German authorities have reached an informal agreement to no longer allow advanced biofuels to be double counted toward the greenhouse gas (GHG) quota.
An internal memo from industry association VDB shows a final decision has not been made, but it says the energy ministry BMWE expects a legal amendment to come into force on January 1 2026 when the EU's RED III legislation will be implemented to German law.
Earlier in the week there had been a sudden increase of GHG quota trading activity and a rise in prices, which market participants attributed to rumours that the abolition of double-counting had already been decided.
The internal memo says an unspecified agreement has also been reached on the issue of protection of trust. The environment ministry BMUV had pushed to discontinue this, which would allow authorities to cancel certificates if they were generated through fraudulent activity, such as the false declaration of biofuel imports.
If implemented, this could support prices for biofuels and GHG certificates.
The remaining undecided points in the RED III implementation include a cap on the use of plant-based biofuels such as FAME or RME, the accounting of biogenic hydrogen used in petroleum refineries, and another refinery-related issue.
According to the BMWE's draft bill, the energy share cap of feedstock-based biofuels will be reduced to 3pc by 2030, from 4.4pc. It also introduces a minimum quota for renewable fuels of non-biological origin (RFNBO), at 0.1pc in 2026 rising to 12pc by 2040. RFNBOs include synthetic fuels such as e-fuels like Power-to-Liquid and green hydrogen. Availability of these remains low, so companies with refinery capacity would be at an advantage to generate RFNBO certificates.
