European Biodiesel Board proposes RED-verification reform to combat fraud

In its continued effort to tackle biofuel fraud, the European Biodiesel Board published what it called “an elaborate and ambitious proposal” revising the rules on sustainable biofuels verification.

The trade association, representing EU producers of biodiesel and renewable diesel from all feedstocks, is suggesting changes in order to make the verification system more robust and create a level-playing field with economic operators outside the EU.

“The surge of imports from Southeast Asia from 2022 onwards, leading to the collapse of the EU market, has raised serious concerns in the industry on the compliance of some imports with the criteria of the Renewable Energy Directive (RED),” EBB stated. “These suspicions are sustained by the abnormal increase in both biodiesel production and waste feedstocks availability. Ever since EBB became vocal on the issue, more and more stakeholders have joined the call for action. Members states at the Energy Council meeting on May 30, 2024, called on the commission to develop ‘strong corrective actions to prevent the entry of fraudulent biofuels on the European market.’ A leading environmental NGO in the field of transport jumped on the bandwagon requesting action, and Indonesia and Malaysia are taking measures to prevent tax fraud with exported palm-oil waste feedstocks.”

Reevaluating the rules

The European Commission is now reevaluating the set of verification rules that govern biofuels in the EU market.

The 30-page EBB document, which was made public Feb. 20, includes detailed amendments to EU rules that can be implemented immediately.

Notably, the document stresses that rules that apply to domestic producers should be enforced just as strictly outside of the EU for biofuels used in the EU market.

For example, EBB said on-site audits should be systematic in production facilities outside the EU, as is already the case in Europe.

As a precondition for biofuels to count towards the RED target, the paper also proposes that member states authorize for every producer the quantities, capacities and feedstock-use of biofuels produced from raw materials listed in Annex IX, which EBB pointed out is already the case in some countries.

Building on the Union Database for Biofuels, the association suggested including additional information and documents, allowing for better verification.

The paper also insists on tougher sanctions on noncompliance, and that the withdrawal of certificates in the case of noncompliance should have retroactive effects, making sure that only truly sustainable biofuels contribute to RED objectives.

“We are aware that the ambitious reform we are proposing will require more effort and more resources from EBB members, the industry at large, the verification schemes, member states and the commission, but it is the price to pay,” said Xavier Noyon, EBB’s secretary general.

“Fraud is an existential threat for our industry, for the functioning of RED verification and for the EU climate ambitions,” he added.

Click here to read the full proposal.