Renewable Fuels Agency issues first interim quarterly report on use of biofuels in the UK

07 Oct 2008

Renewable Fuels Agency issues first interim quarterly report on use of biofuels in the UK

The Renewable Fuels Agency (RFA) today (07/10/08) releases its first interim quarterly report which includes disclosure of company performance on the supply of biofuels under the Renewable Transport Fuel Obligation (RTFO).

In the year to April 2009, fossil fuel companies¹ were obliged to supply 2.5% biofuel in UK road fuel. Biofuels accounted for 2.61% in the first quarter. More biodiesel (84%) has been supplied than bioethanol (16%).

The target for sustainability (i.e. meeting a qualifying environmental standard) is 30% over the reporting year. Currently, 20% of biofuels meet these standards². 97% of the fuel reported as coming from UK feedstocks met environmental sustainability standards.

The carbon reduction achieved by the use of biofuels (44%) during the first three months of the obligation is greater than the 40% target set by the Government for the first year of the RTFO.

The savings reported exclude any emissions from indirect changes in land-use as considered in the Agency's 'Gallagher Review' (July 2008). The Agency has recommended that indirect effects are included in future sustainability reporting and is working with the Government and experts to identify a way to accurately reflect this.

The Government has also set a target that companies should report 50% of the data required by the RFA in four categories - feedstock, country of origin, sustainability standard met and land-use change. In this quarter, 61% of data was reported. The feedstock is known for 95% of biofuels. Both the feedstock and country of origin are known for 72%. The most widely reported biodiesel feedstock was American soy (25% of all biodiesel). The most widely used bioethanol feedstock was Brazilian sugarcane (74% of all bioethanol).

The RFA also makes, for the first time, preliminary observations on the performance of the UK's major fuel suppliers.

Almost all are either achieving or are close to achieving carbon savings in line with the Government's target for 2008-09. Harvest Energy, Greenergy, Mabanaft and Shell exceed the target.

Although ConocoPhillips report a negative carbon saving, and Chevron report very low carbon savings³, these may be revised during the auditing process⁴.

Harvest Energy and Mabanaft are exceeding the current sustainability target⁵. However, several companies (BP, Esso, Murco, Prax and Topaz) have so far failed to report any biofuels as meeting the qualifying environmental standard. Of these, Prax and Topaz have also failed to report the origin of their biofuels.

Esso, Petroplus, Prax and Topaz are currently failing to meet any of the three targets set by Government.

Nick Goodall, Chief Executive Officer of the Office of the Renewable Fuels Agency (RFA) commented,

"These early figures demonstrate that some companies have risen to the challenge of sourcing biofuels that meet good sustainability standards."

Full datasets for the information referred to in this news release, as provided for within the constraints of the RTFO order, are available at the RFA website.

For further information:

Contact Chris Malins on 020 7944 8454 or 07500 573521 or by email to enquiries@renewablefuelsagency.org.

Explanatory notes

^1. The RTFO applies across the whole of the UK. Refiners, importers and any others who supply more than 450,000 litres of fossil-based road transport fuel annually to the UK market are obligated by it.

^2. In the reports issued in month one and month two, some biofuels were reported as meeting the standards of the Roundtable on Sustainable Palm Oil (RSPO) and Roundtable on Responsible Soy (RTRS), respectively. Neither of these standards were operational at the time that these reports were made. However, as an interim measure in the absence of operational standards, the RFA permits producers that are members of the roundtables to perform their own audits against the criteria and report on that basis. Following ongoing consultation with the RFA, some of the companies that reported RSPO and RTRS fuel have decided to investigate whether the fuel's sustainability can be proved to the level of confidence required by the RTFO. In the meanwhile, they have rescinded the claim that the fuel met the standards in question. This has resulted in a reduction in the amount of fuel supplied in the first two months of the RTFO reported as meeting a qualifying standard. Graphs showing the performance of the obligation to date include this change, which brings the overall percentage for fuel reported as sustainable to 20%. RFA continues to actively engage with biofuels suppliers to ensure the accuracy of reported data, and this example serves to illustrate the challenges involved in meeting the required level of assurance on the provenance of biofuels feedstocks. The RFA makes every effort to ensure the accuracy of data in the monthly and quarterly reports, but the content remains provisional and subject to revision until the opinion of company's independent auditors have been received following the end of the reporting period.

^3. Some of ConocoPhillips' and Chevron's EU-derived rape biodiesel was reported as coming from agricultural grassland, which carries a significant carbon penalty. Both companies are investigating with their suppliers to clarify whether this previous land-use is correct or whether the land was set-aside. Under the RTFO reporting guidelines, set-aside land counts as cropland, which does not carry a carbon penalty. ConocoPhillips have, since the tabulation of the report, produced evidence that the fuels in question were produced on cropland. This would change their overall carbon savings to 41%.

^4. Data comes from monthly reports submitted by fuel suppliers to the RFA. The RFA performs checks on the data, which is also subject to an annual verification process by independent auditors. The RFA will publish a final, fully verified dataset at the end of year.

^5. 30% of feedstocks should meet environmental sustainability standards in the year 2008-9. The ability of suppliers to source certifiably sustainable fuels is currently limited, as the British ACCS scheme is the only qualifying environmental standard that is well established. Certified sustainable feedstock is expected to become increasingly available over time, as feedstock standards develop in response to the demand created by the RTFO and growing concern about the sustainability of agricultural commodities more widely.

Background

The RFA, a Government Non-Departmental Public Body (NDPB), is the UK's independent sustainable fuels regulator.

Smaller biofuel companies that supply little or no fossil fuel, such as those supplying recycled cooking oil, can also claim RTFO certificates. Nearly all of these companies met all three targets.

The initial requirement is for 2.5% of the fuel supplied for road transport in 2008-09 to be biofuel. The RTFO order increases this by 1.25% a year to 5% in 2010/11. The Government is expected to announce a consultation on the rate of increase of the volume target for biofuels under the RTFO.

The European Union is expected to finalise legislation which sets mandatory renewable fuel targets for 2020 early in 2009, including Europe-wide sustainability standards. The UK will need to adapt to the new requirements when they come into force in April 2010. The UK currently has the highest reporting standards in the world.

The Chief Executive of the RFA is Nick Goodall. He was previously CEO of the Energy Networks Association, of Renewables East and of the British Wind Energy Association.