The Renewable Energy Directive and the challenges for the Global Biodiesel Industry

Table of Contents

1. Introduction

1.1. Motivation and research objective

1.2. Methodological approach

1.3. Structure of the thesis

2. The Renewable Energy Directive (RED)

2.1. Background on the RED 2003/30/EC on commodity and biofuel trade

2.2. The Renewable Energy Directives 2009/28/EC and 2009/30/EC

3. The biofuel industry

3.1. An overview of the biofuel industry and its players

3.2. The biodiesel value chain and different types of feedstock

3.3. Feedstock production, crushing plant and oil production

3.4. Biofuel production and chemical background of transesterification

3.5. Trade flows and concrete example of a Supply Chain Manager

3.6. GHG emissions as main sustainability criteria for biodiesel

3.7. Criticism on criteria regarding GHG emissions and biodiversity

3.8. Crop rotation and Genetically Modified Organism

3.9. Direct (DLUC) and indirect land use change (ILUC)

4. Political frameworks and incentives for the biofuel industry

4.1. Argentinian’s export tax driven biodiesel industry

4.2. Splash and Dash - a US case study on import and tariffs

4.3. Sustainability certificates and voluntary schemes – 2BSvs case study

4.4. Criticism on sustainability schemes

4.5. An outlook into second and third generation biofuels

4.6. Price increases and price volatility cause food shortage and hunger

5. Conclusion

Objective and Core Themes

This thesis examines the implementation of the European Renewable Energy Directive (RED) and its impact on the global biodiesel industry. The central research question explores whether the RED effectively supports a low-carbon energy transition or if it primarily acts as a market protectionist mechanism for the European biofuel industry against more competitive imports from countries like Argentina and Indonesia.

• Analysis of the biofuel supply chain and the role of major industry players.
• Evaluation of political frameworks, subsidies, and trade incentives for biofuels.
• Investigation of sustainability criteria, including GHG emissions and land use change (ILUC).
• Case study of certification schemes (specifically 2BSvs) in the context of global trade.
• Assessment of the correlation between biofuel production, food price volatility, and global hunger.

Excerpt from the Book

Summary of Chapters

1. Introduction: Presents the global challenges regarding resources and climate change, establishing the context for biofuel promotion as a political response.

2. The Renewable Energy Directive (RED): Details the historical background of European biofuel policy and the specific targets set by the 2009 Directives.

3. The biofuel industry: Provides an overview of the industry players, the biodiesel value chain, feedstock production, and technical aspects like transesterification and GHG emission criteria.

4. Political frameworks and incentives for the biofuel industry: Analyzes diverse political interventions including tax incentives, mandates, sustainability certification, and the impact on food prices.

5. Conclusion: Evaluates the overall impact of the RED and provides recommendations for a more transparent and sustainable future development.

Keywords

Renewable Energy Directive, RED, Biodiesel, Biofuel, Sustainability, Supply Chain Management, GHG emissions, Certification, Transesterification, Land Use Change, ILUC, Food Security, Commodity Trading, Feedstock, 20:20:20 Strategy

Frequently Asked Questions

What is the primary focus of this research?

The work focuses on the effects of the European Renewable Energy Directive (RED) on the global biodiesel supply chain and the challenges it creates for producers and international trade.

What are the main thematic areas covered?

Key areas include the regulatory framework of the EU, the technical production processes of biodiesel, the global trade flows of oilseeds, the role of sustainability certification, and the socioeconomic impact on food markets.

What is the central research question?

The study analyzes whether the RED truly promotes a low-carbon energy path or if it functions as a protectionist tool for the European agricultural sector.

Which scientific methodology is employed?

The thesis is based on fundamental theoretical research of industry documents, academic literature, and direct professional insights from global commodity trading firms like the Noble Group.

What topics are discussed in the main part of the thesis?

The main part covers the biodiesel value chain, technical production methods, GHG emissions standards, the impact of land use change, and specific case studies on certification and trade tariffs.

Which keywords best characterize this work?

The research is best characterized by terms such as Renewable Energy Directive, biodiesel, sustainability certification, supply chain management, and GHG emission reduction.

How does the author evaluate the "splash-and-dash" trade practice?

The author identifies "splash-and-dash" as a trade distortion where imported biodiesel was blended in the US solely to qualify for tax credits and re-export to the EU, which the EU subsequently countered with anti-dumping duties.

What is the specific role of the 2BSvs certification scheme?

The 2BSvs is analyzed as a French industry-led voluntary scheme designed to demonstrate compliance with RED sustainability requirements through independent auditing of the supply chain.