Assessing Effectiveness of European Biofuel Sustainability Criteria

Abstract

The European Union has recently imposed sustainability criteria on biofuel production to avoid negative impacts of its renewable energy targets on the environment. In this article we analyse the effectiveness of RED sustainability criteria in ensuring GHG mitigation and preventing negative impacts on biodiversity. For this purpose, we use the GLOBIOM model and run a shock of demand for biofuel following the EU member states NREAP commitments. In an ex-post calculation we determine the sustainable production according to RED. We show that restricting sustainability criteria only on biofuel production does not result in a more sustainable production, since the major share of production is classified sustainable according to RED anyway. Unsustainable production is shifted to the food and livestock sector where sustainability criteria are not applied. This finding clearly illustrates the incapacity of the RED sustainability criteria to address indirect land use change issue. If expansion of biofuels shall not violate sustainability criteria, they need to be implemented targeting any agricultural production activity and be adopted by a larger group of countries to be effective.

Last edited: 04 October 2012