São Paulo, December 17, 2008 – Today’s approval by the European Parliament of the Renewable Energy Sources Directive is a clear sign that a sustainable market for renewables in transport will be created in the European Union. The decision by the EU, which calls for the adoption of a 10% mandatory target by 2020 for renewables in the transport sector, is “the positive signal biofuels producers, consumers and investors have been waiting for,” according to Brazilian Sugarcane Industry Association (UNICA) president and CEO, Marcos Jank.

The mandatory 10% target, which includes comprehensive sustainability criteria for biofuels and bioliquids, will allow the European Union to move away from a fossil fuel based economy and face challenges posed by climate change and energy security, while diversifying its energy sources. The decision by the European Parliament, which endorses the political agreement reached by the European Council on December 11, is an important and balanced step forward according to Jank: “With the Directive, Europe moves closer to defining a sustainable market for renewable fuels in transport, including but not limited to biofuels, and Brazilian sugarcane-based ethanol is in a position to contribute sustainably to the EU’s ambitious objectives.”

Already a significant player on the EU ethanol market, Brazil’s sugarcane industry is confident the sustainability criteria set out in the Directive will be complied with. UNICA welcomes the progressive increase of the ‘efficiency threshold’, which gradually increases the requirements for greenhouse gas (GHG) emissions savings compared to fossil fuels, from 35% when the Directive enters into force in 2010, to 50% by 2017 and 60% for new projects launched as of 2017. The establishment of areas of high biodiversity and carbon stock as “no go areas,” already a reality in key sugarcane growing and ethanol producing regions of Brazil, is also supported by the Brazilian cane industry.

“Strict national legislation and the industry’s own initiatives already in place, plus land use planning instruments like the agro-ecological zoning adopted in September 2008 in the most important sugarcane growing region in the world, the State of São Paulo, are realities in Brazil. Add to this the federal government’s upcoming national mapping of regions suitable for sugarcane, and you have a solid set of safeguards ensuring that the expansion of sugarcane does not endanger sensitive areas or compete for land with other agricultural activities,” adds Marcos Jank.

UNICA also welcomes the balanced approach chosen by the EU regarding the impact of so-called “indirect land use changes” (ILUC) on GHG emissions. According to Jank, the decision to pursue the development of an appropriate methodology is a positive sign that the European Commission wants to properly assess these effects, indicating a willingness to rely on sound scientific criteria, accepted and applicable globally: “To ensure potential ILUC is properly analyzed, the scientific community has to be given enough time to deliver reliable, solid results.” 

To keep the sustainability criteria in the Directive from becoming new non-tariff barriers to trade, UNICA urges the EC to publish clear, comprenhensive guidelines for their implementation. “The certification of sustainable biofuels is the next step to complete this process, which needs to be addressed as soon as possible. In that respect, the EU-Brazil Summit on December 22 in Rio de Janeiro provides an excellent opportunity for advancement. UNICA hopes our leaders will include this issue on the event agenda,” concludes Jank.

ABOUT UNICA
 
The Brazilian Sugarcane Industry Association (UNICA) represents the top producers of sugar and ethanol in the country’s South-Central region, the heart of the sugarcane industry. Along with its 116 member companies, UNICA provides information on the sector, including statistics and specific research, and enters into dialogue with stakeholders in support of Brazil’s sugarcane, ethanol and bioelectricity sectors. Its member companies account for more than 60% of Brazil’s sugar and ethanol production.

FOR MORE INFORMATION
CDN – Corporate Communications
Marli Romanini - (5511) 3643-2756 / marli@cdn.com.br
Rosa Webster - (5511) 3643-2707 / rosa.webster@cdn.com.br
Mariane dos Santos - (5511) 3643-2730 / mariane.santos@cdn.com.br