Select Committee on Environmental Audit Minutes of Evidence


Examination of Witnesses (Questions 120 - 124)

TUESDAY 20 NOVEMBER 2007

MR PETER KENDALL, MR GUY GAGEN, MR GREG ARCHER AND MS JESSICA CHALMERS

  Q120  Mark Lazarowicz: We have had suggestions in some of the evidence we have received that the carbon and sustainability standards, which have been developed for biofuel, could be expanded to include ultimately all agricultural commodities and this would be a good way of providing solutions to environmentally and socially damaging practices internationally. Mr Kendall, do you agree with that?

  Mr Kendall: Again, I will return to my comment from earlier on about non-trade issues in the WTO. There are real issues about sustainability being put into trade rules at the moment. You will find me wherever possible talking about the standards of UK production. If I told you that 70% of all pigmeat that is imported in the UK at the moment would be illegal under UK standards, the more we can demonstrate through labelling the standards of which we produce in the UK, the happier I would be. We do want to look at sustainability criteria on agricultural products, we do want to look at the carbon footprinting, but I think we have to understand the science behind it and be careful. As I mentioned in my earlier comments, we are producing in a natural environment, we are not actually producing in a factory, so it is quite a challenge. I want to understand the science because I think some of the stuff which was quoted in your last evidence session from Paul Crutzen again talked about nitrous oxides and I think we have to be careful, the science has to be confirmed rather than an initial paper which Paul Crutzen has published. We have done some work with the Imperial College and even going towards Paul Crutzen's figures on nitrous oxide, I feel production in the UK can still be saving 70/80% of CO2 emissions or greenhouse gas emissions.

  Ms Chalmers: Can I make a point about the use of these standards for food. You will be aware that one of the pragmatic frameworks for this carbon and sustainability reporting scheme relates to the existing and effective use of voluntary agri-environment schemes. One of the ones which has been mentioned quite a lot, understandably, is the Roundtable on Sustainable Palm Oil, which itself was an initiative of the food industry. One of the things we have learned from the work we have done on the RTFO is that a lot of these standards are existing standards for the food industry which, as Greg Archer mentioned, are now starting to address some of the issues which concern biofuels that did not concern the food industry. What we have seen, and will see from the new criteria of the RSPO next month, is those criteria are being expanded to address the concerns of the food industry and the biofuels industry so that there should be one standard for both and not a differentiation in the market.

  Q121  Mark Lazarowicz: The answer from both of you is yes basically?

  Mr Kendall: Yes.

  Ms Chalmers: Yes.

  Q122  Chairman: We have heard that biodiesel produced here and in the EU is being undercut by cheap imports from America because of a tax loophole there. Would you like to say what impact that is having?

  Mr Archer: It is not something I have direct experience of, but certainly by talking to biofuel producers in the UK it is clear that levels of UK production have fallen enormously since this dash and splash arrangement started to be implemented. It is having a profound effect both in the UK and in Europe and it is a loophole which really needs to be closed because it is creating a completely unfair competitive advantage for US producers.

  Q123  Chairman: That is the NFU's view as well?

  Mr Kendall: Absolutely, yes.

  Mr Gagen: We have long argued against the US sending soya products into the European Union that are being subsidised.

  Q124  Mr Chaytor: What about from US imports? What I find hard to understand is how can biofuels produced in the UK in the temperate zone possibly compete with biofuels from tropical countries if the EU guarantees there will be no tariffs on sustainable imports, as they appear to have indicated will be the case? Can you construct a viable industry in a temperate zone which can compete fairly and profitably with imports from tropical countries?

  Mr Gagen: In the first instance, we have been running the Food Assurance Scheme for ten years already, which has full traceability right back to the independent audit of every farm. We are in the lead in providing evidence which is required, so that gives us a certain advantage. Depending on what you do with the co-product produced in the bioethanol production process, for example, you are taking about a third of the crop to make bioethanol and another third of it to make dried distillers' grains, if the carbon rules were very strict you could co-fire those in a power station and gain carbon credits for that. We are disappointed that there is no figure available for feeding them to livestock because we think perhaps that ought to be accounted for as well. When you add those together, yes, we are probably very competitive with products from outside the EU.

  Mr Archer: We have had extensive discussions with the European Commission in trying to encourage them to take forward the types of schemes which the UK has developed. One of the main reasons they have put forward for not adopting our kind of approach is they are worried that Brazilian sugarcane ethanol will receive extra credits if you link to carbon, because they do not want to see huge imports of Brazilian sugarcane ethanol into the EU undermining European production. Frankly, I would be surprised if we saw a complete removal of duty for sustainable feedstock. The driver in most European countries remains the protection of their agricultural industries and rural development. That is the overriding driver which continues the biofuels policy at an EU level. That is why it is so important that the UK is in there arguing the environmental case and encouraging them to adopt the kind of excellent practice which the UK has developed.

  Chairman: Thank you very much indeed for coming in. It has been a very interesting and helpful session.





 
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