Biofuels Policy in Europe under the Directive 2003/30: An Analysis of Goals, Hindrances, Instruments and Effects

by Augusto Ninni and Pietro Lanzini

Up to 2008/2009, biofuels were considered one of the best alternatives to oil consumption in a captive market like transports, being one of the pillars of the 20-20-20 initiative in Europe. Improvement of security of supply through partial substitution of imported oil; reduction of GHGs emissions; improvement of income and employment in the agricultural and rural sectors were the main drivers of the promotion of biofuels in Europe, as well as in the United States and in Brazil. In the European Union biofuels policy was supported through Directive 2003/30. However its effects proved to be disappointing: the consumption of biofuels was expected by the Directive to account for 5.75% share of road fuels in 2010 in the European MSs, but it came early clear that such a target could not be met. Above all, consensus about biofuels decreased sharply when their ability to strongly decrease overall GHGs emissions was questioned, and when they were blamed of being the main responsible of the 2007-2008 food price increase. Finally, a new Directive was approved on April 23rd, 2009, including the request of various certifications to prove the sustainability of biofuels. The paper deals deeply with the biofuel experience in Europe, providing a general analysis of the 2003/30 Directive. It includes an evaluation of the difficulties met in satisfying the requested targets, an assessment of the MSs policies to support biofuels, and a discussion about the main features of the (failed) birth of a new industry.