EU Renewables Directive: Good but Could be Better

by Ship & Bunker News Team
Wednesday September 13, 2023

Energy NGO Transport & Environment's take on the European Union's updated Renewable Energy Directive (RED III) says that it's good but could be better.

For shipping, the directive relates to Renewable Fuels of Non-Biological Origin (RFNBOs) which is an umbrella term for all gaseous and liquid renewable fuels not relying on biomass.

RFNBOs are best suited to those sectors of the economy where direct electrification is not feasible.

According to the directive, RFNBOs need to account for at least 1% of all fuels used in the transport sector by 2030. Because of their higher cost, they can be double counted (plus an 1.5 multiplier for shipping and aviation) to go towards that target.

This means that the actual use of RFNBOs will be less than the target suggests, T&E said.

RED III now includes a non-binding sub-target for 1.2% of the shipping fuels sold in
a country to be RFNBOs. Given the impact of the multiplier "this is less ambitious than it seems", according to the environmentalist.

"For the shipping industry, there is only a binding obligation to use 2% RFNBOs in 2034, but whether this obligation comes into force depends on a number of factors (price of RFNBOs, sufficient production capacity, etc.)."

Given the above, T&E is arguing for two changes to the non-binding 1.2% target for RFNBOs in shipping: that it must become a binding obligation and that the level of ambition is increased.