Summary: The role envisioned for liquid biofuels for transport has come under increased scrutiny in the past year or two, due to the potential social and environmental impacts associated with scaling up biofuels production and use from its low level—currently representing about 1% of transport fuels globally. The proposed EU Directive setting a target of 10% biofuels in transport sector by 2020 has therefore raised a number of concerns. The concerns about sustainability are addressed within the proposed Directive through criteria related mainly to GHG emissions, but also to biodiversity and other environmental impacts. The use of first generation biofuels in temperate climates is land-intensive and inefficient in technical terms, whereas first generation biofuels in tropical climates and second generation biofuels in general—offer a much more effective use of land resources. The use of GHG reduction criteria can provide incentives for producers to rely on the most productive feedstocks when sourcing biofuels for the EU market, which will often mean import of biofuels. A threshold of 50% or more would tend to eliminate many of the first generation biofuels produced in temperate climates. Member States should be encouraged to link financial incentives to the GHG reduction capabilities. Moreover, such incentives could be better linked to development cooperation in the case of imports, so as to insure that Least Developed Countries (i.e. in Africa) can gain access to larger markets rather than only the major producers such as Brazil. The calculation of GHG emissions associated with biofuels is complicated by the addition of factors associated with land use change, since the GHG impacts of land use change are beset by uncertainty both in physical terms as well as in the attribution of particular changes to production of particular biofuels. A further complication is introduced when indirect land use changes are incorporated, since these occur through combinations of market forces, illegal land use transformation, and regulat
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