ACTION REQUEST: DELIBERATION BY MEMBER STATES ON

UNCLAS SECTION 01 OF 02 STATE 123492

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: KGHG EAGR SENV ENRG TRGY EUN EU
SUBJECT: ACTION REQUEST: DELIBERATION BY MEMBER STATES ON
EU BIOFUELS SUSTAINABILITY LEGISLATION

REF: A. USEU 1629

B. STATE 99217


1. (U) This is an action request for Posts in EU Member State
capitals. Please see paragraph 2.

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OBJECTIVES
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2. (SBU) In preparation for the European Council meeting
December 10-11, and a planned early December European
Parliament vote on the European Union's "20-20-20" Energy and
Climate legislation, Department requests Posts in EU Member
State capitals inform host governments of the below points
regarding the EU's biofuels sustainability proposals.
Although eliciting a formal response from the host government
is not necessary, Department requests Post's reporting of
host government's formal or informal reaction on this topic.

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REPORTING DEADLINE AND POINTS OF CONTACT
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3. (U) Posts are requested to report host government response
to this demarche by cable slugged to EUR/ERA Matthew Beh (202
647 1820, behmk@state.gov) and OES/EGC Drew Nelson/Ben
Zaitchik (202 736 7444, nelsonds@state.gov) on or before
Wednesday, November 26, 2008. This short timeline is
necessary to influence European decisionmakers in the window
of time between the Biofuels Ministerial in Brazil the week
of November 17, and the deliberations in Council on the EU
legislation the week of December 8. For further information
on the EU legislation and its specific biofuels proposals,
please see Ref A and Ref B, respectively, or contact Matthew
Beh or Drew Nelson.

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BACKGROUND AND GUIDANCE POINTS
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4. (SBU) Department requests that Posts in EU Member State
capitals convey the substance of the points below regarding
the EU's efforts to implement mandatory sustainability
metrics for biofuels, including greenhouse gas emissions
reductions, as part of the Energy and Climate legislation
currently under consideration. Draw from the following text
as deemed appropriate:

BEGIN NON-PAPER TEXT

-- The United States strongly reaffirms its commitment to a
stronger, more sustainable international biofuels market,
both through our domestic legislation as well as our
international efforts.

-- Biofuels offer a powerful tool for achieving the EU's
ambitious goals to reduce greenhouse gas emissions, and are a
critical element of U.S. national strategy for mitigating
greenhouse gas emissions, improving energy security, and
increasing global rural economic opportunity.

-- In deliberations on the EU Energy and Climate legislative
package, the U.S. urges Member States to carefully review
recent amendments made by the European Parliament on
sustainability requirements for biofuels. Many of these
amendments are subjective or impractical, lack a firm
scientific basis, and raise significant questions of
consistency with the WTO.

-- The U.S. further emphasizes the value of transparent,
science-based standards in any sustainability analysis. We
are committed to working collaboratively with the EU to this
end.

-- As we understand that the EU is committed to implementing
its renewable fuels directive in the very near future, we
urge Member States to work collaboratively and caution them
against taking trade restrictive actions against certain
biofuels in the interim period.

-- It is essential that the EU allow adequate time for

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producers to comply with the mandatory biofuels
sustainability framework that would emerge from the Energy
and Climate legislative package. A rush to implementation of
a complex scheme could have long-term market disruptive and
distortive impacts that would be most severe for small
producers and distributers. A minimum of one year should be
allowed, ideally more, to ensure that the requirements are
implemented in a practical, cost-effective manner.

-- U.S. domestic legislation, the Energy Independence and
Security Act of 2007 (EISA),mandates minimum reductions for
lifecycle greenhouse gas emissions from renewable fuels.
EISA also mandates accounting for direct and significant
indirect land use change in the lifecycle greenhouse gas
emissions for biofuels. In addition, the U.S. is developing
science-based criteria and indicators for sustainable
biofuels.

-- We urge that Member States work in Council to ensure the
Energy and Climate legislation as finalized gives European
Commission staff authority and flexibility to develop
sustainability criteria compatible with the requirements in
the U.S. legislation. This will help maintain a fungible,
"liquid" world market in biofuels. At the technical level,
U.S. and European experts are already discussing this topic,
and we hope to continue and strengthen that work.

-- Although the U.S. and EU may differ on the 'percentage' of
emissions reductions sought from biofuels through mandatory
domestic legislation, we should ensure that experts use
compatible, science-based methodology for 'measuring that
percentage,' to the greatest extent possible.

-- We are very concerned that U.S. corn ethanol is still
excluded from the latest EU default emissions tables, even as
Community-produced corn (maize) ethanol does have GHG
emissions savings ascribed. This could limit U.S. producers'
access to European markets. We urge you to develop
comparable values for U.S. and European corn ethanol, and
would appreciate your support in ensuring continued strong
collaboration between the U.S and Europe.

END NON-PAPER TEXT
RICE