July 9, 2008

Europe Considers Cuts in Its Goals for Biofuels British Report Raises New Concerns

By James Kanter

European officials have proposed scaling back dramatically their goal of increasing Europe's use of biofuels, a major about-face on a central environmental and energy issue.

At the same time, a new report by the British government cast fresh doubt on fuels made from crops as a way to the fight climate change.

Until recently, European governments had sought to lead the rest of the world in the use of biofuels, aiming to derive 10 percent of Europe's transportation fuels from biofuels by 2020. But the allure has dimmed amid growing evidence that the kind of targets proposed by the European Union are contributing to deforestation, which speeds climate change, and helping force up food prices.

"I think when we will look back we will say this was the beginning of a turning point for Europe on biofuels," said Juan Delgado, a research fellow specializing in energy and climate change at Breugel, a research organization in Brussels. "It will be very difficult now for Europe to stick by its targets."

In the United States, one-quarter of the corn crop goes to biofuels. An energy bill passed last year requires that 36 billion gallons of biofuels be produced annually by 2022, but criticism of the policy is growing, including calls to end tax breaks for corn- based ethanol.

A major reason is that over the last 18 months, studies have shown that the current generation of biofuels - reliant on food crops like canola, corn and soybeans - helps drive up food prices by using agricultural land, as well as aggravating deforestation, and may be worse for the climate than conventional oil once the cost of production and transport are taken into account.

Most of the world's biofuel is extracted from corn in the United States, sugar in Brazil, and both grain and oil-seed crops in Europe.

Europe's reversal on biofuels had gained significant momentum in recent days. Over the weekend, energy ministers gave one of their strongest signs that EU governments were prepared to back away from the 10 percent target.

"We have to decide if the quota can be kept," Jochen Homann, the German economics minister, said Saturday in Paris. "It might be changed."

Britain, one of the biggest proponents of increased biofuel use, signaled a new course on Monday.

Ruth Kelly, the British transport minister, said the introduction of biofuels should be slowed down, citing a newly released report warning that current targets for biofuel production could cause a global rise in greenhouse gas emissions and an increase in poverty in the poorest countries.

"Given uncertainty and potential concerns, the government will adopt a more cautious approach until the evidence is clearer on environmental and social effects of biofuels," Kelly told the British Parliament.

The Environment Committee of the European Parliament voted Monday to approve the measure and send it to the full Parliament. Members of each major political bloc on the committee called for a much lower target - 4 percent - and said the measures should be reviewed in 2015.

Although the environment committee's vote is not binding, it will add to pressure on the European Commission to issue a revised proposal, said Delgado, the Breugel expert.

Under the alternative proposals that the committee voted on, 20 percent of renewable transport fuels would have to come from feed stocks, like algae, that do not compete with food for cropland. EU nations also could meet the target by expanding the use of vehicles powered by biogas, electricity or hydrogen by 2015.

The European Commission has denied that biofuels are helping push up world food prices by displacing other agriculture and has vowed to stick by its 10 percent goal.

Michael Mann, a spokesman, said Monday that higher food prices had been caused by increased demand for meat and dairy products, particularly in China and India, two years of bad harvests around the world, speculation, and restrictions on exports.

Originally published by The New York Times Media Group.

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