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Biofuels

Policy Position

Note: One FDF member, which is a substantial food producer and biofuels investor, takes a different view on certain key elements of this position.

FDF recognises the role which sustainable biofuels can play in helping to meet demand for renewable energy supplies and in reducing greenhouse gas emissions. But this should not be at the expense of resources needed for food and water security, or in ways which distort markets for agricultural products for human consumption.

The position is further complicated by the range of raw materials and production methods currently in use and continuing uncertainties over the potential of new (second generation) technologies to address some of the sustainability challenges involved.

The economic and social impacts of biofuel production also vary according to the relative prosperity and/or development needs of the countries concerned.

Against this background, we support the conclusions of the June 2011 G20 summit on the need for further analysis of the relationship between biofuels production and the availability of food supplies, the response of agriculture to price increase and volatility and the factors contributing to environmental sustainability.

We also support the associated recommendations of the OECD and other international bodies calling on governments to remove policy provisions which subsidise or mandate biofuel production or consumption, or at a minimum to develop contingency plans to adjust those policies when global markets are under pressure and food supplies are endangered.

In that context, we urge the European Commission and Member States to bring forward their planned review of the impact of the implementation of the existing binding renewable transport fuel target on the availability of foodstuffs at affordable prices and to increase investment in researching both current impacts and the scope for advanced technologies to promote a more sustainable balance between food and energy security in future.

Background

The first EU Directive setting targets for biofuel consumption dates from 2003. Current targets were set in the Renewable Energy Directive of 2009, following a 2007 Communication on strategic energy needs endorsed by the European Council that year. Similar policies apply in a range of other non-EU countries, particularly the USA and Brazil.

The 2009 EU Directive provides for the Commission to provide a report by the end of 2014 on the feasibility of meeting the 2020 minimum level of 10% use of renewables for transport in Member States, taking account of sustainability implications in the EU and third countries (economic, environmental and social), including indirect effects and impacts on biodiversity, the commercial availability of second generation biofuels and the effects on the availability of foodstuffs at affordable prices.

In recent years global levels of biofuel production have increased significantly. There have also been episodes of unusual commodity price volatility and heightened awareness of pressures on the resources necessary for crop production. This has led to a number of reviews and studies of the challenges posed and opportunities offered by biofuels, including, in the UK, the Royal Society in 2008, the Nuffield Council on Bioethics in 2011 and a range of Government reports (Gallagher, AEA Technology, House of Commission Environmental Audit Committee and various Defra studies).

Further work was undertaken at international level in preparation for the June 2011 G20 summit, including a joint report by the OECD and nine other bodies (FAO, IFAD, IMF, UNCTAD, WFP, World Bank, WTO, IFPRI and the UN HLTF) into possible policy responses to Price Volatility in Food and Agricultural Markets.