BIODIESEL The European Perspective Philippe DUSSER (Sofiproteol)

Transcription

1 BIODIESEL The European Perspective Philippe DUSSER (Sofiproteol) Biodiesel International Conference November 18th, 2011 Sao Paulo CEES/FAAP

2 The French Oilseed Sector Sofiproteol Diester Industrie Prolea

3 A FARMERS CONTROLLED SUPPLY CHAIN Farmers check off money (fees on farmers sales) used to build an oilseed processing industry, Starting in the 80 s FOP The Farmers organization (French Oilseed Producers Sofiprotéol the financial body Crushing refining : Saipol Biodiesel : Diester industry Green chemistry : Oleon Feed Animal Production : Glon Communication for the supply chain : PROLEA

4 Sofiprotéol Industrial activities FEED & ANIMAL PRODUCTION FOOD RENEWABLE ENERGY GREEN CHEMISTRY

5 French leader in Crushing and Refining 7 industrial sites crushing and refining crushing : KT 70% of capacity in France Implantations industrielles de Saipol Autres sites industriels du Pôle valorisation des oléagineux de Sofiprotéol Turnover : 1,6 Billon euros octobre 2010

6 Diester Industrie : World leader in Biodiesel production Norway 13 sites 7 sites in France 6 others through EU Belgium Germany 3 Million Tons production 2 Million Tons (France) 1 million Tons (other EU) France Italy Austria Turnover 2009: - 2,0 Bln in France Mln through EU Biodiesel production sites

7 bio Biodiesel Development in the EU

8 BIODIESEL AND THE EU FUELS MARKET A EU specific situation : Over 55% : Diesel fuel share of fuel for transport car fleet has been increasingly running on diesel motor EU Oil refining industry Over capacity in gasoline, (and under capacity in Diesel fuel). EU has to import diesel fuel (from Russia). Biodiesel as an additive helped replace sulfur as a fuel additive (lubrication). Biodiesel helps balance the fuel supply : Not a competition for Oil Companies

9 EU Major consumer and producer of Biodiesel Biodiesel world production (MnT) 20,00 18,00 16,00 14,00 12,00 10,00 8,00 Total UE USA Argentine Brésil 6,00 4,00 2,00 0, Prolea from FO licht's

10 EU imports : 2 MioT Exporters : US (when B99) Argentina Indonesia Biodiesel net exports (MnT) 2,50 2,00 1,50 UE 1,00 0,50 USA 0,00 Argentine -0,50-1,00 Indonesie -1,50 Brésil -2,00-2,50-3, Prolea from FO licht's

11 bio Feedstock

12 EU feedstock Rape : 55 to 70% - Soy : 20 to 30% Palm : 5% - Fats and UFO : 10% % 11% 10% 5% % 13% 24% 24% 28% Fats & UFO Palm Soy Rape % 57% %

13 World : Soy Oil share increasing % 17% 42% 35% 13% 33% 33% 27% 44% Fats & UFO other oils Coco Sun Palm Soy Rape

14 How Biodiesel has developed in EU Drivers : Energy independence GHG / Climate Agricultural Policy 1/ Producers initiative (before 1992) new outlet for rapeseed oil (instead of export) 2/ CAP reforms (from 1992) : production on set aside (10% mandatory set aside till 2008) 3/ Climate policy : reduction of GHG emissions - incorporation targets 2003 non binding target 5,75% : mandatory 10%

15 Germany and France: over 50% of production 10,00 8,00 6,00 4,00 2,00 UE : Biodiesel production by country (MnT) Total UE Allemagne France Italie Belgique Pologne Portugal Suède/Danemark Autriche Espagne Royame-Uni 0, European biodiesel board EBB

16 Support : decision up to the country Biodiesel not competitive with fossil fuel Support Tax exemptions (some countries) : this type of support (govt budget) is being phased out Mandatory blending (with penalties) the consumer pays.

17 EU regulation The Renewable Energy Directive

18 Two main European Directives Fuel Quality Directive (FQD) (2009) Renewable Energy Directive (RED) - 20% of renewable energy in EU in 2020 on total energy consumption - 10% of renewable energy in transport in EU 2020 Biofuels must be sustainable to count for national targets

19 Sustainability criteria: Greenhouse Gas (GHG) emissions saving shall be at least 35% (and 50% as from 2017) Raw materials shall not be obtained from land with high biodiversity value (like primary forest and highly biodiverse grasslands) with high carbon stock (like wetlands and continuously forested areas) that was peat land in January 2008 Raw materials cultivated in EU shall be obtained in accordance with good agricultural and environmental condition => cross-compliance rules Social aspects

20 Certification of sustainability Certification system : 3 possibilities National system Bilateral Agreement (with non EU exporting countries) Voluntary Scheme recognized by the EC Traceability through a mass balance system : certificates follow the product, on a statistic basis : each operator must balance the amount of product sold to the biodiesel chain with the amount of certified feedstock he bought.

21 IMPLEMENTATION Implementation has started since January 2011 But still under a transitory regime : difficulties Delays on part of Commission some regulations still not ready : definitions of biodiverse Grassland, and degraded land Voluntary schemes 7 adopted in July, 8 on waiting list Some Member States still have not transposed and no national certification scheme.

22 Current debates Food vs fuel ILUC : Indirect land use change

23 CONTROVERSY FOCUSES ON ILUC Debates Food versus Fuel GHG : assessment of reductions taking into account Indirect land use change RED 2008 compromise on ILUC Commission must study ILUC, make a report by December 2010 and make proposals if necessary. NGO s see ILUC as a way of reviewing the 2008 political compromise on 10% target.

24 The ILUC Procedure at the Commission The EC is currently working on an Impact Assessment on biofuels ILUC, based on four policy options outlined in the Commission report published on December 22nd Take no action - Increase the minimum GHG threshold for biofuels - Introduce additional sustainability requirements - Attribute a quantity of GHG emissions to biofuels reflecting the estimated Iluc impact ( ILUC factor ) A deadline was set for July 2011

25 ILUC The «IFPRI study» on which the Commission bases its assessment, gives an ILUC factor for biodiesel of grco2eq/mj which would eliminate biodiesel from the market. To this date, the Impact assessment due for July hasn t been issued -

26 Some of the listed uncertainties Crop yields in the baseline and in scenarios How does yield reacts to price? Yield on new land? Substitution among vegetable oils To what extent can substitution take place? The livestock sector/availability of pasture Will intensification take place? Land governance Emissions from palm oil planted on peatland Global agricultural policies towards 2020

27 Policy options ILUC-factors risk leakage across different markets Raising the threshold is an easier option Alternative trade policies can promote good land governance at a national level and be more effective

28 Conclusion Some benefits from biodiesel to EU

29 In spite of controversy Public in France still favorable to biofuels (60%). Biodiesel demand triggered a doubling of rapeseed production (11 miot in 2004 to 21 MioT in 2011) 6 Miot of supplementary rapeseed oil (2/3 of biodiesel production) 4 Miot of meal co-product.. less soybean meal imports

30 Thanks for your attention