VZCZCXRO3360
RR RUEHAG RUEHDF RUEHHM RUEHIK RUEHKW RUEHLN RUEHLZ RUEHMA RUEHPB
RUEHPOD RUEHROV
DE RUEHBS #0940/01 1711509
ZNR UUUUU ZZH
R 191509Z JUN 08
FM USEU BRUSSELS
TO RUEHC/SECSTATE WASHDC
INFO RUEHZN/ENVIRONMENT SCIENCE AND TECHNOLOGY COLLECTIVE
RUCNMUC/EU CANDIDATE STATES COLLECTIVE
RUCNMEU/EU INTEREST COLLECTIVE
RUCNMEM/EU MEMBER STATES COLLECTIVE
RUEHBR/AMEMBASSY BRASILIA
RUEHRI/AMCONSUL RIO DE JANEIRO
RUEHSO/AMCONSUL SAO PAULO

UNCLAS SECTION 01 OF 03 BRUSSELS 000940 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ENRG EU EUN SENV TSPL
SUBJECT: EUROPEAN PARLIAMENT REMAINS DIVIDED ON 
COMMISSION'S RENEWABLES DIRECTIVE 
 
 
¶1. (U) Summary: This month, the Parliament's Industry (ITRE) 
and Environment (ENVI) committees debated the Commission's 
Renewables Directive launched in January as part of the 3rd 
energy package.  Though the directive covers Europe's 
renewable energy goals for 2020-20% reduction of greenhouse 
gases and a Europe-wide 20% share of renewables-the focus was 
strongly on the biofuels aspect of the directive.  In the 
directive, the Commission calls for 10% of all transport 
petrol and diesel fuels to be replaced by renewables. (Note: 
this aspect is commonly mistaken for a requirement of 10% 
biofuels in the transport sector.  However, this 10% includes 
electric vehicles powered from renewable electricity and 
hydrogen fuel cell powered vehicles. End note.)  Several 
Parliamentarians and the Commission representative, Paul 
Hodson, detailed this discrepancy in focus and expressed that 
there should be more time spent looking at the rest of the 
directive. End summary. 
 
¶2. (U) The Parliament appears to be dividing the directive 
along very clear lines between the two committees.  ITRE is 
expected to focus on the majority of the directive, while 
ENVI will control the biofuels aspect.  However, ITRE, led by 
Greens MEP Claude Turmes, has taken a strong line on 
biofuels, stopping short of discussing the sustainability 
criteria in his formal amendments-this hasn't prevented him 
however, from making comments in the press.  ENVI, led by 
Christian Democrats MP Anders Wijkman, has taken 
responsibility for the sustainability criteria. 
 
¶3. (U) During the ITRE meeting on May 28, Turmes presented 
his proposed amendments to the directive.  His overarching 
message is that the directive is not sufficiently stringent. 
He explained that the EU needs to add interim binding 
objectives, every two years beginning in 2012.  This will 
ensure Europe is on the right track and can make corrections 
if necessary.  However, the directive will only go so far. 
As each Member State has its own target, Turmes believes that 
national measures will contribute 90% of the 2020 goals, and 
the EU needs to more strongly support existing and in process 
measures. 
 
¶4. (SBU) On biofuels, Turmes questioned the 10% target, 
explaining that there needs to be a more rational look.  He 
believes the target should be removed completely, adding that 
it adds an incentive to the use of environment damaging 
biofuels.  Specifically, Europe can't make the same mistake 
as the U.S. corn-based ethanol policy, which not only affects 
wheat prices (no details given) but is also hostile to the 
environment.  Turmes placed most of his focus on the use of 
certain land types, without going into the details of the 
sustainability criteria.  He explained that Europe should 
emphasize use of degraded lands for biofuels.  (Note: 
Germany has a similar idea-provide bonuses and incentives for 
biofuels grown on marginal or degraded lands.  Therefore, 
instead of only penalizing use of previously forested or 
other agricultural land, send a market signal that the 
development of lower quality land will provide benefits.  End 
note.)  Specifically on agricultural land, Turmes explains 
that priority should be given to food.  While he concedes 
that biofuels can't be the sole cause of food prices, he 
believes that biofuels should be tied to agricultural yields 
so that during down years, fewer biofuels are grown. 
 
¶5. (U) During the debate, it became very clear that there is 
no obvious consensus within ITRE for the specifics of the 
directive.  In particular, there was very little support for 
dropping the 10% transport fuels requirement.  Most MEPs 
argued that by dropping the target, they would be sending a 
signal to limit research toward second generation biofuels. 
This discussion instead is a reaction to the newspapers and 
is not grounded in scientific fact.  One MEP in particular 
mentioned that Turmes previously argued that high quotas for 
biofuels were necessary, and it isn't clear why he is 
changing his mind now.  The other major themes in the debate: 
 
  -- Sustainability should be discussed in ITRE.  There is no 
reason why the committee shouldn't be able to discuss a 
portion of the directive.  Most argued that they should keep 
the 10% but that it needs to be tied to stronger 
sustainability criteria, including food prices, water use, 
and land use. 
  -- Binding targets would be very helpful, but there are 
legal questions as to how strict the EU can be.  Several 
questioned whether the EU has the legal basis to levy fines 
 
BRUSSELS 00000940  002 OF 003 
 
 
on underperforming Member States. 
  -- Social criteria need to be explored, including issues 
such as worker conditions.  Most MEPs were in favor of 
including some measure of social criteria. 
 
¶6. (U) In the ENVI debate, Wijkman focused almost exclusively 
on the sustainability criteria.  His strongest point was to 
ensure the greatest GHG reductions en route to elimination of 
fossil fuel use by 2050.  To that end, Wijkman questioned the 
two primary numbers-the 10% target by 2020 and a minimum 
biofuels GHG reduction threshold of 35% over conventional 
fossil fuels.  He explained that he was not convinced Europe 
could reach the 10% target by 2020, and therefore he 
recommended a reduction to 8%.  (Note: this is fairly widely 
accepted by most MEPs, despite the outspoken statements of 
Turmes.  End note.)  In order to compensate for this change 
in target, Wijkman recommended that the 35% threshold be 
increased to 50%.  This is two-fold: 
 
  -- By increasing to 50%, the overall GHG savings for the 8% 
target is improved over 35% saving and a 10% share; and 
  -- Using 50% sends a signal that second generation biofuels 
will be supported in Europe and that work should move quickly 
away from first generation fuels. 
 
¶7. (U) In responding to the recent food price increases, 
Wijkman explained that it is a gross exaggeration the 
increases can be explained by biofuels, with the notable 
exception of corn in the U.S.  There are at least 7-8 reasons 
for the increases globally.  However, there should be a push 
to move away from the use of agricultural lands. There are 
large areas of land globally which should be able to support 
biofuels development, and Wijkman favors production on 
degraded and marginal lands or those multi-use lands which 
can adapt depending on global situations.  He also suggests 
that there should be financial or other incentives for 
avoiding deforestation. However, in response to the 
Commission's proposals on "no-go" areas for biofuels 
production, Wijkman expressed that he doesn't feel that 
Europe can tell Brazil, Chile, and the Congo not to produce 
anything.  Instead, they need to work globally to enforce 
sustainable practices, as it is possible to develop biofuels 
sustainably in the tropics. 
 
¶9. (U) During the Parliamentary debate, much as with ITRE, 
ENVI is not of one voice on biofuels.  The primary topics of 
discussion were the 10% share/35% GHG reduction targets. 
There was no consistent opinion on the concept of 10% vs. 8%, 
but what was clear is that there needs to remain a strong 
target.  Several ideas were floated, including 8% biofuels, 
plus 1% each hydrogen fuel cell vehicles and electric 
vehicles.  Others added in 1% minimum targets for second 
generation biofuels use.  Despite this, there was 
overwhelming support that while the GHG reduction target 
should be increased, jumping immediately to 50% likely is not 
supportable.  Many recommended a step-wise approach to higher 
levels.  MEP Dorette Corbey, in particular, suggested 
starting at 35%, moving up to 50% as an intermediate step, 
and then finally to 60%, achievable as the move to cellulosic 
biofuels takes place.  (Note: This could be an effort to more 
closely match the U.S. plan in the Energy Independence and 
Security Act, in which first generation biofuels have a 20% 
GHG threshold, second generation are at 50% GHG reductions, 
and cellulosic are at 60% GHG reductions.  Corbey was very 
interested when USEU EconOff described the language in the 
EISA legislation.  End note.)  In addition to the targets, 
the other key themes of the debate: 
 
  -- Most MEPs expressed that social criteria were absolutely 
necessary to include.  As in ITRE, ENVI called for inclusion 
of tying biofuels to food prices and to labor laws.  The 
Commission continues to reject this idea, explaining that 
food prices and labor laws are covered in other directives, 
and there is no reason to call those out specifically in 
biofuels.  Additionally, the Commission believes that the 
inclusion of social criteria would leave the EU vulnerable to 
challenge in the WTO. 
  -- Biofuels R&D will become a crucial aspect of Europe's 
ability to compete.  A few mentioned that Europe lags the 
U.S. in biofuels development, something which needs to change 
soon.  Additionally, Europe is not sufficiently focused on 
new areas of biofuels, whereas for example, the U.S. military 
is performing research on growing algae for biofuels. 
  -- The sustainability criteria absolutely need to be 
 
BRUSSELS 00000940  003 OF 003 
 
 
tightened, with many calling for the inclusion of indirect 
land use changes.  The Commission argued that Wijkman's 
proposals for indirect land use change would lower GHG 
reduction scores by 24% and that with an increase to a 50% 
threshold, only two biofuels-Brazilian ethanol and animal 
oils-would be able to meet the threshold. 
 
¶10. (SBU) None of these proposals or amendments are 
guaranteed to pass, as there is little agreement among MEPs. 
This legislative process, given how contentious the details 
are at this time, is likely to take at least to the end of 
the year to complete.  Both the ITRE and ENVI committees will 
be debating the proposed amendments in July, with a possible 
Plenary vote pending the outcome of the Committee 
discussions.  The Parliament is under a deadline to finish 
this soon, as both the Commission and the French Presidency, 
which begins in July, want to finish discussions by the end 
of the year.  This is in an attempt to avoid having to 
restart the process after the Parliamentary elections in the 
summer. 
 
MURRAY 
.