On the 28th of January 2025, PubAffairs Bruxelles organised an afternoon of discussion on the development of renewable ethanol biorefineries as a strategic resource to accelerate the transition towards a competitive low-carbon economy. The event was also a timely opportunity to discuss how the EU bioeconomy can support farmers, enhance food security and reduce Europe’s reliance on external resources, with Biljana Kulisic, Policy Officer, Decarbonisation and Sustainability of Energy Sources, DG ENER, European Commission; Tsjerk Terpstra, Policy Officer, Renewable Energy, DG AGRI, European Commission; Zygmunt Gzyra, CEO, Bioagra; Michael Carus, Founder and Managing Director, nova-Institut and David Carpintero, Director General, ePURE who gave a keynote speech.
David Carpintero welcomed the panellists and stated his satisfaction for the fact that the speakers were about to discuss the pivotal role of renewable ethanol and European bioethanol refineries in fostering sustainability, competitiveness and resilience of the European Union. He emphasised that, as we navigate the complex challenges of climate change, energy security and economic instability, it has become clear that renewable ethanol is not just an alternative fuel, but also a cornerstone of Europe’s strategic autonomy, a fact explicitly recognised in the Draghi Report. He continued by explaining that renewable ethanol played a significant role in achieving the European Green Deal objectives and highlighted that the Fit for 55 Package has set ambitious targets for renewable energy, emphasising the importance of sustainable biofuels, such as ethanol. He also noted that the Green Deal’s objectives be further reinforced with the EU 2040 climate goals.
Subsequently, the speaker pointed out that products derived from biomass, such as corn, wheat or sugar beet has already provided an 80% reduction in greenhouse gas emissions compared to fossil fuels. To provide more context, he mentioned that the widespread adoption of ethanol fuel across the EU could reduce CO₂emissions by an amount equivalent to removing 8.2 million cars from the roads, whilst avoiding the import of 52 million barrels of oil annually. Additionally, he stated that the EU has implemented stringent sustainability criteria to ensure that biofuels are not sourced from high biodiversity or high-carbon stock areas. He explained that these criteria provide a transparent framework for all stakeholders and empowered certification schemes to uphold the integrity of the value chain. He then stressed that any suspicion of non-compliance needs to be addressed promptly and decisively to maintain the credibility of the entire chain.
Mr Carpintero continued by highlighting that European biorefineries have delivered more than just fuel. In 2023 alone, he explained, these facilities produced 6.5 million tons of protein-rich animal feed, surpassing the total volume of ethanol. He added that the sector has embraced the growing demand for plant-based proteins, with several European biorefineries now incorporating food production within their installations. Moreover, he pointed out that ethanol biorefineries generated biogenic CO₂, a versatile byproduct used in industries, such as carbonated beverages. He also remarked that biofuels were set to play an even greater role in Europe’s sustainable economy with the anticipated surge in demand for biogenic CO₂, particularly in connection with the higher demand for green hydrogen.
Furthermore, the speaker stated, European ethanol biorefineries relied on biomass sourced from local agriculture. He explained that European bioethanol producers collaborated closely with farmers, sourcing multipurpose crops that supported rural economies and traditional revenue streams. He noted that ethanol production currently occupies just 1% of the EU’s agricultural land, balancing energy needs with food supply whilst still providing ample room for growth. He argued that potential new uses of biomass would complement rather than replace existing production, ensuring that Europe continues to benefit from an abundant, affordable and highly sustainable renewable ethanol. He also pointed out that some pieces of EU legislation currently severely disadvantage crop-based ethanol, suggesting that future policies should aim for a more balanced approach so as to avoid actual or de facto discriminations. This new orientation, he remarked, would help ensuring that effective solutions are not unfairly penalised.
Mr Carpintero emphasised that the renewable ethanol sector strengthened the EU’s economic resilience and competitiveness by pointing out that domestic ethanol production reduced dependency on imported fossil fuels, thereby improving the trade balance and enhancing energy security. He also mentioned that ethanol production reduces exposure to volatile markets and fosters price stability. Additionally, he highlighted that European biorefineries have been a key source of vegetable protein, providing the EU’s main domestic supply and mitigating reliance on imports in the sensitive 25% to 50% protein range, whilst also creating opportunities for higher protein rates suitable for aquaculture and other uses. He further noted that the 50 ethanol biorefineries spread across Europe stimulate job creation across multiple sectors, including agriculture, research and development and manufacturing. He stressed that their impact is particularly significant in rural areas, where they serve as economic hubs, providing job opportunities and supporting local businesses. He explained that each biorefinery houses a specialised team of engineers dedicated to improving the circularity and efficiency of their operations in these areas.
David Carpintero concluded by stating that, by producing more renewable ethanol, Europe would address pressing environmental challenges, reduce reliance on fossil fuels and protein imports, support European farmers, drive technological innovation as well as mitigate geopolitical risks. He also asserted that renewable ethanol and European bioethanol refineries are indispensable to the EU’s vision for a sustainable, competitive and resilient future. He eventually urged European institutions to continue guiding Europe toward greater prosperity and called for ongoing support and advancement of the renewable bioethanol industry as a vital pillar of a shared European vision.
The moderator, Sarantis Michalopoulos, provided some context to the discussion. He pointed out that, over the months, the attitude on the other side of the Atlantic has been evolving, whilst political balances in Europe have been shifting and are likely to continue doing so. He also noted that the European industry is trying to establish itself as a global player and grow in ways that are both sustainable and affordable. He further explained that the EU industry has been under pressure from major global economies, including China, Russia and now, most likely, the United States. Additionally, as previously mentioned, he stated that the Draghi Report urged EU policymakers to enhance competitiveness, whilst maintaining a strong focus on sustainability.
The moderator also outlined the key points of discussion, stating that the panel would address topics such as renewable ethanol, biorefineries, road transport and decarbonisation. He remarked that, whilst these subjects have been object of debate for more than a decade, the current momentum makes them particularly relevant.
He subsequently introduced the panellists and turned to the representative of the European Commission. He referenced the widely discussed Draghi Report, which explicitly suggested that internal combustion engines would continue to prevail in the EU road transport system for some time. At the same time, he noted that the same report acknowledged the role of renewable ethanol in decarbonising road transport. Eventually, the moderator pointed out that the European Commission’s official position did not entirely align with this view and asked Ms Kulisic whether she believed this stance was likely to change.
Biljana Kulisic started her reply by clarifying that she could provide an overview of the state of play of EU biofuels-related policies and, perhaps, comment on them in a personal capacity. She then stated that, by analysing energy balances and bioenergy power as a whole – including solid biomass, ethanol, other types of biofuels and biogases-, these sources account for approximately 104 megatonnes of oil equivalent, with ethanol making up 3% of the total. Against this backdrop, she emphasised the importance of understanding this very scale. She further pointed out that, at present, there are no mature technologies available to produce biofuels at the level, price and quality required to decarbonise the entire transport system. Whilst there had previously been high aspirations for advanced biofuels under the RED I and RED II, these frameworks have not yet delivered the necessary technological advancements. She stated that, thus, the EU should continue to foster research and innovation in this domain.
Ms Kulisic also noted that transport remained the most challenging sector to decarbonise in terms of greenhouse gas emissions and that no single measure could achieve this goal alone. She also stated that an integrated approach is required, including diversifying the type of fuel. Moreover, she highlighted the importance of understating not only the questions emerging from ethanol producers, but also those from the car industry, which notably has a multiplier effect on the economy. She went on to explain that, even before the publication of the Draghi Report, there have been attempts to establish a more stable legal framework. Stability of policy framework, she argued, is crucial, as it provides a predictable environment to investors and policymakers.
Subsequently, she reflected on the moderator’s suggestion to reopen RED III by highlighting that reopening the RED III before its full implementation by the Member States would be a hastily decision, in her personal opinion. Acknowledging the need to secure energy supplies, Ms Kulisic reminded the audience that fossil fuels are not only used for road transport, but also for powering work vehicles and machineries with diesel and petrol as well as other transport means. She also stressed that decarbonisation efforts need to extend beyond road transport, namely to all sectors currently dependent on fossil fuels.
Sarantis Michalopoulos asked Tsjerk Terpstra about the EU’s strategic autonomy concept, which he stated it will be a crucial matter of debate in the following years. He also asked whether Mr Terpstra thought there is an added value in biofuels production in relation to the EU’s protein strategy.
Tsjerk Terpstra explained that the production of bioethanol also resulted in large quantities of distiller’s dried grains with solubles (DDGS) products, which have been used as high-quality animal feed, particularly for hog and poultry farming. He also acknowledged that bioethanol production can play a valuable role in relation to the EU’s protein strategy, but also emphasised the need to determine how best to integrate it within the protein value chain. Referring to what discussed earlier, he noted that it is crucial to consider the sustainability of feedstock sources. He also pointed out that this is a significant issue, particularly in agriculture, where land use is a recurring challenge. Finally, Mr Terpstra highlighted that the scale up of (renewable) energy should not undermine food production. In this connection, he explained that this has been particularly relevant from the perspective of European Commission’s Director General for Agriculture and Food.
Tsjerk Terpstra continued by explaining that, from the European Commission’s perspective, biofuels could contribute to the decarbonisation of the EU, with particular regard to the maritime and aviation sectors. He then highlighted that the European Commission has engaged in several dialogues with stakeholders which emphasised that certain domains would still require biofuels, or liquid fuels more generally, even beyond 2030. Mr Terpstra concluded by stating that, biofuels would anyhow need to be exploited in a responsible manner and that the focus should be on advanced and waste-based biofuels.
Sarantis Michalopoulos went on by asking Michael Carus his view on biorefineries, mentioning that some reports suggest that several advancements have occurred.
Michael Carus responded by stating that he is in favour of bioethanol and believed that Europe could produce more than it does now. However, he also expressed doubts about its use in the transport sector, arguing that road transport already has valuable alternatives. Additionally, he remarked that other economic sectors have been needing bioethanol, particularly the chemical industry, due to the lack of viable alternatives. He subsequently explained that the chemical sector is inextricably linked to carbon-based solutions, reasons for which the current debate focuses on “defossilisation” rather than decarbonisation. He continued by noting that ethylene, which notably can be produced from bioethanol, is a crucial element in this sector, and that sourcing all ethylene from bioethanol would require from five to six times more the current level of production.
The speaker also highlighted that road transport represents a vast market. However, several publications from the European institutions on sustainable carbon cycles suggest that 20% of the chemical industry’s carbon supply could come from renewable sources. In this connection, he emphasised that the definition of “renewable” should include bio-based sources, CO₂-based solutions and chemical recycling. He subsequently pointed out that meeting the 20% target for ethylene alone would require around 8 million tonnes of bioethanol, whilst stating that about 5 million tonnes are being used in road transport annually.
He also explained that ethylene is currently produced from both crude oil via steam crackers and bioethanol. He cited examples from Brazil and China, where several companies had successfully implemented the latter method. Against this backdrop, he argued that certain sectors had a critical need for carbon-based solution and would welcome the use of ethanol in the long term. However, he also noted that this transition has not yet occurred due to the absence of mandates or quotas for the chemical industry and highlighted that some efforts are already underway to change this setting.
In this connection, he proposed that, in order to advocate for the augmentation of bioethanol production, the most effective strategy would not be to campaign for mobility, but rather for the chemical sector. He subsequently emphasised that the chemical industry could successfully undergo “defossilisation”, if the proper policy framework is put in place. He concluded his remarks by expressing optimism that the new European Commission would swiftly implement guidelines and instruments to expedite this transition. In this case, he asserted, bioethanol could potentially become an even more important asset for the EU green transition.
Sarantis Michalopoulos asked for which reason, in the speakers’ opinion, Brazil, the US and China are promoting bioethanol in transport.
Michael Carus responded by drawing attention to the fact that a significant number of electric trucks are being sold. He then shifted the focus to the chemical sector, explaining that, currently, the chemical sector was 95% reliant on fossil carbon. The speaker emphasised that, while the sector still requires carbon, it should utilise biocarbon (carbon derived from CO₂) and recycled carbon. He emphasised the existence of a substantial and growing demand for these alternatives. Concluding his reply, the speaker stated that, although the transport sector might not absorb a substantial amount of ethanol, a considerable market for bioethanol already exists.
Sarantis Michalopoulos then asked Zygmunt Gzyra for more details about biorefineries and their advancements in the recent years.
Zygmunt Gzyra posited that a substantial degree of effort is required to facilitate the development of biorefineries, thereby fostering the competitiveness of EU companies. This endeavour entails a range of initiatives, including investment in innovation, product diversification and enhancing consumer awareness. These efforts have already been undertaken in the context of competition with suppliers from all over the world, including Poland, Brazil, the United States and China. He also noted that, at the inception of his company’s operation fifteen years prior, ethanol emerged as the primary product given its advantages in lower fuel grades compared to fossil fuels. However, he also noted that, as mentioned by David Carpintero, ethanol is now a by-product and stated that, in the current context, biogenic CO₂ capture, corn syrup and diverse protein products, among others, collectively constitute approximately two-thirds of the total European production.
Zygmunt Gzyra also emphasised the significance of feed and food products, which offer ancillary benefits in terms of increased reliance on domestic European sources. Further, he noted that Europe’s domestic production of high-protein products only accounts for around 30% of the total, with the remaining 70%, give or take, being imported, primarily from the US and Brazil. Out of 30% of domestic production, 25%, or around 85% of the total, came from biofuel plants. He argued that this is a significant amount and stressed that, without biofuels, the EU’s initiatives on protein production could never be implemented.
He then emphasised that ethanol was no longer the primary product in biorefineries as the sector had undergone substantial advancements. The speaker also elaborated on the fact, around 15 years ago, greenhouse gases savings on ethanol were approximately 50%. Over time, he continued, this figure has increased and current average carbon savings across Europe stand at 79%. He added that certain ethanol producers have struggled to improve their production processes, underscoring the commitment of the industry to achieve carbon neutrality. Against this backdrop, he stated that bioethanol producers could compete to offer decarbonisation solutions for transport, which is both the most difficult sector to decarbonise and the only sector which has augmented emissions in the previous 30 years.
Michael Carus took the floor to ask whether there is an increasing demand for both biofuels and CO₂ fuels for aviation. He also raised the question of whether, in case ethanol is produced for aviation fuel, the demand for proteins would remain the same, and wondered if the utilisation of ethanol is still necessary for road mobility, given the enormous demand in the aviation sector.
Zygmunt Gzyra replied that use of crop-based bioethanol for sustainable aviation fuels (SAFs) is not allowed in the EU, although he would like to see this setting reversed. He also pointed out that US policymakers allow the use of crop-based bioethanol for SAFs. He then went on to address the issue of biomass, feedstock and the potential volume of bioethanol, which would be significant, if there were no production cap. He also noted that it was difficult to provide figures on a European scale, as this would require calculating supply and demand for feedstock and the potential blending wall in each country. He also stated that a calculation had been carried out in Poland which showed that, without the 7% cap, the country could significantly increase production and attract investments. He then mentioned that, if the long-term strategy was stable and trusted by investors, the production of bioethanol would be much higher. Indeed, he affirmed that, in two or three years, Poland could reach around 1.5 to 1.7 million tonnes of biofuel. He concluded by saying that there was greater potential for crop-based biofuels in Europe, and that, if the EU policy approach was less dogmatic, crop-based biofuels could be used much more than they are today.
Sarantis Michalopoulos noted that the cap is still in place and it is unlikely to change in the following five years.
Biljana Kulisic took the floor by explaining that removing the cap would mean reopening the whole process of the RED III Directive, which has already been negotiated. She then praised the material efficiency of several biofuel producers, but stressed that such efficiency should be applied not only to the use of bioethanol as biofuel but also across the whole bioeconomy. She even suggested that this example of efficiency should be applied universally across the EU bioeconomy sectors. She then pointed out that ethanol is also a basic chemical and only if used as biofuel for transport, it is capped with 7% and subdue to the sustainability criteria and minimum GHG emissions savings. Even with the 7% cap, if overproduction occurs, other sectors would also need to be decarbonised. With this in mind, she reflected on the dilemma of identifying the best alternatives to decarbonise industries, citing the challenges faced by biomethane as it faces the question of the best alternative to decarbonisation.
She then highlighted that those who control energy supply have significant power over a country’s economic and social policies, pointing to Europe’s dependence on fossil fuels, with 77% of its energy coming from fossil fuels, most of which is imported. She added that Europe has only 23% of renewables in this mix and, whilst acknowledging the importance of the message of the Draghi report, she stressed that legislation should be first allowing time for its implementation. With the launch of the RED III Directive in November, two months ago from this panel, some articles would not be implemented until May 2025, she clarified.
She also mentioned that Europe is working hard to simplify processes and reduce burdens on its industry to achieve the twin goals of protecting the environment and boosting GDP. Balancing these objectives in the current context is key, whilst adding that new propositions are being brought to the table.
Zygmunt Gzyra, commenting on Ms Kulisic’s position, said that reopening the RED III file at that time might not be the best tactical move. However, he suggested that there are smarter ways to unlock the potential of crop-based biofuels. For example, he suggested that the EU institutions could withdraw the 2020 benchmark, which currently sets the level for biofuels by 2030. He also argued that the 7% cap is not working as crop-based biofuels in Europe is around 3% just as in 2020. He then said that the figure could theoretically be doubled without hitting the 7% cap and stated that, by removing the 2020 benchmark, EU countries could produce more crop-based biofuels. He finally suggested that, even if the 7% cap were to remain, it could be managed at EU level rather than at member state level in order to allow more flexibility across the European Union.
Michael Carus suggested that opening the door to ethanol in the chemical industry could resolve the ongoing debate about biofuels as an option and stated that this process would make it easier to replace bioethanol in the transport sector. He subsequently emphasised the need for a more balanced approach, pointing out that there needs to be better understanding across sectors. He eventually suggested quotas as part of the solution and asked how the European Commission is planning to use the chemical industry’s potential for ethanol to avoid further debate on biofuels and move forward with a more sustainable plan.
Tsjerk Terpstra took a broader view, namely from a bio-economic and agricultural perspective, acknowledging that farmers can contribute not only to food and feed, but also to fuels, bio-chemicals and construction materials, among others. He expressed uncertainty about whether quotas would be a good solution and mentioned that discussions on stability criteria for biomass are ongoing. He then noted that criteria already exist for biomass used for energy purposes and questioned whether these could be used as a baseline for other biomass applications.
He also mentioned that using a voluntary scheme might potentially serve as a baseline, but was unsure whether the same stability criteria could be applied to other uses of biomass, and stressed that this aspect needed further consideration. He also pointed out that there were already a considerable number of sustainability criteria in the existing legislation the EU is working on, particularly within the Common Agricultural Policy (CAP).
On the same note, Michael Carus expressed his concern that establishing different criteria for food, feed, chemicals, fuels and energy could lead to market distortions. He pointed out that, in reality, these sectors all use International Sustainability and Carbon Certification (ISCC) or ISCC+ as reference, fact which implies that the market is, in principle, already working under the same standards. He also suggested that having sector-specific criteria was somewhat of an artificial discussion.
In response, Tsjerk Terpstra explained that we need to enable win-win situations where primary producers get a fair share of the biomass they produce, as in practice primary producers do not always get sufficient benefits from their involvement in bio-based value chains. He added that this was one of the issues being discussed within the framework of the bioeconomy strategy. He also noted that a new approach is expected to be put forward by the end of the year, and that there would be plenty of opportunities for input.
Biljana Kulisic expressed her personal preference for a single set of sustainability criteria for biomass, regardless of its end-use, to protect the ecosystems from which it is extracted. In this connection, she suggested a broader and pragmatic approach and stressed that fuels should not be considered better or worse than biochemicals, or biomaterials better than biofuels, as an example. Instead, in her opinion, the focus should be on making the best use of biomass, whilst ensuring the health of the ecosystems that provide it.
The Q&A session covered the following issues: a holistic approach to bioethanol production, high-protein production for food and feed, and other valuable co-products produced under a circular process; the European Commission’s possible revision of the crop cap; the European Commission’s possible proposal of a new version of the Renewable Energy Directive (RED) beyond 2030; the Draghi report’s reference to investments in the chemical industry as a basis for a broader EU chemical strategy; the fostering of renewable ethanol biorefineries in Europe; the critical role of investors in determining the future of ethanol; unlocking the potential of biofuels by addressing the 7% cap; the need for changes in the Energy Taxation Directive (ETD); the 2018 bioeconomy strategy that set an objective to increase the deployment of biorefineries in Europe; Europe’s need of a strategic approach to secure the supply of biobased raw materials.
Source
PubAffairs Bruxelles, press release, 2025-05-08.
Supplier
Bioagra
European Commission
European Renewable Ethanol Association (ePURE)
European Union
nova-Institut GmbH
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