The palm oil industry has been lobbying Europe to allow palm oil-based biofuels to qualify as a low carbon fuel. But environmentalists say
substantial amounts of palm oil production occurs at the expense of tropical forests. Here rainforest in Borneo is being cleared and burned
for an oil palm plantation. Photo taken in May 2012 by Rhett A. Butler.

13/09/2012 (Mongabay.com) - The European Union may cap the use of crop-based biofuels over fears they can drive up food prices and aren't effective in reducing greenhouse gas emissions relative to conventional fuels, reports Reuters.

The rules were spelled out in draft legislation seen by Reuters. They still need the approval of lawmakers to go into effect.

"The (European) Commission is of the view that in the period after 2020, biofuels should only be subsidized if they lead to substantial greenhouse gas savings... and are not produced from crops used for food and feed," the draft said.

WHEAT: (1) process fuel not specified (2) as process fuel natural gas used in CHP (3)
straw as process fuel in CHP plants.

The draft suggests the E.U. is scaling back its ambitious, but controversial, biofuels target for 2020. It comes amid high food prices and complaints from environmentalists and other groups that crop-based biofuels production in contributing to deforestation abroad and exacerbating local environmental problems, including pollution.

The E.U. will attempt to made up any shortfall from abandoning crop-based biofuels with biofuels produced from waste and other feedstocks like algae, according to the report.

The E.U.'s target calls for using biofuels to meet 10 percent of transport fuel demand. Crop-based biofuels currently account for about 4.5 percent of Europe's road fuel consumption.