4 November 2011: A new study by the International Food Policy Research Institute (IFPRI), a centre of the Consultative Group on International Agricultural Research (CGIAR), analyzes the question of indirect land-use change (ILUC) in relation to the EU’s Renewable Energy Directive. It finds that ILUC issues are a valid concern, but that the impact depends on the type of feedstock crop used as well as other factors such liberalization of international trade in biofuels.

The study follows an earlier assessment that had already found that ILUC issues are a valid concern, but could not determine their degree of magnitude with certainty. The present study uses several methodological improvements to remove that uncertainty and uses updated data on the EU’s revised Fuel Quality Directive (FQD).

The study results provide estimates of the effects of the biofuel mandate on the prices of different feedstock crops as well as substitution effects under different free trade policy scenarios.

The study draws a number of policy-relevant conclusions, including: land-use related emissions could eliminate more than two-thirds of direct emissions savings; mitigation strategies must be consistent across a wide range of policy areas and emissions from biofuel production should not be treated differently than emissions from other types of agricultural production with regard to trade rules; a differentiated emission coefficient by crop can be difficult to use since factors are sensitive to leakages across different markets; ethanol produces less land-use change related emissions than biodiesel and trade liberalization in ethanol can lead to overall lower emissions; and available technologies to increase yield and low carbon agricultural practices should be promoted to reduce demand for land. [IFPRI Press Release and Summary] [Publication: Assessing the Land Use Change Consequences of European Biofuel Policies]