212
As opposed to creating new standards for biofuel crop production, especially for
biofuels, the “meta-standard approach” makes use of existing standards for sustainable agriculture and forestry. The use of existing standards offers numerous benefits: assured reliability, easier acceptability to buyers, quick implementation, greater
cost effectiveness, less confusion between different standards, and promotion of
convergence (Committee on the Sustainability Criteria regarding Introduction of
Biofuels 2009).
C. Cost of Certification
Firstly, the cost of certification to producers consists of the cost of conforming to
standards and indicators plus the cost of acquiring certification. Although these
costs depend on the number, stringency, and comprehensiveness of the standards
and indicators defined by the certification system, production costs are likely to
increase substantially. In addition, the cost of certification is likely to be more burdensome in developing countries than in developed countries and to small-scale
producers than large-scale producers.
D. Connections to Trade
In the years ahead, the role of international trade is expected to become more important, which should lead to more effective utilization of biofuels. However, to assess
the connection of biofuels with WTO agreements, which set the general rules of
international trade, it should be noted that the present level of biofuel production
and international trade is relatively small and that certification systems for biofuels
are quite new. In view of this, there is not yet any established view how biofuel
certification systems can be dealt with under the current international trading rules
(UNCTAD 2008).
More specifically, there is no clear consensus about whether certification systems
developed by NGOs or other private organizations fall under WTO rules or whether
they should be regarded merely as marketing strategies. Although certification
serves to differentiate products based on their methods of production and their
LCA-determined impacts, any differentiation based on process and production
methods (PPM) may be in violation of WTO agreements. Also, there is still some
debate about whether certified biofuels can be justified as exceptions to the rules
(under Article 20 of GATT) as measures necessary to protect human, animal, and
plant life and health or measures to conserve limited natural resources. And doubts
remain about the differentiation of products on the basis that they meet a broad
range of objectives such as workers’ rights and food security or on the basis of their
production process. Note that no study appears to have been done on certification
systems in relation to government support schemes or subsidies in light of international trade agreements (UNCTAD 2008).
For example, under the EU Renewable Energy Directive, the standard relating to
biodiesel fuels stipulates that they should not be cultivated on converted peat lands
and that they should reduce CO 2 emissions by at least 50% relative to conventional
fuels on a life cycle basis. The directive recommends the use of a voluntary
certification system to prove these requirements. However, the Indonesian government
S. Arai and H. Matsuda
As opposed to creating new standards for biofuel crop production, especially for
biofuels, the “meta-standard approach” makes use of existing standards for sustainable agriculture and forestry. The use of existing standards offers numerous benefits: assured reliability, easier acceptability to buyers, quick implementation, greater
cost effectiveness, less confusion between different standards, and promotion of
convergence (Committee on the Sustainability Criteria regarding Introduction of
Biofuels 2009).
C. Cost of Certification
Firstly, the cost of certification to producers consists of the cost of conforming to
standards and indicators plus the cost of acquiring certification. Although these
costs depend on the number, stringency, and comprehensiveness of the standards
and indicators defined by the certification system, production costs are likely to
increase substantially. In addition, the cost of certification is likely to be more burdensome in developing countries than in developed countries and to small-scale
producers than large-scale producers.
D. Connections to Trade
In the years ahead, the role of international trade is expected to become more important, which should lead to more effective utilization of biofuels. However, to assess
the connection of biofuels with WTO agreements, which set the general rules of
international trade, it should be noted that the present level of biofuel production
and international trade is relatively small and that certification systems for biofuels
are quite new. In view of this, there is not yet any established view how biofuel
certification systems can be dealt with under the current international trading rules
(UNCTAD 2008).
More specifically, there is no clear consensus about whether certification systems
developed by NGOs or other private organizations fall under WTO rules or whether
they should be regarded merely as marketing strategies. Although certification
serves to differentiate products based on their methods of production and their
LCA-determined impacts, any differentiation based on process and production
methods (PPM) may be in violation of WTO agreements. Also, there is still some
debate about whether certified biofuels can be justified as exceptions to the rules
(under Article 20 of GATT) as measures necessary to protect human, animal, and
plant life and health or measures to conserve limited natural resources. And doubts
remain about the differentiation of products on the basis that they meet a broad
range of objectives such as workers’ rights and food security or on the basis of their
production process. Note that no study appears to have been done on certification
systems in relation to government support schemes or subsidies in light of international trade agreements (UNCTAD 2008).
For example, under the EU Renewable Energy Directive, the standard relating to
biodiesel fuels stipulates that they should not be cultivated on converted peat lands
and that they should reduce CO 2 emissions by at least 50% relative to conventional
fuels on a life cycle basis. The directive recommends the use of a voluntary
certification system to prove these requirements. However, the Indonesian government
S. Arai and H. Matsuda