Brussels and US deal will bring huge expansion in biodiesel

The EU and America are expected to agree early next month international standards for trading biofuels that could see a huge expansion in the global market for alternative sources of power such as jatropha, senior US diplomats said yesterday.

C Boyden Gray, US ambassador to the EU, said he expects the two sides to signal the adoption of “pretty firm” international standards at a meeting of the new Transatlantic Economic Council (TEC) in Washington on November 9. These could be fully adopted by the end of the year.
The agreement would be a significant boost to efforts by biodiesel producers such as D1, chaired by former Shell chairman Lord Oxburgh and partnered by BP, to refine thousands of tonnes of oil produced from the seeds of the jatropha curcas grown in poor, dry soil in Africa and the Caribbean as well as India.

Last month D1 cut back its expansion plans, including an increase in refining capacity at a Merseyside plant to 320,000 tonnes by the end of 2008, because of subsidised imports of soya-based biodiesels from the US. The European Biodiesel Board, a trade group of EU producers, has threatened legal action over the $1 a gallon subsidies for biodiesel. US exports to the EU have soared from 90,000 tonnes in 2006 to 700,000 tonnes so far this year. The EU has set a target of 10% use of biofuels by 2020 as part of its campaign to reduce greenhouse gas emissions by at least 20%. Mr Gray accused the EU in turn of precluding other feedstocks for biofuel in favour of rapeseed oil – prompted, he claimed, by the German farming lobby.

The Guardian (London)