Netherlands biofuels policy

The traffic and transport sector is responsible for around 20% of the national CO2 emissions. Because many other sectors have already achieved significant emission reductions, the relative amount emitted by the transport sector will increase. In order to reverse the trend of increasing CO2 emissions by the transport sector, the Dutch government is encouraging the use of biofuels as part of its energy policy. The use of biofuels will also increase the security of energy supply, and domestic production of biofuels could offer employment opportunities. This last aspect is important in other countries (such as security of energy supplies in the USA), but is less important for the Netherlands.

As it focuses on these measures to encourage the use of biofuels, the Ministry of VROM (Housing, Spatial Planning and the Environment) is taking important steps towards a sustainable energy supply. In 2007, 2% of the petrol and diesel sold on the Dutch market had to consist of biofuels. Initially it was decided that this percentage, conform the European Biofuel Directive 2003/30/EG, should increase to 5.75% in 2010. However, in October 2008, the Dutch government amended the biofuel targets for 2009 and 2010, due to public concerns about the sustainability of biofuels. The target for 2010 is now set at 4%.

The Netherlands' biofuel policy is largely determined by policy developments at European level. The Renewable Energy Directive (2009/28/EC) [pdf - 1,25 Mb] which was published in 2009, states that (in 2020) 10% of all transport fuels must be derived from renewable sources. It is not just biofuels that play a role here, but also renewable electricity and hydrogen. This Directive also includes criteria for the sustainability of biofuels.
This also applies to the Fuel Quality Directive (2009/30/EC) [pdf - 152 Kb]  which was also published in 2009. This Directive states that fuel suppliers must gradually reduce the greenhouse gas emissions of the fuels they supply (over the entire life cycle), towards an eventual target of 6% reduction in 2020, with biofuels forming an important means of achieving this reduction.

• To Top

1. Biofuels obligation

Since 1 January 2007 the petrol and diesel suppliers selling these fuels on the Dutch market must ensure that a certain percentage (on an energy basis) of their fuel sales comes from biofuels. For the year 2007 this amount was set at 2%. The Besluit biobrandstoffen wegverkeer 2007 (Transport Biofuels Act 2007) - version 18 November 2009 [pdf - 21 Kb, Dutch] in which this is legally regulated, has been published in the official Bulletin of Acts. This version contains a number of amendments to the original publication [pdf - 71 Kb, Dutch], which includes additional information on this legislation.

Articles 5.2 and 5.3, which indicate the percentages for 2009 and 2010, were amended in October 2008. The biofuel target for 2009 was reduced from 4.5% to 3.75%. The target for 2010 was also reduced, from 5.75% to 4%. The reasons behind this decision were explained in a letter to the Lower House of Parliament [pdf - 27 Kb, Dutch]. At the end of 2009 the Transport Biofuels Act 2007 was again amended to allow a heavier weighting of advanced biofuels within the biofuels obligation  scheme.

The requirement to supply biofuels is not the same as compulsory blending. It concerns a legal requirement at macro level. The so-called permit-holders (excise warehouses) that supply petrol and diesel are required to realise part of their sales in the form of biofuels, but the actual amount of biofuels in the petrol and diesel may vary per location and per time period. Pure biofuels also count towards this target, provided the compulsory market share is achieved. Suppliers may also trade these requirements among themselves.

The Act includes the fact that Ministerial regulations may set additional criteria concerning sustainability. Categories of biofuels that do not comply with the minimum sustainability criteria may also be excluded from such Ministerial regulations.

Sections of the Netherlands' policy will be amended to comply with the Renewable Energy Directive. Implementation of the Directive into Dutch legislation will take place before 2011.

2. Scheme for double-counting advanced biofuels

At the beginning of 2008 the Lower House of Parliament (in a motion by Spies) was asked to ensure that  2nd-generation (and following generations of) biofuels were given more emphasis under the biofuels obligation scheme, in order to encourage the use of more sustainable biofuels. This resulted, at the end of 2009, in the Regeling dubbeltelling betere biobrandstoffen (Ministerial scheme for double-counting advanced biofuels) [pdf - 21 Kb, Dutch]  coming into force. The scheme is also responsible for the preliminary implementation of part of the  European Renewable Energy Directive (2009/28/EC) [pdf - 1.25 Mb].The complete implementation of this Directive into Dutch legislation must take place before the end of 2010, and will possibly lead to future amendments to the current scheme for double-counting advanced biofuels. The current scheme is backdated to 1 January 2009.

Under this scheme, companies that sell petrol or diesel in the Dutch marketplace may double-count certain biofuels when calculating their results towards the biofuel requirement. A company that meets its entire target commitment for 2010 via these advanced biofuels, only needs to sell 2% biofuels, rather than the standard 4%. This scheme applies to biofuels that are produced from waste, residues and ligno-cellulose materials. The scheme contains a specific definition of waste. This refers only to raw materials that cannot be used for a higher value application other than for generating electricity or heat, composting or using the ligno-cellulosic part as animal fodder – only these materials are eligible for the double-counting scheme. Should a particular raw material have an alternative application, then a market analysis must be used to prove that there is an excess of this material available, before it may become eligible for double counting. Biofuels made from ligno-cellulosic materials may always be counted double. This scheme only applies to biofuels with a greenhouse emission reduction of at least 35%.

In order to prove that the biofuels are eligible for double counting, companies must send annual reports to the Ministry of VROM, as part of their reporting on the market share of biofuels (see Article 4, clause 3, of the Act and the Ministeriële Regeling Administratie Biobrandstoffen (Regulations Concerning the Administration of Biofuels for Road Transport). The information provided by the fuel suppliers must be accompanied by a so-called Verification Statement. Inspection institutes must use the verification protocol [pdf - 1.5 Mb, Dutch] that has been developed for the Ministerial Scheme for Double-Counting Advanced Biofuels. This protocol contains basic rules, procedures and guidelines for the verification of double-counted biofuels.

See for further information the GAVE website on the Ministerial Scheme for Double-Counting Advanced Biofuels.

3. Regulations concerning the administration of biofuels for road transport

The Regeling administratie biobrandstoffen wegverkeer (Regulations concerning the administration of biofuels for road transport) [pdf - 48 Kb, Dutch] was published on 13 December 2006. The scheme sets the criteria for the administration concerning the sales of transport biofuels, as referred to in the  Besluit biobrandstoffen wegverkeer 2007 (Transport Biofuels Act 2007) - version dated 18 November 2009 [pdf - 21 Kb, Dutch]. This version contains a number of amendments compared to the initial publication, which also includes additional information on the scheme [pdf - 71 Kb, Dutch]. 

Permit-holders (excise warehouses) must report to the Ministry of VROM before 1 April each year, showing whether they have complied with the requirements for the previous year. These reports must include overviews of the amounts and types of biofuels supplied, as well as the amount of unleaded light oil and gas oil. They must also show that the compulsory percentages of biofuels have indeed been supplied.

The monitoring of the Act and this scheme, such as auditing the administration, is implemented by the Ministry of VROM's Inspectorate General (VROM-inspectie), and is based on the Wet Mileugevaarlijke Stoffen (Environmentally Hazardous Substances Act). The assessment as to whether or not a permit-holder has met the legal requirements to supply biofuels is implemented on the basis of the annual reports. The VROM inspectors may also ask to audit the permit-holder's accounts. As a result of the first report [Word - 57 Kb, Dutch]) the Minister proposed a number of amendments to improve the enforceability of the Transport Biofuels Act 2007 (see letter to the Lower House [Word - 110 Kb, Dutch]). 

The Regulations concerning the administration of biofuels for road transport [pdf - 430 Kb, Dutch] were amended on 8 February 2010 to allow the permit-holders to also include other biofuels (added category “Other biofuels supplied”) in the counting scheme.

4. Biotickets, the administrative trade in biofuels

Suppliers of petrol and diesel can meet their biofuel commitments by selling biofuels themselves, but also by selling biofuels to other suppliers. The administrative trade in biofuels is implemented via so-called biotickets.

The following downloadable document [pdf - 18 Kb] includes:

• background information on biotickets 
• what are biotickets? 
• the market and trading of biotickets  
• pricing of biotickets   
• finally, the document includes an example bioticket contract. 

5. European Biofuels Directive, 2003/30/EG

The 2003 European Biofuels Directive [pdf - 120 Kb] compelled EU Member States to make all efforts to introduce biofuels to the road transport sector. Support for the agricultural sector, improving the security of energy supplies and greenhouse gas emission reductions were all good reasons for the European Union to initiate this Directive. According to this piece of legislation, in 2005 some 2% of the energy-content of fossil fuels had to consist of biofuels, increasing each year to 5.75% in 2010. These percentages were indicative targets. Member States were not obliged to achieve these amounts. In October 2008 the Dutch government decided to amend these indicative targets.

Member States may choose between blending small amounts of biofuels in conventional fossil-based fuels, and introducing higher blends (e.g. bioethanol in the form of E85) or pure biofuels (such as pure biodiesel, B100). Blending lower percentages has the advantage that these blends may be used in ordinary petrol- and diesel-driven cars.

The European Renewable Energy Directive (2009/28/EC) came into force on 25 June 2009. At the end of 2010 this Directive must be implemented into national biofuel legislation in the European Member States. The implementation of this Directive replaces the 2003 Biofuel Directive (2003/30/EG), which will be cancelled on 1 January 2012. 

6. European Renewable Energy Directive, 2009/28/EC

The European directive to promote the use of energy from renewable sources, [pdf - 1.25 Mb] otherwise known as the Renewable Energy Directive (2009/28/EC) came into force on 25 June 2009. This Directive states that, in 2020, the European Union as a whole must ensure that at least 20% of its energy supplies are derived from renewable sources. The Directive must be incorporated into national legislations of EU Member States before 31 December 2010. Each Member State must draw up a national action plan for energy from renewable sources. This should include the general national target figures (for 2020) of the Member States for the energy supplied from renewable sources, for transport, electricity heating and cooling. These general national targets differ per Member State (see Appendix I, part A of the Directive). For the Netherlands the general national target was set at 14%. In their national action plans the Member States must indicate which measures are being/will be taken in order to achieve these targets. With the implementation of the European Renewable Energy Directive, both the 2001 Renewable Electricity Directive (2001/77/EG) and the 2003 Biofuels Directive (2003/30/EG) will be cancelled with effect from 1 January 2012.

The Renewable Energy Directive includes a specific target for the traffic and transport sector, i.e. that in 2020, at least 10% of all transport fuels (petrol, diesel, biofuels for road/rail transport, and electricity) must be derived from renewable sources. This not only concerns biofuels (such as biodiesel and bioethanol), but also renewable electricity and hydrogen, which also count towards achieving the target. Fuel blends with a biofuel percentage higher than 10 volume-percent must be clearly labelled as such at all points of sale.

Transport biofuels based on waste, residues, non-food cellulose materials and ligno-cellulose count as double for the national target and/or the biofuels obligation (Article 21, clause 2), and the (renewable) energy that is consumed by electric vehicles counts as 2.5 times the standard rate when determining the achievement of the targets set by the Directive. The Dutch legislation (Ministerial scheme for double-counting advanced biofuels) came into force at the end of 2009. 

If biofuels are to be counted towards the renewable energy target, they must meet certain sustainability criteria. This also applies if biofuels are to count towards the biofuel requirements (such as in the Netherlands) and if they are to be eligible for financial support. These sustainability criteria apply to both biofuels and liquid biomass that is used to generate electricity and heat. The reduction in greenhouse gas emissions must be measured throughout the entire chain, from raw materials to end-use, and compared to fossil fuels – this emissions reduction must be at least 35%. This applies to all installations that became operational after 23 January 2008. For production facilities that were operational before this date, the minimum criteria comes into force on 1 April 2013. From 1 January 2017 onwards, the criteria concerning greenhouse gas emission reductions will be tightened to at least 50%. Also, from 1 January 2018, this will be increased to at least 60% for installations that become operational on or after 1 January 2017. 

The European Commission's Directive contains information as to how the greenhouse gas emission reduction of biofuels (and liquid biomass) should be determined (see Article 19 and Appendix V). Member States may use the default values, or use their own actual values, provided these are calculated using the methodology described in the Directive. A combination of actual values and default values for each process step is also allowed. The total greenhouse gas emissions must be expressed in grams of CO2 equivalents per Megajoule of biofuel (gCO2-eq/MJ). If a production process also produces co-products as well as biofuels, then the greenhouse gas emissions of the entire process must be allocated to the various products, based on their energy content (Lower Heating Value). The Directive mentions several co-products where the energy content (for calculation purposes) is set at zero, and thus these should not be included in the calculations.

In addition to the criteria concerning greenhouse gas reduction, biofuels (and liquid biomass) must also comply with several other sustainability criteria. The biomass may not be derived from land with a high biodiversity value, such as jungles, protected nature areas, and grasslands with a high biodiversity. The biomass may also not be produced on land with high carbon stocks, such as water-rich areas and permanently forested areas. This also applies to peat areas, unless it can be proven that the production of biomass does not lead to the drying out of previously wet soils. The status of the land in January 2008 determines whether or not the aforementioned criteria apply.

Companies are required to report on other environmental effects, such as soil, water and air, as well on the recovery of degraded lands, social aspects, food prices and land-use rights. This last aspect is important for indigenous populations. Indirect effects or displacement effects that may occur as a result of the use of biofuels, are also covered in the Directive. The European Commission will report on these aspects every two years. For example, this report will cover the methods use to map out indirect effects, as well as the consequences for food prices and food security. The first evaluation will be conducted in 2014.

7. European Fuel Quality Directive, 2009/30/EC

The new European Fuel Quality Directive, [pdf - 1.1 Mb] (2009/30/EC) was published on 23 April 2009. This Directive aims to reduce the most important polluting emissions during the production and use of fuels. The Directive should also contribute to the realisation of the European reduction targets for greenhouse gas emissions, i.e. 20% in 2020.

The Fuel Quality Directive states that, from 1 January 2011 onwards, fuel suppliers must report annually on the greenhouse gas intensity of the fuels and energy that they have sold. Greenhouse gas intensity refers to the amount of greenhouse gas emissions over the entire life cycle of the fuel, per unit of energy. European Member States are also required to gradually reduce the greenhouse gas intensity of the fuels they supply by a maximum of 10% before 31 December 2020. The reduction in greenhouse gas intensity by this date should be at least 6%, compared to the average European greenhouse gas intensity of fossil-based fuels, as reported in 2010. This target should be realised through the use of biofuels, alternative fuels and the reduction in flaring and venting at oil-producing installations. After the evaluation and revision in 2014, this percentage may be increased to 10% in 2020. This partially depends on the large-scale availability of techniques such as electric-based transport and carbon capture and storage (CCS),

Biofuels may only count towards the realisation of these targets if they comply with the sustainability criteria stated in the Directive. These are the same as the sustainability criteria in the European Renewable Energy Directive  (2009/28/EC). Greenhouse gas emission reductions of biofuels are also calculated in the same way.

In addition to greenhouse gas emission reduction and sustainability criteria, the Fuel Quality Directive also contains technical specifications for transport fuels, which are different to the previous Fuel Quality Directive (1998/70/EG) [pdf - 152 Kb] published in 1998. This new Directive allows higher percentages of biofuels to be blended with conventional petrol or diesel. The maximum for petrol is set at 10 volume-percent ethanol (E10), and 22 volume-percent ETBE. The Directive also contains maximum levels for several other alcohols (see Annex I). With respect to ethanol, the Directive states that petrol containing 5 volume-percent ethanol (E5) must continue to be available until 2013, to supply existing vehicles where the guarantee does not cover the use of petrol with a higher biofuel content.
According to the new Directive, conventional diesel may contain up to 7 volume-percent biodiesel (FAME), provided the biodiesel complies with the FAME norm EN 14214. This percentage is higher than the current diesel norm EN590, which quotes a maximum content of 5 volume-percent. The European Commission encourages the European Committee for Standardisation (CEN) to continue working on a standard that allows higher levels of biofuel to be blended into diesel, particularly B10.

8. Sustainability of biomass and biofuels

The use of biomass as an energy source forms part of the transition to a sustainable energy supply system. However, the large-scale use of biomass can have negative effects on biodiversity, the position of the poor, and food supplies, as well as negative climate effects. The sustainability of biomass and biofuels is therefore a precondition for the Dutch ambition to encourage the use of bioenergy.

To prepare for policy developments concerning these aspects, the Dutch government requested advice on sustainability criteria for biomass from an independent project group known as Duurzame productie van biomassa (Sustainable Biomass Production), which was chaired by Jacqueline Cramer. This project group was also known as the Cramer Commission. With the publication of its report (July 2006) [pdf - 924 Kb, Dutch] widely supported sustainability criteria became available in the Netherlands for the production and processing of biomass for energy, fuels and the chemical sector. These criteria concern the following six themes: greenhouse gas emissions, competition with food crops, biodiversity, the environment, prosperity, and welfare. Many of these sustainability criteria for biomass have been adopted by the European Commission, in the European Renewable Energy Directive (2009/28/EC).  The Cramer Commission published its final report in February 2007, entitled  "Toetsingskader voor duurzame biomassa" (Testing framework for sustainable biomass) [pdf - 1.4 Mb].

In 2008, government Ministers Cramer and Koenders (from the Ministry of VROM and Development Cooperation respectively), sent a letter to the Lower House of Parliament [pdf - 103 Kb, Dutch], indicating how they expected to implement the sustainability policy during the period 2008-2011. Biofuels formed part of that policy. The government was also determined to allow sustainably produced biofuels to contribute towards a sustainable energy supply. Government policy focused on making the production of biofuels more sustainable, and strengthening the necessary international cooperation, so that all biofuels sold on the international markets are produced in a more sustainable manner. Over the next few years, this policy should achieve the following results: 

• Trial projects into making biomass more sustainably, in collaboration with biomass-producing countries.
• A political agreement on the European Renewable Energy Directive must be achieved, and the first certified biomass should be sold on the Dutch market.   
• The European Energy and Climate Measures, including sustainability criteria for biofuels and certification, should be adopted and implemented.   
• Innovation should focus on 2nd and 3rd-generation biofuels, as well as new crops and techniques, that compete less with agriculture and vulnerable nature areas (e.g. cultivation in salty areas or on impoverished lands). 
• An international system for macro-monitoring, in order to clarify the (direct and indirect) effects of production and consumption of biomass, and to follow the application of the sustainability criteria.  
• The EU legislation will be implemented in the Netherlands. 
• More-sustainable biomass production will be stimulated in developing countries, and attempts will be made to ensure that production is actually implemented in at least two developing countries.       

In addition, the aforementioned measures include plans to submit an annual overview to the Lower House of Parliament, after the Sustainability Monitor has been published. This overview will describe the progress made under this approach, and show which conclusions can be drawn from the Sustainability Monitor.

In order to allow certification of sustainably produced biomass for energy applications, the Nederlands Technische Afspraak (Netherlands Technical Approach, or NTA) 8080 on Duurzaamheidscriteria voor duurzame biomassa ten behoeve van energiedoeleinden (Sustainability criteria for sustainable biomass for energy applications) was published in March 2009. The NTA 8080 contains details of the sustainability criteria, as defined by the project group on   Sustainable Biomass Production (Cramer Commission), for solid, liquid and gaseous biomass. This norm is meant to be applied by organisations producing, processing, trading or using biomass for energy application, and wish to prove that the biomass was produced in a sustainable manner, so that this may be sold or used as sustainably produced biomass. NTA 8080 may also be accepted as proof that the sustainability criteria under the European Directive have been met. The regulations for certification as per the NTA 8080 criteria are defined in the  NTA 8081 Certificatieschema voor duurzaam geproduceerde biomassa ten behoeve van energiedoeleinden (Certification scheme for sustainably produced biomass for energy applications). The NTA 8081 scheme is currently still under development.

Continuing on the earlier work of the Cramer Commission, the Commissie Duurzaamheidsvraagstukken Biomassa (CDB) was established on 29 June 2009, chaired by Dorette Corbey. This committee has therefore also become known as the Corbey Commission, and its main task is to advise the government on the sustainability of the production and use of biomass, and to offer a forum for social discussion. The background to this project group is the European Renewable Energy Directive, which requires Member States to use 20% renewable energy (average over all Member States) and 10% renewable transport fuels by the year 2020. The CDB published its first three recommendations in November 2009:

• Transparency. By requiring fuel suppliers to report on the nature and origin of biofuels, the government can correct its course, if necessary, and consumers can choose to purchase sustainable products. 
• Honest competition. Sustainability criteria should not only apply to transport fuels, but also to the biomass used in power plants to generate electricity, or used elsewhere in the bio-based economy (such as the chemical industry).   
• Innovation. Take undesirable and unintended effects seriously and encourage greater efficiency in the agricultural sector, as well as in the use of residues and degraded lands. The CDB also suggests the government consider establishing a small tax on fuels (say, two eurocents per litre), to help generate sufficient funds to attack the worldwide loss of biodiversity.   

The CDB published its fourth recommendation in February 2010. This concerned the contribution that biomass makes to sustainable energy targets. The CDB assumes that, from 2020 onwards, the large-scale use of biomass will be competitive with fossil-based energy. Alongside the positive effects of this development, there are also considerable sustainability risks to be considered. The CDB therefore recommends that the target for 2020 should currently be set no higher than the minimum 10%, but to give priority to investing in the quality and sustainability of the biomass to be used. The CDB also recommends updating the policy in 2014, and possibly increasing the target for 2020, depending on the development of sustainability frameworks and advanced technologies.