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EU expects to miss a second target for using biofuels

The European Union will probably miss a 2010 target to use more alternative fuels, the second time it will fall short in five years, said Hans van Steen, an EU official in charge of promoting renewable energy.

The EU wants biofuels to account for an average of 5.75% of transport fuel by 2010, Van Steen told the F.O. Licht World Ethanol Conference in Amsterdam today. The EU set a target of 2% for 2005, and member states averaged 1%, he said. Biofuels are made from corn, sugar or vegetable oils. “We can't count on member states getting to where they want to be, based on their previous performance,” said Van Steen, from the renewable energy unit at the European Commission's Energy and Transport Directorate General. The 25-nation EU wants to use less fuel derived from crude oil or natural gas to improve energy security and independence, limit greenhouse gas emissions and support farmers, Van Steen said. Half of all new cars sold in Europe run on diesel, of which there is a shortage, and more than half of greenhouse gas emissions come from transport.

The 2% target was only achieved by Sweden and Germany, Van Steen said. He added in a separate interview that the two countries and France were the only ones likely to meet the 2010 objective. “We need to have a stronger system to judge whether member states are doing enough to reach their goals, but how they do it should be left to them,” he said. “Some member states still question the very use of biofuels, so it's not an easy process.” Van Steen doesn't expect widespread introduction of mandatory fuel blending requirements in the EU in coming years, contrary to predictions by F.O. Licht GmbH and Goldman Sachs Group Inc. Germany is introducing a 2% compulsory blending requirement for ethanol and 5% for biodiesel by 2007. “There is significant resistance among some member states to this,” he said. “The EU imports roughly half of its energy needs and this will increase, probably to as high as 75% by 2020-2025,” he said. “Biofuels help us achieve fuel diversity.” European biodiesel production is forecast to increase almost fourfold to 12 million metric tons by 2010, bolstered by € 2.97 billion ($3.8 billion) of investment, according to Goldman Sachs. The European Commission is scheduled to issue a new report addressing the Union's energy needs and progress on biofuels on Januar 10, Van Steen said. (Bloomberg)