Hamburg: Germany’s federal cabinet has approved a draft biofuels law that maintains the use of food- and animal feed-based ingredients in the country’s biofuel mix, the environment ministry announced on Wednesday, reports Reuters.
Biofuels—including biodiesel and bioethanol—play a key role in Germany’s greenhouse gas (GHG) reduction strategy for road transport. Oil companies are required to meet GHG reduction targets, which they partially fulfil by blending fossil fuels with biofuels made from feedstocks such as rapeseed oil, waste vegetable oil, grains and sugar.
The previous coalition government, which included the Greens and left office after the February general election, had proposed phasing out biofuels derived from food and feed crops. The newly approved draft law reverses that trajectory, stating that such feedstocks will continue to be permitted at current levels.
However, starting in 2027, palm oil will no longer be eligible to count toward emissions reduction obligations due to environmental concerns linked to palm cultivation.
The draft legislation also formally transposes the European Union’s Renewable Energy Directive (RED) into German law for the transport, electricity, and heating sectors. The measure had faced repeated delays, and has now been forwarded to parliament for approval.
The law proposes limits on “double-counting”—a mechanism that allows certain advanced or waste-based biofuels to be credited twice toward compliance targets. Restricting this practice is expected to shift demand patterns within the biofuels market. “There is overall relief that food and feed based ingredients will continue to be used while the end of double-counting will also be positive,” a German rapeseed trader said, noting that the policy is likely to support rapeseed oil and biofuel prices.
