In response to climate change and unsustainable energy consumption, the European Parliament launched a climate and energy package in 2009. This included the 20:20:20 Energy Strategy aimed at decreasing the effects of climate change, in particular by lowering greenhouse gas (GHG) emissions by 2020. This 10-year action plan proposes measures to increase the current efficiency levels of energy use and raises the share of renewable energies within the energy mix for all 27 EU Member States. As a result the increased use of biofuels, particularly in the transport sector, will be an important part of a more complex framework. Although biofuels represent only two per cent of total transport fuels used, political incentives, technology and efficiency improvements could increase this by eight per cent in Europe by 2020.
In line with the 20:20:20 Strategy, the Renewable Energy Directive (RED) was introduced to regulate the overall biofuel market, amongst others. Based on the RED’s definition of sustainability, different certification schemes emerged, aimed at creating a uniform biofuel standard within Europe. At present, the overall scale and scope of environmental and social impacts associated with the biofuel supply chain are not well defined and this will be evaluated within this thesis. Furthermore, close ties between the biofuel supply chain and other sectors including food and crude oil industries lead to associations with issues such as deforestation, pollution and food supply shortages. Thus, this thesis will analyse whether RED actually supports such a low-carbon pathway or it mainly supports the local industry. As such, the RED has been critically regarded as a market protectionist mechanism for the European agricultural and biofuel industry against the comparatively more competitive biodiesel imports from Argentina and Indonesia. Finally, the EU set a tone with its Directive, encouraging international collaborations with other governments to work towards sustainable energy measures as part of a universal climate change solution.
Table of Contents
1. Introduction
1.1. Motivation and research objective
1.2. Methodological approach
1.3. Structure of the thesis
2. The Renewable Energy Directive (RED)
2.1. Background on the RED 2003/30/EC on commodity and biofuel trade
2.2. The Renewable Energy Directives 2009/28/EC and 2009/30/EC
3. The biofuel industry
3.1. An overview of the biofuel industry and its players
3.2. The biodiesel value chain and different types of feedstock
3.3. Feedstock production, crushing plant and oil production
3.4. Biofuel production and chemical background of transesterification
3.5. Trade flows and concrete example of a Supply Chain Manager
3.6. GHG emissions as main sustainability criteria for biodiesel
3.7. Criticism on criteria regarding GHG emissions and biodiversity
3.8. Crop rotation and Genetically Modified Organism
3.9. Direct (DLUC) and indirect land use change (ILUC)
4. Political frameworks and incentives for the biofuel industry
4.1. Argentinian’s export tax driven biodiesel industry
4.2. Splash and Dash - a US case study on import and tariffs
4.3. Sustainability certificates and voluntary schemes – 2BSvs case study
4.4. Criticism on sustainability schemes
4.5. An outlook into second and third generation biofuels
4.6. Price increases and price volatility cause food shortage and hunger
5. Conclusion
Objective and Core Themes
This thesis examines the implementation of the European Renewable Energy Directive (RED) and its impact on the global biodiesel industry. The central research question explores whether the RED effectively supports a low-carbon energy transition or if it primarily acts as a market protectionist mechanism for the European biofuel industry against more competitive imports from countries like Argentina and Indonesia.
- Analysis of the biofuel supply chain and the role of major industry players.
- Evaluation of political frameworks, subsidies, and trade incentives for biofuels.
- Investigation of sustainability criteria, including GHG emissions and land use change (ILUC).
- Case study of certification schemes (specifically 2BSvs) in the context of global trade.
- Assessment of the correlation between biofuel production, food price volatility, and global hunger.
Excerpt from the Book
3.4. Biofuel production and chemical background of transesterification
Biofuels are produced in two phases. First there is the cultivation of feedstock by conventional agricultural production as well as the extraction of either vegetable oil via crushing and extraction plants or the fermentation of sugars. Second, after having the raw material, it is converted to biofuel in a refinery, whereas in the case of biodiesel via transesterification and for bioethanol through a distillation processes.
After crushing the oil seeds physically and separating the hulls from the meal that is pressed in into flakes, a chemical solvent is used, as for instant, hexane to extract the oil from the soybean flakes. Usually, the soybeans are cracked, checked for moisture content, pressed into flakes and then treated with hexane as the chemical solvent within the extraction process. The resulting crude soybean oil product is degummed, refined, blended depending on what kind of application and in some cases hydrogenated. The SBM, the larger part of the production, is sold as animal feed. After the extraction of the oil, the valuable hexane will be separated again from the oil in order to be reused. Then, methanol is added in order to chemically react with the oil to generate biodiesel and glycerine. Finally, there must be only a separation of the two by-products to isolate the biodiesel. After the crush and oil extraction, the vegetable oil is converted into biodiesel within the biodiesel plants in which the high viscosity of vegetable oils are reduced in order to use the fuel in common diesel engines without operational difficulties. Of the four common practices to decrease viscosity, namely blending with petro diesel, pyrolysis, micro emulsification, and transesterification only the last one is appropriate for biodiesel production.
Summary of Chapters
1. Introduction: Presents the global challenges regarding resources and climate change, establishing the context for biofuel promotion as a political response.
2. The Renewable Energy Directive (RED): Details the historical background of European biofuel policy and the specific targets set by the 2009 Directives.
3. The biofuel industry: Provides an overview of the industry players, the biodiesel value chain, feedstock production, and technical aspects like transesterification and GHG emission criteria.
4. Political frameworks and incentives for the biofuel industry: Analyzes diverse political interventions including tax incentives, mandates, sustainability certification, and the impact on food prices.
5. Conclusion: Evaluates the overall impact of the RED and provides recommendations for a more transparent and sustainable future development.
Keywords
Renewable Energy Directive, RED, Biodiesel, Biofuel, Sustainability, Supply Chain Management, GHG emissions, Certification, Transesterification, Land Use Change, ILUC, Food Security, Commodity Trading, Feedstock, 20:20:20 Strategy
Frequently Asked Questions
What is the primary focus of this research?
The work focuses on the effects of the European Renewable Energy Directive (RED) on the global biodiesel supply chain and the challenges it creates for producers and international trade.
What are the main thematic areas covered?
Key areas include the regulatory framework of the EU, the technical production processes of biodiesel, the global trade flows of oilseeds, the role of sustainability certification, and the socioeconomic impact on food markets.
What is the central research question?
The study analyzes whether the RED truly promotes a low-carbon energy path or if it functions as a protectionist tool for the European agricultural sector.
Which scientific methodology is employed?
The thesis is based on fundamental theoretical research of industry documents, academic literature, and direct professional insights from global commodity trading firms like the Noble Group.
What topics are discussed in the main part of the thesis?
The main part covers the biodiesel value chain, technical production methods, GHG emissions standards, the impact of land use change, and specific case studies on certification and trade tariffs.
Which keywords best characterize this work?
The research is best characterized by terms such as Renewable Energy Directive, biodiesel, sustainability certification, supply chain management, and GHG emission reduction.
How does the author evaluate the "splash-and-dash" trade practice?
The author identifies "splash-and-dash" as a trade distortion where imported biodiesel was blended in the US solely to qualify for tax credits and re-export to the EU, which the EU subsequently countered with anti-dumping duties.
What is the specific role of the 2BSvs certification scheme?
The 2BSvs is analyzed as a French industry-led voluntary scheme designed to demonstrate compliance with RED sustainability requirements through independent auditing of the supply chain.
- Citation du texte
- Markus Beck (Auteur), 2012, The Renewable Energy Directive and the challenges for the Global Biodiesel Industry, Munich, GRIN Verlag, https://www.grin.com/document/200633
