Is Europe’s new biofuels’ database a sign of things to come?

Everyone knew that the European Commission’s database for biofuels would be a massive undertaking as soon as it was announced. There had to be a crackdown after a serious fraud in the Netherlands, where a biofuels company was profiting by substituting cheap palm oil for expensive used cooking oil. The solution? A new system, hosted and developed by the European Commission, that tracks quantities of biomass from the point of origin, wherever that is in the world, through trading and processing to its placement on the market. Set against a general background of increasing differentiation between sustainable agricultural commodities and those with unknown credentials, it is just possible that this database will be a template for others. 

The new database, named the UDB (Union Database), will be a register for all certified biofuels, bioliquids and biogas that count towards EU targets for renewable energy. Each operator, right from the start of the supply chain, will have to register all purchases of raw materials and sales of products, which can only occur between entities on the database. Every operator will need a certification to an EU approved Voluntary Sustainability Scheme, to be accepted. The idea is that automatic checks will show up any inflated volumes, preventing the multiple or fraudulent counting of sustainable feedstocks or fuels.

Sustainability Schemes will be responsible for ensuring that their list of certified companies is kept up to date on the database. Software will be developed to carry out this task, and to automate the uploading of sales and purchase transactions, but the software developers will need to be approved as service providers. 

The devil is in the detail and many still have to be ironed out with stakeholders, but the Commission is sticking to its implementation date of December of this year. It is to be hoped that, in reality, time is allowed for operators to familiarise themselves with the system and for the developers to finish their work. It seems that all of the functionality is not yet completed. 

Before the system is finalised, participants should be insisting that they are given flexibility, rather than be handed a ‘one-size-fits-all’ solution. For instance, some operators have adapted their existing business software to carry out the mass balance as described in the Renewable Energy Directive II. Currently, sustainable raw materials can be mixed with other materials, if a mass balance accounting system is used to ensure the traceability of the sustainable biomass. At the end of an accounting period, each operator must have purchased enough sustainable material to provide for the volumes it has sold.  

However, the UDB won’t accept volumes of non-sustainably certified material so there is a risk that it forces operators into keeping a continuous positive balance of certified material on the UDB, in order to sell certified volumes. This would be against the spirit of successive Renewable Energy Directives which allow for mass balance periods of up to three months for industrial operators or even a year for farmers and forest owners. 

There is also a danger of inbuilt rigidity if Sustainability Schemes are allowed to insist that their members use a particular service provider, which would create barriers between different schemes. There is already friction between the schemes, which has caused some operators to hold more than one certification. It would be an added burden if choice on the means of access to the UDB is curtailed.  Operators will also have the freedom to upload their transactions manually, an option that small companies may want to retain.

The first to provide automated access to the UDB is Bioledger, an approved service provider orientated towards biodiesel made from UCO and waste animal fats. It has the benefit of extensive testing and improvement based on the input of users, and it is available now. Bioledger can also carry out the mass balance calculation. ISCC, the largest EU approved Voluntary Sustainability Scheme, has announced that it will also become a service provider, but details of its system have yet to be unveiled. There are no doubt others in the pipeline. 

Certification to a Voluntary Sustainability Scheme was introduced over ten years ago as a means to ensure that both crop and waste-based biofuels were sustainably produced without impacting biodiversity or protected landscapes and whilst saving substantial greenhouse gas emissions. Standards have been tightened over the years and the new database is the latest measure to try and ensure the system is bullet-proof.

As to the wider significance of the UDB, the EU will soon require that certain agricultural commodities imported into Europe have not caused deforestation. The Deforestation Regulation, which currently covers cattle, cocoa, coffee, palm oil, soya and wood, will expect individual consignments to be traceable back to the plots of land where they originated. Certification or independent auditing is not mandatory. The measures are a good start, but it will be no surprise if further tightening is needed, as people find ways round the new system. A database might sound like a good idea in a few years’ time. 

Published: 15 September 22

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