In our post-industrial history, liquid fuels have been a cornerstone for the development of the transport sector due to the many advantages they present: relatively high energy density, safe operating conditions, the ability to be easily transported, stored and handled, etc. They first served as a basis for the development of the internal combustion engine and then led to the profusion of transport modes we know today such as cars, motorboats and planes. Since the Kyoto protocol, generalized and abundant transportation (14% of worldwide emissions in 2010) was revealed as a prime factor of anthropogenic climate change. Europe’s shift to a low emission mobility sector is now paramount.
Along with many other types of crops, corn, soy, sugar beet, sugarcane and wheat are turned into liquid biofuels daily thanks to contemporary industrial transformations. Today, biofuels’ expansion remains a very touchy and complex topic that has fueled both incredible disillusions and hopes for the decarbonization of the transport sector. With the negotiations of the revised Renewable Energy Directive that came to an end in June 2018, the topic of biofuel has taken unique proportions in the media. At Greenfish, we believe that shedding light on and purposefully communicating about this intricate topic is crucial to sustainability education. In this White Paper, Greenfish explains the ins and outs of the history of biofuel development in Europe. Below, we give you details about the different types of biofuels and their growth over the years. We then delve into the scientific reasons behind the main criticisms of biofuels, and we conclude with a summary of the current state of European legislations, opening the discussion on the appropriate decarbonization options for Member States.
The story of European policy-making about biofuels is a prime example of the difficulty that decarbonization poses to our societal organizational models. Take your ticket and let’s start the tour!
When green gold is politically popular…
Let’s start with the basics. Biofuels are a type of fuel produced from plants or indirectly from agricultural, industrial and other waste materials. Unlike fossil fuels, originating from a geological process over centuries, biofuels stem from a biological process, over a short period of time. They are primarily used in transportation. For the sake of clarity, we will solely focus on major liquid biofuels. In the insert below, we provide a 101 technical explanation of their typology which is crucial to the understanding of the topic.
Modern biofuels are produced from a variety of resources in two principal forms: ethanol and biodiesel. In general, ethanol is produced from sugar-rich biomass and a fermentation process while biodiesel production relies on vegetable oils (palm oil, rapeseed oil, soy oil, …) or animal fats combined with alcohol using transesterification. Biofuels are classified depending on their level of development and crop origin, in three generations.
Whether you know it or not, biofuels have been at your gas station for years, blended into conventional gasoline and diesel. Their use has risen over the last decade to reach 6.45% of the total fuel consumption in the European Union (see Figure 1 below). France and Germany are ahead of the pack in terms of absolute consumption and are reaching respective penetration levels of 8.9 % and 6.9 % in total energy used for transportation in 2016 (see Figure 2 below). Countries such as Sweden, Austria and Finland have vigorously increased their use of biofuels since 2011 to reach more than 10% of renewable energy in the transportation sector (more than 30% in Sweden). Europe, being the world’s largest market for diesel cars , uses a far greater proportion of biodiesel (≈ 80%) compared to bioethanol (see Figure 1). This trend is widely spread across most Member States.
Figure 1 – Trend in biofuel consumption (liquid and biogas) for transport use in the European Union (EU 28) in Mtoe (million tonnes of oil equivalent) , 
Despite these trends in consumption, the EU is far from being independent of its biofuel supply. While it has significantly reduced the quantity of imported biofuels over the last years (see Figure 3 below), Member States still rely on imported biofuels and especially on raw materials, influenced by market dynamics . Feedstock such as palm oil and soy are indeed massively produced in countries such as Argentina, Brazil, India, Malaysia or Indonesia.
Figure 2 – Comparison of biofuel consumption and its penetration rate for transportation in 4 EU Member States (Mtoe and %) 
(in solid line: annual consumption in Mtoe – left legend)
(in dotted line: share of biofuel – right legend)
European institutions initiated the deployment of biofuel consumption targets for Member States: a minimum of 2% by the end of 2005; a minimum of 5.75 % by 2010; a minimum of 10 % of renewable energy in road transport fuels by 2020 (set in 2009); etc. However, rising concerns over the sustainability benefits of crop extension for the biofuel market started hindering the political direction given by the EU.
When green gold takes some heat for its side effects…
Depending on the raw material chosen, the cultivation context and practices, the calculation of the environmental impact of biofuels is a true conundrum. In theory, a biofuel life-cycle is carbon neutral: the carbon emitted at the combustion is previously offset by the carbon absorbed during the growth of the given feedstock. In comparison to burning conventional fuels coming from sequestered carbon sinks (thus, out of the carbon cycle), biofuels normally generate savings in CO2 emissions. Additionally, the crop can be grown when needed again and again, making biofuels a renewable commodity.
In practice, the use of biofuels has long been criticized because of their environmental drawbacks. This has particularly been the case for 1G crops for which the production started to compete with food production given the availability of fertile land. The mandatory minimum consumption targets set by the US and the EU between 2000 and 2010 dramatically increased the demand for these food-based crops not only locally but also in developing countries . As market participants attempted to increase yields and earnings while at the same time meeting the demand, massive use of pesticides and fertilizers, deforestation, loss of biodiversity, land grab stories and local food supply shortages occurred , , , , , et . To alleviate concerns, the European Commission (EC) agreed, already in 2006, to report on the sustainability of biofuel production every two years and ensure improved practices. Its 2009 Fuel Quality Directive was twofold:
- raw materials for biofuels cannot be sourced from high biodiversity or high carbon stocks;
- manufacturers should ensure that gas emissions from biofuels are at least 60% lower than those from fossil fuels .
The research of the most sustainable crops for biofuels is a long road, full of potholes for policy-makers. Along the way, one of these resulting policies is called “ILUC”. Indirect Land Use Change relates to the unintended CO2 consequences of land use change due to the cultivation of biofuel crops. Facing increasing pressure from 2010 to 2013, the EC launched several scientific assessments of the best literature available on the modelling calculation of biofuel ILUC impacts. In March 2016, it published the “Globiom report” displaying the results of the carbon impact modelling of its biofuels target policy in place for 2020 , . Further analysis of this long-delayed and disastrous document made indisputable conclusions: the most popular biofuels are a carbon bomb. When made from palm oil it would emit about 3 times more CO2 than conventional diesel and around 2 times more when made from soy . Overall, forecasted biofuel production to reach the 2020 targets is expected to emit 1,8 times more CO2 than conventional diesel while bioethanol production was expected to emit 33% less than conventional ethanol (see Figure 4).
Figure 4 – Carbon emissions of biofuels for different feedstocks extrapolated from the Globiom study 
As shown in Figure 4, advanced biofuels could bring higher hopes in terms of sustainability. However, several examples such as the jatropha tree and the giant reed stories or the rise and fall of the Norwegian advanced biofuel sector showed that the 2G industry has failed to deliver on this promise for almost a decade , , ,  et . There are multiple reasons behind this failure (too-low yields on marginal lands, unstable legislative support, fierce competition with low oil prices, invasiveness of the selected species, etc.) but they all would need careful scientific impact assessment before mass scale expansion at the policy and business level. As we said, in addition to being long, the road to sustainable biofuels is also winding.
… sustainable transport is not yet an asset of modern society.
While it allowed the emergence and continuation of the promising transportation sector, the results of the biofuel expansion policy in Europe have been disappointing so far. Making significant use of sustainable and renewable energy in transportation is still a myth.
After the adverse side-effects of 1G biofuel policies, hopes are concentrated on accelerating the 2G and 3G , while getting rid of the ILUC issue and other complications. The revised Renewable Energy Directive, that was adopted after the fifth round of trialogues between the institutions in June 2018, is heading in this direction , . 2030 targets for renewable energy in transport have been set at 14 % (for each Member State); given their drawbacks, 1G biofuels must not exceed 7% of total fuel consumption; and 2G & 3G generation biofuels must at least reach 3.5% of total fuel consumption. The growth of biofuels that contain high risks of ILUC should be frozen by 2019 and gradually phased out from 2023 to 2030, providing that EU commercial partners such as Indonesia, Argentina and Malaysia are not immediately prejudiced in the process, as major palm and soy oil producers .
Some observers view this deal as quite disappointing, allowing food-crop based biofuels with large ILUC emissions to stay in petroleum for many years to come. For others, it finally provides long-term certainty to open the financial floodgates for the development of the 2G while removing the existing competition from the 1G. Consequently, the difficulty now lies in ensuring close monitoring of the feed-stock selection and good practices for the production. For example, the use of mixed species, such as different perennial grasses or different trees has proven to enhance biodiversity, without compromising yield . Conversely, opponents voice fears about the scheme: the definition of waste material (for 2G) remains too vague which could allow for fraudulent transformation of valuable food products into waste for the sole purpose of biofuel production; therefore, repeating the 1G biases ). Long is the road towards sustainable biofuel, we told you!
Biofuel development has not solved the fast-rising emissions problem of transportation in Europe so far. The replacement of current fossil fuel over the next 30 years seems like a complex challenge with the moderate vision given by the EU. While the scheme allows Member States to set up higher targets on advanced biofuels, two major alternatives are also in their hands to reach the remaining 7% of renewable energy in transport by 2030. Electrification, while still marginal, is a rapidly increasing trend. Hydrogen vehicles, an even more marginal phenomenon, is also incentivized by countries such as Germany that plans to put in place 100 hydrogen stations by the end of 2019 . Greenfish will keep reporting on the evolution of these different technologies and their economic evolution. Stay tuned in for our next White Paper on these topics.
Antoine Faure – Business Catalyst at Greenfish
Quentin Lancrenon – Project Analyst, Green Solutions at Greenfish
Nassim Daoudi – Chief Executive Officer at Greenfish
 Food Commodity Prices Volatility: The Role of Biofuels: https://file.scirp.org/pdf/NR_2014042914441315.pdf
 Pesticides meet megadiversity in the expansion of biofuel crops: https://esajournals.onlinelibrary.wiley.com/doi/10.1890/090139
 Drivers and triggers of international food price spikes and volatility https://www.sciencedirect.com/science/article/pii/S0306919213001188
 The Royal Society (January 2008). Sustainable biofuels: prospects and challenges, ISBN 978-0-85403-662-2, p. 61.