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Imagine finding out your super extra premium virgin olive oil was actually just some canola oil with green food coloring.
On Thursday Bloomberg reported that the EU, which is aggressively pushing up targets for switching to green fuels, is facing a big problem: biofuel imports from China flooding the market. And as if market dynamics weren’t slippery enough, there are some concerns that the imports aren’t even 100% bona fide, as rumors swirl that Chinese exporters may be juicing up profits by cutting their clean energy with not-so-clean ingredients.
Mixed In China
Companies that export biofuel into Europe enjoy the subsidies the bloc has put in place to reach its goal of having 14% of the energy in its transport system come from renewables by 2030, with at least 3.5% of it coming from advanced biofuels. This week, the EU mandated that starting in 2025, aircraft fuel needs to be mixed with sustainable fuels at a ratio of at least 2%. It wants that proportion to slide up to 70% by 2050.
Biofuels require a lot of land that would otherwise be used for agriculture to produce, so importing from large, arable nations makes sense at first blush. But international collaboration always comes with some risks, and for European green policies that has meant Chinese exporters flooding the EU market with cheap product, causing some local producers to hit pause — and cry foul play:
- One of the causes for suspicion is that the rise of Chinese biodiesel exports in 2022 coincided with increased imports of waste palm oil from Malaysia and Indonesia into China. That wouldn’t usually be a cause for alarm, except for the fact that palm oil production held relatively steady throughout the year.
- “You have a massive inflow of premium products arriving on the EU market at a very low price. Probably also partly because it is not based on the real feedstock,” European Biodiesel Board Secretary-General Xavier Noyon told Bloomberg. “At least that is what we strongly suspect.”
The Statler And Waldorf Effect: While Europe and the US bust open their wallets to hasten the green revolution, His Majesty’s United Kingdom appears to be lagging behind. Data produced by the UK parliament shows overall British investment in the energy transition fell 10% from 2021 to 2022, while the US and Germany increased their investments by 24% and 17% respectively. Don’t write off all Brits as apathetic to the climate crisis just yet though: protesters crashed BP’s annual shareholder meeting in London on Thursday to heckle its chair and CEO.