Second generation biodiesel lived to fight another day in the Netherlands, where a parliamentary debate this week on proposals to meet 2020 renewable energy goals ended inconclusive.
The Dutch biodiesel market is hunkering down for a period of lobbying, after environment minister Sharon Dijksma agreed to enter further discussions with the economy ministry and to submit a renewed technical briefing to parliament within the next month.
The share of renewable fuels in transport needs to hit 10pc by 2020 under the EU's Renewable Energy Directive (RED). To meet this and curb greenhouse gas (GHG) emissions, the Dutch environment ministry last year presented a package of reforms to be implemented from 2018.
First was a 5pc cap on first generation biofuels made from vegetable oils — lower than the 7pc limit proposed by the EU, as GHG savings for these are not as high as originally thought because of indirect land use (Iluc) change factors. The ministry also stipulated a sub-target for non-food cellulosic and lingo-cellulosic material at 0.3pc from 2018, rising to 0.5pc in 2020.
The most contentious part of the plan was to scrap the double-counting of biodiesel made from used cooking oil (Uco) or tallow, which biodiesel producers say would kill 50pc of demand for these products. The government hopes this will close loopholes that open the system to fraud, amid verification and traceability difficulties, but the industry argues many of the concerns are being addressed through independent certification schemes, that the measure is unnecessary and could kill a growing industry.
Second generation grades — which offer much higher GHG savings than first generation biodiesel — made up 72pc of the Netherlands' biofuels market in 2015, but this will drop to 18pc by 2020 under the proposal. The shortfall will inevitably be made up of cheaper first generation material, which is counter to the aim of reducing use of these products and increasing GHG savings.
A Dutch producer said that before the debate the market was almost resigned to accepting the abolition of double counting, and was hoping for an increase of incorporation levels to maximise demand for biofuels as a whole. But the tide turned during the session and things are looking a little more promising for the local industry.
"Best case for the industry as a whole the drop the issue and set clear goals post-2020. It is stupid to change again the pathway for the Dutch producers and suppliers," the producer said.
A biodiesel broker said it is likely the government "won't go ahead with this weird first idea, since in this day and age it does not make sense at all."
