Market Research and Insight

The EU is facing pressure to close a loop in trading laws that allows nugget-heads to undermine the European biofuel industry. Some imported US...

922168_flower_field_2-1.jpgThe EU is facing pressure to close a loop in trading laws that allows nugget-heads to undermine the European biofuel industry.

Some imported US biofuel, known as B99 – a diesel blend that contains 99 per cent biodiesel and one per cent petroleum diesel – is exploiting the US B99 subsidy.

Splash-and-dash oil, where you import the ingredients for biofuel from cheap countries but refine it in one place, is a popular way to manufacture biofuel in the US.

This allows US exporters to undercut European rivals, which is already forcing cutbacks in production. The subsidy is unpopular in Europe because it benefits exporters.

The European Biodiesel Board is trying to change the situation.

The Guardian had this a couple of days ago. Sorry we missed it, but we’ve been busy, innit man.

The “splash and dash” scam involves shipping biodiesel from Europe to the US where a dash of fuel is added, allowing traders to claim 11p a litre of US subsidy for the entire cargo. It is then shipped back and sold below domestic prices, undercutting Europe’s biofuel industry.

The trade is not illegal, but flouts the spirit of producing green fuel by transporting it needlessly across the Atlantic at a time when campaigners are voicing concern about emissions from global shipping.

The EU is being urged to take action to stop a biofuel trading scam that exploits US agricultural subsidies and undermines the fight against global warming.

Up to 10% of biofuel exports from the US to Europe are believed to be part of the rogue scheme reaping big profits for agricultural trading firms.

The “splash and dash” scam involves shipping biodiesel from Europe to the US where a dash of fuel is added, allowing traders to claim 11p a litre of US subsidy for the entire cargo. It is then shipped back and sold below domestic prices, undercutting Europe’s biofuel industry.

The trade is not illegal, but flouts the spirit of producing green fuel by transporting it needlessly across the Atlantic at a time when campaigners are voicing concern about emissions from global shipping.

Dan Ilett