Targets and mandates: lessons learned from EU and US biofuels policy mechanisms

Abstract

The United States and the European Union have taken different paths in the design and implementation of biofuel policy measures. In the European Union, a target has been set for the contribution of renewable energy in transport use, but policy implementation mechanisms are diverse and decentralized. Mandatory targets have been approved voluntarily by several EU Member States, but these mandatory targets are national initiatives and not an obligation from the European Union. The US biofuel policy has specified targets in absolute quantities rather than in percentages of use, as was done in the European Union. Because of this quantitative target and the fact that the implementation is through a mandate rather than a less-binding target, compliance is assured, but different implementation problems may arise that may not occur in the EU system. In this article, we provide an analytical discussion on lessons learned from the current and previous EU and US biofuel policy mechanisms and consider the possibilities, opportunities, and challenges for future policy development in both economies.