Sustainability of biofuels

The Energy for Transport legislation and regulations only permit the use of biofuels that are sustainable. Companies may only register deliveries of biofuels in the Energy for Transport Registry that meet the European emission reduction and sustainability criteria. These criteria apply to liquid and gaseous biofuels.

Production chain certification

Certification is a key requirement for demonstrating that delivered biofuels meet the criteria. The entire production chain for biofuels must be certified in accordance with a voluntary scheme. This chain begins with the cultivation of crops and ends with the companies that ultimately supply biofuels to the Dutch market and register these deliveries in the Energy for Transport Registry. The certification held by the registering company must relate to the specific location from which the delivery is made. Companies are required to record a separate mass balance for biofuels for each certified location.

Companies may only use voluntary schemes that have been recognised by the European Commission.

Sustainability claim when registering biofuel

Once biofuel has been registered, it may not be resold as sustainable biofuel; the sustainability claim lapses when the biofuel delivery is registered. Therefore, the sustainability claim can only be redeemed by a single party by using renewable energy units (HBEs). This process is safeguarded by the registering company debiting the registered biofuels from the mass balance and specifying ‘NEa’ as the end user.

If a company cannot demonstrate the sustainability of biofuels, it will not be able to register those biofuels in the Energy for Transport Registry and consequently will not receive any HBEs for those biofuels.

Sustainability criteria

Biofuels only count towards meeting the Energy for Transport obligations if they are sustainable. At European level, the sustainability criteria have been elaborated in the Renewable Energy Directive.

In the Netherlands, demonstrating the sustainability of biofuels can only take place using voluntary schemes recognised by the European Commission. These voluntary schemes are required to demonstrate that the criteria listed below have been met.

Biofuels must meet certain land use requirements. The cultivation of the feedstocks, for example, may not affect the carbon sinks in the soil (such as in woodlands or peatlands). In addition, areas with a high biodiversity value are subject to special protection. These land use requirements do not apply to waste materials and residues that are not derived from agriculture, aquaculture, fishing or forestry, such as process waste products and process residues.

Companies have an obligation to reduce the emissions of greenhouse gases from the fuels that they deliver in relation to emissions of greenhouse gases from fossil fuels. This reduction is calculated across the entire chain from the cultivation of the feedstock up to the moment that the fuel ends up in the tank. The reduction must be at least 50% for installations that were operational prior to 5 October 2015.

This requirement increases to a minimum of 60% for installations that became operational between 5 October 2015 and 1 January 2021. Installations that became operational after 1 January 2021 are subject to an emission reduction target of at least 65%.

All companies in the production chain for biofuels must apply the biofuels mass balance system for their location(s) in their records, in order to ensure that the characteristics and amounts of biofuels are recorded in an accurate manner. The purpose of this approach is to ensure the traceability of goods and data throughout the entire production chain (chain of custody), and to safeguard that sustainable biofuels actually find their way to the market.

Proof of sustainability for biofuels

Each company is permitted to issue proof of sustainability for biofuel deliveries made from its certified locations. This proof of sustainability is intended for the buyer of the liquid biofuels.

The proofs of sustainability (PoS) ultimately travel the entire production and commercial chain until a registering company redeems the sustainability by registering the biofuel delivery for the Dutch transport market in the Registry Energy for Transport and by drawing up a proof of sustainability for the NEa, listing the relevant sustainability characteristics.

When registering gaseous biofuel deliveries, the Guarantees of Origin (GOs) in the form of Vertogas certificates constitute the proof of sustainability. The correct Guarantees of Origin allow registering companies to demonstrate the location at which gas production took place was certified under a recognised voluntary scheme. The Guarantees of Origin set out the sustainability characteristics.

Proofs of sustainability or Guarantees of Origin list the sustainability characteristics of the biomass feedstocks or biofuels. These characteristics include:

the name of the feedstock(s);
the country of origin for the feedstock(s);
the greenhouse gas emissions in the entire production chain of the biofuel;
the voluntary scheme under which the delivery is taking place.

Reporting by the NEa

Each year, the NEa reports on the sustainability characteristics of the renewable energy that was registered in the Energy for Transport Registry. This procedure takes place for the Netherlands as a whole and for each individual company registering liquid biofuels.

Sustainability of biofuels

Production chain certification

Sustainability claim when registering biofuel

Sustainability criteria

Land use requirement

Reduction of greenhouse gas emissions

Audit requirement

Traceability requirement

Proof of sustainability for biofuels

Guarantee of Origin (gaseous biofuel)

Sustainability characteristics

Reporting by the NEa

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