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ASA calls for extension of $1 biodiesel tax credit

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Volume 5, Issue 1

Feature: No resolve for New Year
Right before the Christmas holidays the European Commission published its report on indirect land-use change (ILUC) of biofuels. The Commission concluded – after a series of stakeholder meetings, two public consultations and several economic modelling studies – that ILUC of biofuels is far from obvious and that further studying would be required. Models still uncertain ILUC is a phenomenon that cannot be directly observed or measured and its effects thus need to be estimated through modelling. The Commission therefore looked at various models and their results to get a clearer view on ILUC impacts of biofuels. However, the Commission came to the conclusion that several deficiencies and uncertainties remain in the models and need to be addressed. To give an example, none of the models scrutinised by the Commission include the effects of animal feed production, yield increase and the use of idle or abandoned agricultural land—to name just a few highly important variables. For example, in the EU year-on-year, there is a growing area of agricultural land being abandoned. All of the models that were presented to the European Commission ignored the combined effect of these realities, and none looked at historical data. Including these elements into the models will have a significant impact on the model results. The Commission hence decided that it will need to conduct further work in this respect to be able to base its policy on best available science. However, the Commission does not seem to be extremely confident that they will be able to find good enough science. How else – than with a lack of confidence – can it be explained that the Commission recommends considering any ILUC action in light of the precautionary principle? Isn’t the raison d’être for the precautionary approach precisely a considerable degree of (scientific) uncertainty? If science is good enough to be used as a basis for regulation then there should not be a need for the precautionary principle anymore. Further actions The Commission is currently finalising its impact assessment, which it will present by July 2011 at the latest.


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