Development of sustainability criteria and certification systems for biofuels

In the past years, increasingly requirements are being imposed (or considering being imposed) on either a) feedstocks (such as palm oil) or b) final products that relate to non-product-related processes or production methods (PPMs). The different standards and regulations under consideration are discussed in more depth by van Dam et al (2008) but can be summarized in three categories:

1. Private-sector standards, which are promulgated by non-governmental bodies and are strictly speaking voluntary. Examples for wood pellets are the Green Gold Label by Control Union, or the Electrabel label by Electrabel (van Dam et al. 2008). For bioethanol, the ‘verified sustainable ethanol initiative’ launched by Sekab and UNICA is a clear example of a voluntary industry standard. Other initiatives that should be mentioned are the Roundtable on Sustainable Palm Oil (RSPO) and the Roundtable on Responsible Soy (RTRS) (see van Dam et al. 2008 for an overview).

2. Government voluntary standards, which are often implemented in connection with positive labels, and are intended to reward (through the higher prices expected to be paid by concerned consumers) performance beyond the norm. However, at the moment no such systems are known for solid or liquid biofuels.

3. Regulations linked to tax exemptions or subsidies, which make eligibility to benefit from a government support measure or similar policy contingent on satisfying particular criteria, or linked to achievement of a domestic policy goal, which make attainment of a domestic policy goal — e.g., meeting a sector-specific greenhouse-gas emission reduction target — dependent on certification of regulations or some stage in an imported product’s production or processing. Examples for liquid biofuels are the RTFO in the UK, the German Biofuel Quota Law, and the European discussion on the draft fuel quality directive and the RES directive (see van Dam et al. 2008 for an overview). For wood pellets, for example Walloon authority imposes that each supplier undergoes an audit within 6 months for certification of imported biomass, which examines the sustainability of the wood sourcing as well as detail of the energy balance (through an energy audit including GHG emissions) of the whole supply chain.

Regarding the development of sustainability criteria and certification systems, two main barriers may be distinguished:

1) Criteria regarding especially environmental and social issues could be set (extremely) stringent. The fear of many developing countries is that by formulating too strict criteria, effectively only industrialized countries may be able to meet them, thus these criteria may act as trade barriers. Many developing nations therefore view attempts to introduce sustainability criteria as a form of "green imperialism". Stakeholder interests are extremely diverse, ranging from purely commercial aims to rainforest protection, banning the use of genetically modified crops or preventing child labor. There is a danger that a compromise on the one hand could result in overly detailed rules that lead to compliance difficulties, or on the other hand in standards so general that they become meaningless. Other limitations on the implementation of biomass certification may include small stakeholders’ limitations to implement the requirements, and high cost of certification.

2) The second issue is the possible proliferation of different technical, environmental and social sustainability standards for biofuels production. With current developments by the EU, different European governments, several initiatives of private parties, initiatives of round tables and NGO’s there is a very real risk that on the short term a multitude of different and partially incompatible systems will arise. If they are not developed globally (with the participation of both industrialised and developing countries) or without clear rules for mutual recognition – such a multitude of systems could potentially become a major barriers for international bioenergy trade. Fortunately, the fact that countries and non-governmental organizations seem to have acknowledged these types of potential problems early suggests that some of barriers created by national regulation of organic product standards may be avoided in the case of biofuels. Encouragingly, the EU, for one, has expressed its intention to apply its proposed system of certificates in a non-discriminatory way to domestically produced biofuels and imports.

All references and a description of all barriers can be found in this working paper [231 KB] .