The European Union stepped up calls for sustainability in biofuels production on Thursday, indicating it may apply strict environmental standards to both importers and domestic producers.
"Europeans won't pay a premium for biofuels if the ethanol in their car is produced unsustainably by systematically burning fields after harvests. Or if it comes at the expense of rainforests," EU Trade Commissioner Peter Mandelson told an international conference on biofuels in Brussels.
"This is why we have argued for putting in place sustainability schemes in the European Union and elsewhere to pull producers towards more durable production methods — these rules would apply to importers and domestic producers," he added.
Environmentalists are concerned about the rapid expansion of biofuels production to meet the global energy need. Though biofuels are considered as an important source of green energy, the potential profit is driving its production in a way destructive to the environment, sometimes at the expense of arable land and rainforests.
"We can't allow the switch to biofuels to become an environmentally unsustainable stampede in the developing world," Mandelson said, adding that such a policy would be self-defeating.
The EU member states agreed in March that at least 10 percent of vehicle fuels should come from biofuels by 2020, in an effort both to diversify its energy supplies and to fight climate change.
Mandelson said Europe will import a large part of biofuel resources in order to realize the goal.
"Even if it theoretically is possible, it is unlikely that our 10 percent target for biofuels in the EU's energy mix could be met without wider sourcing from imports," the EU trade chief said.
Mandelson urged that the EU should simply base its biofuels trade policy on the environmental outcome, without prejudice against foreign exporters.
But his comment may not be welcome by EU countries like France, which is traditionally a strong supporter of providing subsidies to farmers in order to protect its agriculture industry.
Currently, oilseed crops in Europe are heavily subsidized, making them much cheaper than imported Brazilian ethanol, which faces high tariffs of around 70 percent, though Brazilian ethanol made from sugar cane is cleaner than biofuels made from oilseeds.
Mandelson's call came one day after a UN report warned the global increasing demand for biofuel resources may help drive food prices up in the next decade as high as nearly twice.
Last year more than a third of the total U.S. maize crop went to ethanol for fuel, a 48 percent increase from 2005. During the ten year period from 2006 to 2016, the U.S. output of maize-based ethanol output is expected to double and the amount of oilseeds used for biofuels in the EU is also set to be twice more.
The UN report said the switch to growing fuel crops will take land out of food production and increase the price of commodities such as sugar, maize and palm oils, threatening poor countries who already depend on food imports.
At the same conference, the European Commission President Jose Manuel Barroso also said the EU will work with all trading partners to work towards globally agreed sustainability criteria to open up a credible and sustainable international market of biofuels.
"The European Commission will lead international efforts to ensure the sustainable production and consumption of biofuels. This means setting up a rigorous sustainability mechanism to underpin a new market for these products," he said.
Barroso said the Commission is already actively working on the definition of an EU scheme, designed to encourage the use of sustainably produced biofuels and discourage damaging production, and the scheme will respect multilateral rules.
Visiting Brazilian President Luiz Inacio Lula da Silva, who was also present at the two-day conference, called for the opening of markets for biofuels, arguing that they can be a development tool.
"Biofuels will make nations more independent," Lula told reporters in Brussels after talks with Barroso.
Today, the world relies on just 20 countries for oil production, said Lula. With biofuels, more than 100 countries will be able to be energy producers.
"So we will have a much better distribution of opportunities for the rest of the world," he said.
Lula said his country, a world leader in biofuels production, is very close to agreement with the EU on the environmental standards on biofuels.
The two sides, together with other countries, are set to create an International Biofuel Forum, which will serve as a platform for further discussions.
