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Sustainability certifications 'not fully reliable' says EU court

A recent report from an EU court says achievement of the 10 percent transport target may be questionable as statistics might be overestimated because member states could report biofuels as sustainable when its sustainability was not verified
By Ron Kotrba | August 10, 2016

Germany’s Union for the Promotion of Oil and Protein Plants issued a compelling press release this week in response to the European Court of Auditors’ report on the unreliability of sustainability certification schemes and their need for improvement.

In summary, the court report concluded that, “Because of weaknesses in the Commission’s recognition procedure and in the subsequent supervision of voluntary schemes, the EU certification system for the sustainability of biofuels is not fully reliable. As regards the achievement of the 10 percent transport target, we found that the statistics might be overestimated, because member states could report as sustainable biofuel whose sustainability was not verified.”

Here’s what UFOP had to say.

In the report published last week, The European Court of Auditors observed considerable room for improvement in the monitoring of the voluntary certification systems approved by the EU Commission. In its evaluation, the court criticizes the fact that the EU Commission only approves the certification systems on the basis of a “file inspection,” but does not monitor them in terms of their actual function. Since the EU Commission has also approved the systems without checking whether they include complaints procedures, there is also no formal procedure for investigating any infringements.

In the view of UFOP, the report highlights the fundamental problem that the member states are only in favor of approving the certification bodies and in favor of the statistical recording of the sustainably certified biofuels. Should deficiencies be identified in the implementation of a certification system, the responsible body cannot refuse to credit the biofuel quantity. The court also criticised the inadequate review process, which is nevertheless approved by the EU Commission, for the production of biofuels from waste material, which can be credited in duplicate on the quota obligation. This is another example of consent to inadequate control quality by the certification systems. UFOP notes that this causes considerable competition distortions and warpages in the biodiesel market. According to the court, the EU Commission only published a message about the systems to improve the traceability of raw waste materials as far back as the countries of origin following pressure from the European biodiesel industry, although the message was nonlegally binding. In view of more than 0.5 million tons of biodiesel based on waste oil, which were only credited on the energetic quota obligation in Germany in 2014 (Source: Evaluation report of BLE), UFOP questions where these waste oil quantities could have come from. In addition, the court also critically noted that the statistical recording by the member states is insufficient and it is therefore doubtful whether the targeted 10 percent of renewable energies in 2020 can be achieved with statistical verification.

UFOP generally supports the sustainability certification on the basis of voluntary systems, since the business circles concerned must then take responsibility for determining the test criteria across all levels of production and, based on the legal requirements of the Renewable Energies Directive, must also implement these operatively. The EU Commission’s task here is to ensure that no warpages or competition distortions arise from a “system hopping” of the companies to be certified by means of appropriate system monitoring. According to UFOP, the EU Commission and also the policy must recognise at this point that the systems can also enforce sustainability requirements in third countries on the legal basis of the European Directive if the biomass raw materials or biofuels produced from these are exported into the EU for the final intended purpose for crediting on quota obligations. In light of this, the court’s criticism of the EU Commission, that the minimum requirements of the social standards are not sufficiently observed by all systems with the consequence that companies to be certified are able to switch to a system with a lower level of requirements, is justified.

UFOP bemoans that the EU Commission does not tighten the requirement here for the purpose of creating a “level playing field.” Social and environmental dumping must not be concealed by a sustainability certification, but UFOP requests that the system requirements for the best practice examples be aligned in this regard in the current reapproval process. Referring to the annual evaluation report to be provided by the Federal Office for Agriculture and Food (BLE - Bundesanstalt für Landwirtschaft und Ernährung) as an example of transparent documentation, UFOP calls for a similar coverage to be implemented in all member states as part of the public acceptance improvement. The organization emphasizes that this form and quality of coverage is also exemplary for the coverage for the entire bioeconomy for material or energetic use of biomass. In the light of the climate protection targets agreed in December 2015 in Paris and now anchored in international law, this quality of implementation is required in order to be able to also eventually calculate or quantitatively verify greenhouse gas reduction effects.

However, regarding the court’s “iLUC” criticism, UFOP also emphasizes its support of the response of the EU Commission, which is also published in the report. Indirect changes in land use cannot be an object of the review by systems or certification bodies. Here, the court must understand that, for methodical reasons, it is not currently possible and won’t be possible in future to assign a defined sustainably certified rapeseed oil methyl ester quantity to an equally defined quantity of deforestation for palm oil production. A certification is based on facts that can be reviewed—a certification does not “speculate or interpret,” emphasizes UFOP.

Is this just one more creative way for Europe to discount the validity of biodiesel’s environmental qualities as we have seen in recent times (see Europe continues to get biodiesel wrong), this time through the certification schemes that validate its sustainability? Or are there legitimate deficiencies in these approaches that must be corrected? What improvements can be realistically made to these certifications without overcomplicating or overpricing their services?  

To readers of my FAME Forum blog and Biodiesel Magazine, I’m interested in hearing your views on this, particularly those of you from across the pond in Europe, and specifically those of you who work in the sustainability certification business.