EU governments fail to agree on limit for food-based fuel

BRUSSELS, Belgium (Reuters) — European Union energy ministers have failed to agree on a compromise deal to limit the use of transport fuel made from food crops.


Critics say using food crops to make biofuel pushes up food prices and can do more harm than good to the environment.


Energy commissioner Guenther Oettinger said the delay would damage the EU’s efforts to reduce dependence on gas and oil imported from such sources as the Organization of the Petroleum Exporting Countries and would hurt its drive to curb greenhouse gas emissions.


“If we delay and postpone, the winners will be OPEC and Russia,” he said.


Last year, the European Commission responded to warnings about food price inflation and unintended consequences on the environment by proposing to cap the bloc’s use of biofuel based on crops such as corn and rapeseed at five percent.


That compares with an existing goal to have 10 percent of transport fuel made from renewable sources by 2020, which would be almost entirely derived from food-based fuel.


Lawmakers in the European Parliament backed a slightly higher cap of six percent, stirring opposition from the biofuel industry.


The industry has made its investment decisions based on the original 10 percent goal and accuses the commission of a U-turn that it says will force plant closures and cost jobs.


EU energy ministers recently debated a new compromise of seven percent put forward by Lithuania, which currently holds the EU presidency.


Member states were deeply divided. Some, such as Poland and Hungary, argued a seven percent cap was too low, while Denmark and Belgium, for instance, said it was too high.


Others said a compromise deal should be accepted on pragmatic grounds.


“There are some good victories for the environment compared to the current directive,” said Ed Davey, Britain’s energy and climate change secretary.


Martin Lidegaard, Denmark’s minister for climate, energy and buildings, wanted more. He called for a sub-target to spur new generation biofuel made from algae and waste, a cap of five percent on crop-based fuel in line with the commission proposal, and accounting of factors such as indirect land use change as soon as there was “a solid, scientific basis.”


ILUC refers to the displacement effect that biofuel can cause as land is cleared for extra food crops to produce them, sometimes negating the aim of curbing emissions because it destroys trees and peatland that serve as carbon sinks.


Representatives of Germany’s biodiesel industry, which is Europe’s largest, welcomed the deadlock, saying it allowed more time to find a more effective approach.


“The compromise did not contain suitable rules which would stop tropical rain forests being cut down,” said Elmar Baumann, chief executive officer of the German biofuel industry association VDB.


“But it would have heavily damaged Europe’s biofuels industry and its farming.”


Anti-biofuel campaigners were also relieved the compromise was not adopted but said the status quo was worse.


“The EU needs to move fast and start listening to the consensus, which is that using food for fuel is an outdated and bizarre policy that needs to stop now,” said Laura Sullivan of the anti-poverty group ActionAid.


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