EU green fuels talks slowed by detail

Spanish Market: Biofuels, Natural gas, Oil products
29/11/21

EU energy ministers will meet this week to try and clear stumbling blocks — notably over targeted levels — in legislation aimed at boosting uptake of renewable fuels, including sustainable aviation fuels (SAFs) and maritime fuels with a lower greenhouse gas (GHG) intensity.

Member states had aimed for a common position on the proposals before the end of this year, which would have allowed ministers to press the European Parliament to open talks for a final legal text. But energy ministers are now only expected, on 2 December, to take note of their differences.

Chairing discussions, Slovenia would like ministers to give political "guidance" to member state experts on the "ambition" for SAFs, maritime fuel GHG reductions and, more generally, targets for renewable fuels.

For maritime fuels, member states "largely agree" with the objectives but call for "more time" to examine it properly. And countries are divided on the level and timing of the SAF blending mandates as well as SAF feedstocks. For maritime fuels, the GHG reduction targets are a stumbling block, accompanied by discussions about on-shore power supply requirements, penalties and the geographical scope. Further questions are whether to mandate GHG emission cuts for all ships above a gross tonnage of 5,000t, as well as which fuels to include and how to count these towards GHG intensity reduction targets.

Some agreement has been achieved on less contentious issues, for instance allowing member states to oblige operators to uptake SAF blends at smaller airports, catching more aircraft operators under the blending obligation and defining "yearly" aviation fuel and compliance demonstration by fuel suppliers.

Legal proposals were made by the European Commission, in July, to phase maritime transport emissions into the EU ETS from 2023 to 1 January 2026 and mandate a reduction in the GHG intensity of marine fuels. Ships should reduce their average GHG intensity of the energy used on board by 6pc by 2030, by 49pc by 2050 and by 75pc by 2050, all from 2020 levels.

For SAFs, the commission wants aircraft landing at EU airports to uptake fuel with a 2pc SAF blend by 2025, 5pc by 2030, 20pc by 2035, 32pc by 2040 and 63pc by 2050. From 2030, the 5pc SAF target to be composed of a minimum share of 0.7pc of synthetic aviation fuels or aviation-certified renewable fuels of non-biological origin (RFNBOs), rising to 5pc synthetic aviation fuels from 2035, 8pc from 2040 and 11pc in 2045.

Discussions on SAFs and maritime fuels have hosted similar reservations to those on an overarching revision of the EU's 2018 renewables directive (RED II), which proposes an EU target share of least 40pc renewable in EU gross final consumption of energy by 2030, aligning climate and energy legislation with the bloc's 55pc emissions-reduction target.

Beyond the level of ambition, Slovenia, while chairing discussions, has noted "several" states are against sub-targets for industry, notably the indicative 1.1 percentage point annual increase and a sub-target for RFNBOs. Similarly, energy ministers are divided over the indicative 1.1 percentage point increase in heating and cooling.

Renewables in transport is also contentious, with the 13pc GHG intensity reduction target for transport fuels seen as "too ambitious" for some states. And countries are divided over whether to shift the renewable transport target, currently a 14pc share of energy used in transport by 2030, to a GHG reduction target. Slovenia notes a "majority" of countries have reservations on increasing the sub-targets for advanced biofuels to at least 0.2pc in 2022, 0.5pc in 2025 and 2.2pc by 2030. Similarly, there is no enthusiasm for the proposed new 2.6pc sub-target for transport RFNBOs.

By Dafydd ab Iago

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28/02/25

Trader curbs US-Canada gas trade on tariff risk

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Energy a priority for Uruguay’s new government

28/02/25

Energy a priority for Uruguay’s new government

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Low flood risk expected for upper Mississippi River

28/02/25

Low flood risk expected for upper Mississippi River

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Muted Norwegian gas flows in Jan-Feb follow forecast

28/02/25

Muted Norwegian gas flows in Jan-Feb follow forecast

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Weak demand weighs on Singapore bio-bunker prices

28/02/25

Weak demand weighs on Singapore bio-bunker prices

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