The Digest’s Exclusive Q&A with Clariant/ Enviral: Decarbonization, EU transport, Slovakia project, biofuels developments and more

Climate change is one of the global challenges of this century. The Paris Agreement sets greenhouse gas reduction (GHG) targets also for the transport sector, which contributes significantly to GHG emissions, that requires a reduction of 85-90% between 1990-2050. The European Commission presented its 2030 Climate Target Plan in mid-September, raising the EU’s ambition to reduce GHG emissions to at least 55% below 1990 levels by 2030. The plan is seen as bridging to the EU’s decisive goal to become carbon neutral by 2050.

The Digest spoke to Christian Librera, Vice President and Head of Clariant’s Business Line Biofuels and Derivatives, and Robert Spišák, Chairman of the Board of Envien Group to capture their view on the necessary measures that need to be taken in the near and midterm.

Q: The European Union has set itself ambitious goals to become carbon neutral by 2050 and hence raised its 2030 climate target. What does that mean for the EU transport sector?

Christian Librera: The decarbonization of the EU’s transport sector has been a major year-long issue, particularly in road transport that is almost entirely dependent on fossil fuels. The strong growth in transport volumes over the last 25 years has led to an increase in GHG emissions from this sector, although drive technologies’ efficiency has improved. To meet the GHG savings targets for 2030 and beyond, a broad portfolio of technology solutions is imperative. Not one measure alone will combat climate change, neither from a technology perspective, nor from a supply potential. The share of electromobility in new vehicle registrations will rise continuously and significantly in the next decade. However, as studies, e.g., from the European Automobile Manufacturers Association (ACEA) show, vehicles with combustion engines will still account for the majority share of the vehicle population in 2030 and, most likely, hereafter. We need a strong and stable framework that supports a broad portfolio of mobility solutions. Therefore, a key focus of the EU’s transport and future mobility policies should be on those technologies that can immediately be used in today’s existing fueling infrastructure without any additional measurement or investments: sustainable, advanced biofuels, e.g., cellulosic ethanol. They provide a low-emission solution already today.

Robert Spišák: Transport won’t be able to change as fast as the politicians wish. To commercialize today`s innovations takes substantial time, up to 10 years. The setting of ambitious goals and strategies from Brussels’ perspective shows the direction of the current establishment’s policy. But from the practical point of view and bearing the technological status quo in mind, the goal defined without clear and stable application guides and precise vision seems more than ambitious. 

Transport represents about a third of all emissions. Many countries, including Slovakia, have not reached emission savings from fuels at the targeted level of 6% by 2020 so far, and the same is expected with the 10% renewables transport target. This situation results from the constant change of the rules applied. Member States have to meet the targets, but at the same time, they got restrictions and limits added to the game during the time, which undermine investor´s security significantly.

Renewable energy technologies represent a long-term investment, and they were stressed with U-turns in policy for a whole decade! The European Commission likes to play its favorites, in 2009 it was biofuels, in 2016 electrification, now it`s hydrogen, but we need every tool in the toolbox to reach the ambitious goals. If we are serious about decarbonization of transport, we need to maximize the use of proven alternatives, like all sustainable biofuels now and to add new innovative solutions, such as electromobility or hydrogen gradually after a thorough analysis of impacts. We need all the energy sources in parallel, not only one at a time. The same stable conditions and requirements shall be applied for all of them, no fashion.

Q: On the EU-level, the Renewable Energy Directive (RED) II is fostering an increasing share of renewable energy sources in the transport sector to 14% by 2030. It seems like the sails are set in the right direction.

Christian Librera: Yes, RED II sets the right direction by enabling advanced biofuels to contribute to the decarbonization of EU transport. It fosters the proliferation of advanced biofuels as it defines an advanced biofuels target outlined in Annex IX, part A that will reach 3.5% by 2030. This means that the demand of 5 to 10 Mio. tons of advanced biofuels need to be met across Europe in 2030. What is absolute key now is the swift and ambitious transposition of RED II in the member states, especially for the advanced biofuels target. The European Commission needs to make clear to the member states that the planned revision of the Directive will continue in the same spirit as RED II and that advanced biofuels will remain supported through a dedicated sub-target. And it needs to ensure a coherent and forceful implementation of the agreed targets in the member states. With the current revision, the 3.5% advanced biofuels target should omit the instrument of double counting and multipliers of any renewable energy source, as they artificially inflate the achievements without generating “real” GHG savings. Of further utmost importance are the ramp up targets from 2022 onwards: the member states’ expansion paths must be ambitious to ensure that advanced biofuels can unfold their GHG savings potential quickly enough. Thanks to the maturity of advance biofuel technologies, such as sunliquid, and the abundant availability of feedstock in the EU, this is immediately possible and absolutely necessary.

Robert Spišák: We clearly support a 14% renewable energy target in 2030, which will be most likely even increased, based on the ambitious climate target. However, the devil lies in the details at the Member States level and in the implementation itself. As consultations on further changes of RED II are already underway, it is essential to underline the vivid need to keep the legislative framework for all alternatives stable from a long-term perspective. Watching the process from the investor`s side, we look for predictability, easy rules, clear wording, and less limits for the Member States to be able to use the best domestic capacities and resources, whether conventional or advanced but sustainable. All renewable energies produced sustainably should be counted towards the goal without multipliers, which only artificially inflates the effort and does not solve the real problem.

Just to demonstrate the policy’s inconsistency that undermines investor`s confidence to put the money in their projects – in the ILUC directive from 2015, there was a recommendation for a 0,5% target for advanced biofuels which was also transposed to the Slovak legislation and brought us to the intention to invest. But then, during the negotiation about RED II, the target was lowered to 0,2% with double-counting (so 0,1% in reality) and binding only from 2022. So, 5 times lower and still not valid for some time that led consequently to the decrease of the target in Slovak legislation from 0,5% to 0,3% as well. 

Q: What are the latest developments in Slovakia to transpose the RED II into national law on a country level?

Robert Spišák: Being the responsible authority for the RED II transposition into national law, the Ministry of Economy has already carried out preliminary consultations on the transposition. Based on this progress, we observe the authorities’ interest in transposing the directive in due course and in line with other important documents that were part of the national ambitions in the Energy-Climate Plan and reflect the real potential of Slovakia. Based on the ILUC directive transposition, we have already had the obligation for operators to blend a fixed minimum share of advanced biofuel from 2019 and Slovak biofuel manufacturers have been ready to guarantee the needed share from 2020 fully. We believe that even if the target and obligation was lowered for 2021 and 2022, we can expect an ambitiously growing trajectory up to 2030, which will be defined along with RED II transposition, and the policy will get even more coherent with the real Slovak manufacturing potential.

Q: We have reported about Clariant’s and Enviral’s ambitious achievements and plans in the advanced biofuels market in the past. Could you shed some light on the latest developments?

Christian Librera: Over the past four years we have announced six cellulosic ethanol projects in the EU and China – our own flagship plant in Romania and five technology license projects in Slovakia, Poland, Bulgaria, and China. Our first-of-its-kind commercial-scale production plant in Podari, in the Southwest of Romania, has made significant progress over the past months. With the majority of large key equipment installed, this puts us on track to complete the construction by the end of 2021, after which start-up and production will begin. Beyond that, the focus is on broadening our sunliquid technology platform in different aspects. As mentioned, we have demonstrated licensing successes in Europe and since the beginning of last year, also in China, but we also want to demonstrate the success of sunliquid in other regions. Besides that, we are continually broadening our feedstock portfolio that is tested in our pre-commercial plant in Straubing, Germany. Up till now, approx. 30 different feedstocks from around the world have been tested, and with each new regional market we enter, new feedstocks are added. And the third dimension is broadening the product portfolio. As sunliquid is a very versatile technology platform going beyond the production of cellulosic ethanol, our cellulosic sugars can act as a building block for a wide range of biochemical intermediates.

Robert Spišák: Envien Group is deeply involved in renewable innovation, having its own R&D center. Our hands are on improving existing production standards and plans to optimize the implementation of new waste-based biofuel production and advanced biofuel production projects to our pool. The new waste-based biodiesel line will start its full operation in the second half of this year. The biggest excitement was to announce the start of the construction of our 50k tons of cellulosic ethanol production in cooperation with Clariant. Thanks to national policy, there is a growing demand for advanced biofuels in our region. For us, it means an interesting opportunity for further development. Due to our project´s complexity and the uncertainty that stems from the revision of RED II, we had to postpone the project implementation a little bit. In the meantime, our peers worked hard to optimize the original project by integrating the new facility into the existing production site of conventional biofuels, which will lead to unique synergies and a significant reduction of the GHG profile of the whole production site.

Q: You already pointed out the sunliquid licensing project in Slovakia. What is the current status of the project?

Christian Librera: Our partner Enviral acquired a sunliquid technology license as part of its goal to realize a commercial-scale plant for the production of cellulosic ethanol from agricultural residues. With an annual capacity of 50,000 tons, the plant will be owned and operated by Enviral and is planned to be integrated into the existing facilities at Enviral’s Leopoldov site in Slovakia. Clariant and Enviral are actively pursuing and continue to productively cooperate on this project under the concluded service and license agreement.

Robert Spišák: Enviral, a member of Envien Group, has submitted an application at the Innovation Fund Large-scale Projects. The RED II is in power, and since our new project is no longer only construction of advanced biorefinery, but also a significant upgrade and improvement of the existing conventional biofuel production in terms of energy and emission savings, we believe to succeed and become an example pillar for the Green Deal implementation and proof of good practice for others to follow.