what should happen beyond 2020. A long-term perspective on this is absolutely necessary. Without it the EU ethanol sector is doomed.

Robert Vierhout
Secretary-general, ePURE