WSJ: Biodiesel sustainability & US tax credits targeted by EU

Sets standard for biofuels at 35% carbon reduction in swipe at Asian imports made from palm

By JOHN W. MILLER in Brussels and TOM WRIGHT in Jakarta, Indonesia
January 23, 2008; Page A11


The European Union will move today to protect its ailing transport-biofuels industry from foreign imports with measures that would force companies to show their fuels are helping the environment more than they are hurting it, according to documents seen by The Wall Street Journal.

The biggest losers are expected to be companies in Southeast Asia that make biofuels out of oil palms they have planted after cutting down forests. Trees soak up carbon dioxide; felling them blunts the benefit of cleaner-burning fuels made from oil palms.

Separately, the EU is preparing punitive tariffs on biofuel imports from the U.S. if Washington doesn't remove a tax credit for some American biofuels exporters, according to EU officials.

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