International Policies on Bioenergy and Biofuels - Industrial Crops: Breeding for BioEnergy and Bioproducts - page 386

The EU import tariff on biodiesel is 6.5 %, while it is only 3.2 % on vegetable oil
for biodiesel production (soybean, sunflower, rapeseed). In response to the
U.S. “splash & dash” program, in March 2009 the European Union imposed
antidumping and countervailing duties on imports of U.S. biodiesel [ 40 ]. The
antidumping duty rates range between

€ 68.60 and € 198 per tonne (equivalent to

approximately € 0.09-0.25 per liter). The countervailing duty rates range between

€ 0.24-0.27 per liter) [ 33 ]. Nevertheless, some

European trading partners already benefit from duty-free access for biofuels
under the Everything But Arms Initiative, the Cotonou Agreement, the Euro-Med
Agreements, and the Generalised System of Preferences Plus [ 24 ].
Brazil applies a 20 % import tariff (temporarily suspended in 2010 and 2011) on
denaturated and undenaturated ethanol and a 14 % import tariff on biodiesel.

211.20 and € 237 per tonne ( €

Other Biofuel Support Instruments

Other support instruments targeted at the biofuel sector include grants and loans,
price support, research and development subsidies, support for distribution and use,
and subsidies targeted on biofuel production. These instruments are less widespread
and may have direct and indirect and long-term impacts on the biofuel sector.
Grants and loans are directed toward supporting biofuel industry by providing
investment grants to build ethanol refineries and biodiesel production plants. These
grants reduce investment costs. By the same token, subsidized loans also reduce the
cost of investment and therefore support the growth of the biofuel industry. Some
countries created a scheme which allows the investor to reduce its taxable income
when biofuel plants are constructed. For example, the Government of Canada has
invested C$200 million in the “ecoAGRICULTURE Biofuels Capital Initiative,” a
program providing loans (repayable contributions) with the aim to encourage
producer equity/ownership in biofuel facilities [ 38 ].
Price support can be also used to enhance production of biofuels. The govern-
ment sets a guaranteed price above the market price. Biofuel distributors therefore
pay a higher price to the producer of biofuel than they would pay without the price
support. For example, the incentive for farmers in Germany to invest in biogas
digesters is a guaranteed feed-in tariff for the generated electricity which is con-
siderably higher than that of electricity generated from fossil fuels, natural gas coal,
or nuclear sources [ 48 ].
Research and development subsidies aim at supporting technological innovation
of biofuel production. Often, this assistance is provided for research and develop-
ment related to biomass conversion into biofuels. However, the focus of these
programs is increasingly shifting toward second-generation biofuels as they may
have more favorable economic and environmental effects (e.g., related to land use,
food price effects, environmental implications) than conventional biofuels. For
example, the IEA estimates direct government spending on new biofuel-related