EU’s ‘Fit for 55’ package targets emissions in bloc

IN BRIEF

EU: Imports of biofuel are expected to drop by a quarter this year as the bloc draws on large stocks to meet rising demand following the easing of COVID-19 restrictions, Reuters reported the European Commission (EC) as saying on 6 July.

“Due to abundant unused stocks, imports of biofuels are expected to decline in 2021 by about 25% to 3bn litres for biodiesel and 1bn litres for ethanol,” the EC said in its short-term outlook for agricultural markets.

However, imports of used cooking oil (UCO) from China and other Asian countries for producing biodiesel had increased by over 30% last year, and the share of this feedstock was expected to continue growing in 2021.

BRAZIL: The government has raised the country’s mandatory biodiesel blend rate from 10% to 12% in a bid to control fuel inflation amid high soyabean prices, Reuters reported on 13 July.

The increase was below this year’s target of 13%.

About 70% of Brazil’s biodiesel was produced from soyabean oil and prices had been rising due to strong demand and tight supply of soyabeans, Reuters wrote.

USA: The United States Department of Agriculture announced an additional US$700M COVID in aid package for biofuel producers on 15 June.

A month earlier, US President Joe Biden’s proposed 2022 budget also included financial backing for biofuels, bioenergy and sustainable aviation fuel (SAF), Ethanol Producer reported on 2 June. The budget allocated US$1bn in support over the 2022/26 period. It also included US$15.4bn in support to increase biorefinery, renewable chemical and biobased product manufacturing.

EU's 'Fit for 55' package targets emissions in bloc

The European Commission (EC) published its ‘Fit for 55’ legislative package on 14 July, which proposes more blending of sustainable aviation fuel (SAF) and maritime fuel.

The ‘Fit for 55’ package provides clear and binding targets towards greenhouse gas (GHG) emissions reductions of 55% by 2030.

The ReFuelEU Aviation initiative would oblige fuel suppliers to blend increasing levels of SAF in jet fuel taken onboard at EU airports, including synthetic low carbon fuels, known as e-fuels.

The FuelEU Maritime Initiative would stimulate the uptake of sustainable maritime fuels and zero-emission technologies by setting a maximum limit on the greenhouse gas content of energy used by ships calling at European ports.

Although the ‘Fit for 55’ proposals were welcomed by the European Biodiesel Board (EBB), it said the transport sector needed more sustainable, affordable and available solutions like biodiesel.

“Today’s package severely limits biodiesel’s role and fails to provide the right support and incentives to fully ramp up European transport decarbonisation efforts. Most significant is the striking absence of support for sustainable biodiesel in hard-to-decarbonise transport sectors like freight, aviation and maritime,” the EBB said.

US Supreme Court backs biofuel waivers

The US Supreme Court has ruled that small refineries are eligible for hardship waivers from biofuel blending mandates without having to continuously qualify, Argus Media reported on 25 June.

Last year, the US 10th Circuit Court of Appeals said that small refineries (those that processed less than 75,000 barrels/day) must continuously receive a waiver from the Renewable Fuel Standard (RFS) to remain eligible for exemptions.

However, small refiners argued that they should be eligible for a waiver in any year that they were facing financial hardship, even if they had not sought a waiver for a number of years, Argus Media wrote.

In its ruling, the Supreme Court said: “Our analysis can be guided only by the [RFS] statute’s text – and that nowhere commands a continuity requirement,” Justice Neil Gorsuch wrote.

Biofuel groups had been concerned about

The US Supreme Court has ruled in favour of small refineries receiving waivers from biofuel blending mandates the number of exemptions after waivers increased to 35 facilities in 2017, up from seven facilities in 2015, Argus Media said.

New Argentine law to impact soya prices

A new law in Argentina which cuts the biodiesel blend mandate by 5% could push up global soyabean prices, The Rio Times reported on 20 July.

The newly-approved biofuels bill reduced the biodiesel mix in diesel fuel from 10% to 5%, and gave the Energy Secretariat the flexibility to increase the blending mandate or reduce it to as low as 3%, depending on market conditions, according to an AgriCensus report on 16 July.

“Reducing the volume of [soya-based] biodiesel used in fuels locally will decrease consumption of soyabean oil in Argentina,” CIARA-CEC agro exporters chamber head Gustavo Idígoras was quoted as saying. “Then we will have more soyabean oil to export. This can impact international prices, considering the large share of the international market that Argentina has.”

With the previous 10% rate, Argentina consumed about 1M tonnes/year of biodiesel for blending. This volume could be halved with the new measure, according to Luis Zubizarreta, the president of biofuels industry chamber Carbio.

The bill stipulates that the new biodiesel regulation will be valid until the end of 2030, according to AgriCensus.

Meanwhile, the bioethanol mandate would remain at 12%, with the Energy Secretariat also able to increase or reduce that level depending on market conditions, the report said.