While biofuels are important in helping the EU meet its greenhouse gas reductions targets, biofuel production typically takes place on cropland which was previously used for other agriculture such as growing food or feed. Since this agricultural production is still necessary, it may be partly displaced to previously non-cropland such as grasslands and forests. This process is known as indirect land use change (ILUC).
Indirect land use change risks negating the greenhouse gas savings that result from increased biofuels because grasslands and forests typically absorb high levels of CO2. By converting these land types to cropland, atmospheric CO2 levels may increase.
New rules to reduce indirect land use change
To reduce the risk of indirect land use change, the European Commission has proposed amending the current legislation on biofuels, specifically the Renewable Energy Directive and the Fuel Quality Directive. The proposed new rules seek to ensure that:
- biofuels from new installations emit at least 60% less greenhouse gases than fossil fuels (the current requirement is 35%)
- emissions that might be caused by indirect land use change must be included in the reporting of fuel providers and EU countries. This will be done by estimating emissions that would take place globally when land is used for growing crops for biofuels to be used in the EU instead of growing food and feed crops (estimated ILUC emission values)
- Only half of every EU country's 10% renewable energy target in the transport sector can be met by first generation biofuels (produced from sugars, oil crops, etc.) At the same time, 2nd and 3rd generation biofuels will count more. These biofuels are produced from materials (municipal waste, algae, etc.) that do not compete with food and feed crops
- after 2020, governments would financially support only 2nd and 3rd generation biofuels