15/01/2008 (Mongabay.com) - The E.U. may ban imports of certain biofuel feedstocks that damage the environment, reports The New York Times. While Europe aims to supply 10 percent of all vehicle fuel from biofuels by 2020, environmentalists say some biofuels like palm oil are driving the destruction of biologically-rich rainforests and may produce more emissions than conventional fossil fuels.

According to an early draft of law to be unveiled last week, the European Union will ban biofuels derived from crops grown on some sensitive ecosystems, including tropical forests, wetlands and grasslands as of January 2008. The proposal will also require biofuels used in Europe to deliver "a minimum level of greenhouse gas savings." The decision could especially hurt soy production in the Brazilian cerrado and palm oil from Malaysia and Indonesia.

Palm oil producers expressed concern over the plans.

"The Malaysian government is very concerned about the E.U. scheme for sustainability of biofuels," said Zainuddin Hassan, the manager in Europe for the Malaysian Palm Oil Council in Brussels, told The New York Times. The measures "should not be a trade barrier to the palm oil industry and it should comply with the W.T.O. rules as well." The Malaysian Palm Oil Council was recently reprimanded by Britain's Advertising Standards Authority (ASA) for running "misleading ads" that portrayed palm oil as an eco-friendly product. Studies have shown that one ton of palm oil produced on tropical peatlands generates 15 to 70 tons of CO2.

Still it is unclear whether the E.U.'s proposed changes will address indirect environmental effects of biofuel production. For example, U.S. subsidies for corn ethanol have been linked to forest clearing in the Brazilian Amazon, though little American ethanol reaches export markets.

The proposed restrictions may create a new market for "eco-friendly" certified biofuels. Already industry-driven initiatives in southeast Asia (the Roundtable on Sustainable Palm Oil) and the Amazon (under the soy moratorium by the Brazilian Vegetable Oil Industry Association and the Brazilian Grain Exporters Association) are working towards a framework on sustainable production of energy crops. Analysts say second generation biofuels, like cellulosic ethanol derived from farm waste and wood, could offer better environmental performance than present feedstocks.