BIOFUELS SUSTAINABILITY: AUSTRIA COMMITTED TO

UNCLAS VIENNA 001740 SIPDIS EU/ERA FOR MATTHEW BEH OES/EGC FOR DREW NELSON AND BEN ZAITCHIK E.O. 12958: N/A TAGS: KGHG EAGR SENV ENRG TRGY EUN AU SUBJECT: BIOFUELS SUSTAINABILITY: AUSTRIA COMMITTED TO STRONG CRITERIA, SAYS U.S. CORN ETHANOL IS NOT TARGETED REF: (A) STATE 123492; (B) VIENNA 1391 ¶1. Post shared ref A guidance points with relevant leadership in the Austrian Ministry of Agriculture and Environment (sections dealing with transportation concepts and fuels, EU coordination, climate change) and the Ministry of Economy and Labor (MinEcon). We followed up with MinAg fuels expert Heinz Bach, whose department has the lead on this issue for the GoA, and with Dr. Gabriela Habermayer, MinEcon Head of Multilateral Trade Affairs. ¶2. Bach explained that the GoA in principle supports the implementation of sustainability criteria for biofuels, as suggested by the French Presidency (ref B). In his opinion, sustainability criteria should apply for EU and third countries alike, but he is aware this may not be possible due to WTO requirements. If the EU adopts Energy and Climate legislation under the French presidency, a transition period of one year or more could be envisaged, since implementation will not start until at least 2010. ¶3. With regard to EU emission tables, Bach explained they are only meant as an example. They are not exclusionary or depletive, and would not mean that U.S. corn ethanol does not contribute to Greenhouse Gas Emissions (GHG) savings. Calculations for GHG savings could be done for any other region of the world, such as U.S. states. Bach does not anticipate trade constraints on U.S. corn ethanol; he does see cheap Brazilian ethanol threatening the European bio- ethanol industry. ¶4. Habermayer said the French Presidency was very keen to implement biofuels sustainability standards during its mandate. The standards' main target is to halt biofuels- related deforestation in sensitive countries. Member State economic ministries would urge that any measure be economically feasible, not protectionist, and measurably relevant to EU greenhouse gas reduction goals, she said. In inter-agency discussions the GOA Agriculture and Environment Ministry has been very "vigilant" with regard introducing strong ecological and social goals in the biofuels sustainability concept. Habermayer underlined what we heard from MinAg, that the main GOA concern is non- sustainable production from Brazil, not from the U.S. She floated including wording in the plan that meets the U.S. concern about U.S. corn ethanol and promised to raise this issue within the GOA. GIRARD-DICARLO