Biofuel Policy Brief - November 2025

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Dear reader,

November reconfirmed that the biofuel policies of our times are driven by national considerations more than multilateralism. Global climate cooperation mechanisms (COP30, IMO, CORSIA, G20) failed to drive change. Even EU policymakers - normally the exception to this rule and a climate-ambitious international bastion - mainly agreed on what policies to delay this month. That did not stop Germany and the Netherlands from going above and beyond the minimum RED III requirements, while other countries around the world keep strengthening existing mandates or introducing new ones. Climate targets are one reason for doing so, but supporting domestic industry remains a major priority in current day biofuel policies as well, as seen in UK, US and Brazilian biofuel trade policies this month.

Key policy developments in November:

• COP30 closed without any deal on phasing out fossil fuels. Weaker global climate policy momentum was also reflected in this year’s IEA world energy outlook, though biofuel demand grows above 3% CAGR through 2035 even in its most pessimistic scenario.
  

• EU legislators agreed on the bloc’s 2040 climate targets, announced low carbon fuel production tax credits, clarified e-fuel emission reduction methodology, and likely will delay ETS2 and the deforestation regulation by one year.
  

• Germany’s latest RED III transposition draft includes impactful changes, with only the road sector in scope now, total mandates and advanced submandates increasing, e-fuel mandates decreasing and feedstock eligibility tweaked. France, the Netherlands Belgium, Latvia and Italy implement changes to their biofuel policies too.

  
  

• The UK trade agency imposed tariffs on Chinese biomass-based diesel exporters that mirror similar measures by the EU already in place, indicating it will be effective in reducing trade flows.
  

• US rumors about a 1-2 year delay to foreign biofuel disqualification cause speculation as the market eagerly awaits whether the ‘26-27 federal mandates will be finalized in time now that the government shutdown is lifted.

  
  

• Indonesia’s B50 program will be rolled out in H2 ‘26 and Vietnam’s E10 mandate in June ‘26. Malaysia and the UAE get more concrete about their SAF mandate plans.
  

• Brazilian policymakers aim to ban biodiesel imports, while the country’s Constitutional Court upheld the RenovaBio transport emission reduction obligation .

Global climate and trade policies

The UN COP30 climate summit in Brazil ended without a fossil fuel phase-out deal. Although more than 80 countries were in favor of such a deal, large fossil producing countries were effective in obstructing it. The failure to reach ambitious COP commitments is another symptom of the weaker momentum in global climate coordination. With the US absent in the best case, or actively blocking progress just as frequently, other countries are having to pick their battles and real leadership is lacking. The COP30 presidency commitment to create a roadmap on the topic outside the formal negotiations, is a potential lifeline for those still hoping for adoption. However, it is also reminiscent of last month’s IMO negotiations around shipping decarbonization, where a vital vote was postponed by a year without guarantees that anything will have changed by then.

The weakened global climate policy momentum pushed the flagship IEA World Energy Outlook (WEO) 2025 to revise its core scenarios. The WEO is an annual stocktake of global energy policies along with their projected impact on the market via three core scenarios. Since 2020, all three scenarios had assumed that decarbonization policies would continue to strengthen one way or another. Now for the first time in half a decade, the IEA reintroduced a scenario in which current climate policies do not significantly strengthen, while omitting the scenario where all announced climate pledges are met. This shifts the centre of gravity of the outlook towards a less climate ambitious world. However, the outlook for biofuels remains robust even in the least ambitious scenario. In fact, the IEA sees biofuels being indirectly supported by the slower uptake of electric vehicles and hydrogen-derived fuels in this scenario, due to the larger base fuel pools and lack of alternatives. The IEA projects global biofuel demand between 2024-2035 to grow by 3.2% CAGR under the current policies scenario and a slightly lower 3.1% CAGR under the more climate ambitious stated policies scenario.

Still in the sphere of global decarbonization policies, the UN’s aviation body (ICAO) this month approved carbon capture and storage (CCS) as an eligible pathway towards CORSIA, as well as extending eligibility of a number of voluntary carbon standards. Under CORSIA, countries have committed to carbon neutral growth in international aviation. Given that aviation is projected to be one of the fastest growing sectors in the coming decades and with no electrification in sight for the industry, it may sound like the scheme could incentivize SAF. This is not quite the case however, due to eligibility of cheap offsets outside the aviation sector. This month’s ICAO decisions confirm that is unlikely to change any time soon.

November’s most significant trade policy announcement for biofuels was the UK’s decision to impose anti-dumping duties on Chinese biodiesel and renewable diesel. Effective from Wednesday 25 November, duties between 14.79% (for some cooperative producers) and 54.64% (for all other producers) will apply. These levels and producer-specific setup are comparable to EU anti dumping duties against Chinese producers last year. Based on the lessons learned from the EU tariffs, the UK’s tariffs are high enough to reduce Chinese biomass-based diesel imports to multi-year lows, albeit without fully closing arbitrage. Also similar to the EU’s approach, is that SAF is excluded from the tariff scope for now, potentially creating somewhat of a loophole for Chinese HVO producers to shift their output towards HEFA to target the mandated UK SAF market. In parallel, news emerged that the UK Trade Remedies Authority plans to recommend the introduction of countervailing duties on US-origin HVO. These duties would range between USD 341-402/tonne, depending on the producer. US HVO producers have flooded the UK and Norwegian market in recent years, with arbitrage to the EU being more closed due to the existence of duties. Still on the trade front and ending this international section where we started it, Brazilian president Lula stated that the EU-Mercosur trade agreement will be signed on 20 December. The deal has been 25 years in the making and includes significant low-tariff quotas for Brazilian ethanol to the EU. For this to happen successfully, the EU parliament as well as a qualified majority of member states in the Council will need to agree, neither of which can be taken for granted at this stage.

Europe

It has been an active month for EU legislators. Not only did they agree on the terms of the Union’s 2040 emission reduction target, they also announced significant production incentives for e-fuels, made decisions on delayed implementation of ETS2 as well as the deforestation regulation (EUDR), and released a delegated act on low carbon hydrogen GHG methodology. Meanwhile RED III transposition keeps progressing on the national level, with the most impactful twists and turns this month in Germany.

EU environment ministries finally agreed on the 2040 GHG targets. The Commission’s original 90% target is kept, albeit with up to 5% met through ‘high quality international credits’. The international credits are a compromise to meet concerns by several central and eastern European countries as well as France and Italy, that meeting the full 90% within the EU economy would have an outsized effect on prices and competitiveness. Still, it remains an ambitious target that can serve as a solid basis for any successor to RED III. The EU Commission is expected to start working on this ‘RED IV’ framework early 2026.

In parallel and on the same day, EU ministries requested to delay the implementation of the ETS2 system by one year, meaning from 2028 rather than 2027. ETS2 will be an upstream emission trading system for road fuels, buildings and small industries. The scheme will effectively help bridge the price gap between fossil fuels and lower carbon alternatives such as biofuels. A potential one year delay has always been included in the design of the system, albeit through an EU Commission review by July 2026 based on energy price levels, rather than being initiated by the member states as is the case now. For the ETS2 delay to be final, the EU parliament will need to agree. On Friday, this same parliament agreed with a one-year delay of the EUDR, preventing stricter due diligence requirements for imports of e.g. soy, oil palm and wood products to take effect on 31 December this year. Instead, large companies will need to comply from 30 December 2026 and smaller ones on 30 June 2027.

The EU Commission unveiled a new EU Sustainable Transport Investment Plan (STIP), aiming to provide financial support for e-SAF and e-maritime fuel producers through various funding rounds that add up to roughly EUR 1 billion in auctions through the European Hydrogen Bank. This is in addition to the EUR 2 billion the Commission wants to mobilise from the InvestEU scheme for sustainable fuels, which could include e-fuels as well as biofuels. By this approach, the EU aims to provide some counterweight to clean fuel production tax credits in the US, while also attempting to induce some actual FIDs in e-fuel projects. E-fuel uptake has a direct impact on the EU biofuel market, as both contribute to the same total transport emission reduction or renewable content mandates, as well as combined submandates for advanced biofuels and e-fuels (RFNBOs). Latest in 2026, there will need to be a wave of e-fuel FIDs in order to be ready for the dedicated sub-obligations by the end of the decade. The sector often cites regulatory uncertainty as a reason why there have been no FIDs to date. What will perhaps help in this regard, is a delegated act that the EU Commission released this month around RFNBO GHG methodology.

A leaked draft of the German THG legislation includes several notable changes from this summer’s proposal. Only the road sector is in scope according to this latest draft, leaving out aviation and maritime sectors. Total emission reduction obligations are higher for 2027-2028 and for the post 2030 period compared to the June proposal. Annex IX-A submandates are substantially higher from 2027, while RFNBO mandates are much lower from 2030. The food cap is now kept at 4.4% for the coming 15 years, while under the June proposal it was set to drop to 3% between 2028-2030 and remain at that level throughout the 2030s. Ineligibility of POME and EFB as feedstocks and the condition to allow for on-site inspections are all pushed back to 2027 rather than from 2026. Soy now appears to remain eligible as biofuel feedstock, whereas in June the idea was still to ban it. Annex IX-B feedstocks would be eligible for co-processing now, whereas this was reserved exclusively for Annex IX-A in the June draft. It is looking less and less likely that the final legislation will be in place by 1 January 2026, as the federal cabinet keeps delaying discussion of the subject - with the latest agenda indicating that the topic will be delayed this week once more. Several readings by the Bundestag are likely required after that. Retroactive application may be possible from 1 January even if the legislation is finalized after that date.

Dutch RED III transposition enters its final legislative sprint, without major changes expected to the setup yet topics like bio-LNG mass-balancing still being under discussion. The Netherlands has the highest advanced biofuel mandates proposed in Europe, including for shipping, but while bio-LNG would be well placed to fulfill the shipping mandate the very low temperature at which fossil-LNG is typically imported make the logistics tricky for actual physical blending of this fuel. Belgian’s consultation on its RED III implementation proposal ended this month, with changes possible based on the feedback received. Only time will tell what these changes could look like, but one thing the Belgian government has already clarified is that the RFNBO multiplier for the maritime sector will be increased to 3 from 1.5 in its earlier proposal.

The French National Assembly voted against a proposed hike on high-blend biofuels, while voting in favor to add high HVO blends to the list of such tax-advantaged fuels. High biodiesel (B100) and ethanol (E85) have been tax-advantaged for many years in France, with the latter in particular having been successful in its availability and uptake. Under the 2026 budget law however, a four-fold increase for both of these was proposed, which was thus rejected by the National Assembly. A few weeks later, this same body voted to also give preferential tax treatment to HVO, even though it does not face the same restrictions in terms of engine compatibility as these other high-blended biofuels. In theory, the French government can still override both of these decisions.

The UK Department for Transport has updated the list of feedstocks qualifying for the RTFO biofuel and SAF mandates. It added contaminated crude methanol (double-counted), residue from high grade and beverage ethanol production, and papermaking wastewaters (double-counted and counting to development fuel submandate). Meanwhile the Latvian parliament has approved the country’s RED III transposition draft, which among other things includes e.g. a 16% transport emission reduction obligation, thereby being somewhat more ambitious than the EU minimum requirement of 14.5%. Last but not least, the Italian Ministry of Infrastructure and Transport signed into law a decree that is meant to broaden the qualification of vehicles that can run on high biofuel blends such as B100.

North America

The US emerged from a record-long government shutdown mid-November, without a clear winner on either side of the bipartisan system, yet just in time for normal food aid and air traffic to resume ahead of the country’s Thanksgiving holiday. Partly as a consequence of this, there appears to have been little official progress towards biofuel legislation this month, fueling speculation about rumored delayed CFPC import restrictions and raising fears that the EPA may not finalize its 2026-2027 RVOs before the end of the year. Even at the top diplomatic level, the US mainly made headlines due to its absence this month at the COP30 and G20 meetings of international leaders - although this cannot be attributed to the government shutdown, but rather reflects a general disinterest in multilateralism of the current US administration.

Reuters quoted anonymous EPA sources who claim the Trump administration is considering delaying disincentives for imported biofuels by one or two years. According to the current 2026-2027 RVO proposal, biofuels from imported feedstocks and imported biofuels will only qualify for 50% from 1 January 2026. Combined with their disqualification towards clean fuel production tax credits (CFPC), this would put immense pressure on domestic feedstocks and lead to a major price spread between US and non-US feedstocks. What is more, many analysts agree that there simply would not be enough domestic feedstocks to meet the ambitious biomass-based diesel RVO mandates. From that perspective, the rumors seem credible in that they would solve the feedstock supply issue and that most oil refiners would presumably back such a delay as it would keep renewable fuel costs more manageable.

Only a month remains for the US administration to decide on the final RVO setup before the new mandates are set to kick off. If the rules are not finalized before that, retroactive implementation may be complicated by the fact that courts only allow for this if the EPA somehow mitigates any hardship caused by delays. That said, there have been plenty of historical precedents where the EPA has done so, including in 2020-2022. Another major outstanding question is how small refinery exemptions (SREs) will be dealt with, and the extent to which they will need to be compensated through higher obligations for larger refineries.

Asia

Mandate news for biofuel mandates in all major fuel segments this month in Southeast Asia and the Middle East. While Indonesia and Vietnam specify a specific 2026 timeline for their respective B50 and E10 mandate plans, Malaysia and the UAE are getting more serious about their own SAF mandate ambitions.

Indonesia’s plan to increase its current B40 mandate to B50 sometime in 2026 has been known for a while. The country’s Energy Ministry this month specified that it is planning to roll out the program gradually in H2 of next year. A topic which it has yet to decide on, is whether the program will immediately apply to all sectors, or whether e.g. public transport will have a longer grace period. Key factors in this decision will likely be the spread between diesel and palm oil prices, as well as feedstock availability. Indonesia is by far the largest producer of palm oil globally, which in turn is the largest vegetable oil in terms of annual production. The country’s biodiesel mandate, which will already translate to nearly 14 million tonnes this year, therefore has a direct impact on global feedstock and biofuels prices.

Vietnam’s Ministry of Industry and Trade announced the country will roll out E10 nationwide from June 2026. E10 has already been piloted by major distributors Petrolimex and PV Oil since August 1 in Ho Chi Minh City, Hanoi and Hai Phong.

Malaysia’s Plantation and Commodities minister announced that the country will move forward with its SAF mandate plans, initially by obliging international flights from Kuala Lumpur airport to blend 1% SAF. The country also sticks to its 47% SAF target by 2050, albeit not yet in mandate. Similarly, the UAE’s undersecretary for Energy and Petroleum Affairs announced that the country is working towards implementing an official SAF. Currently the UAE only has a soft target of 1% SAF by 2031, but so is now looking to introduce a mandatory requirement. More details are to be fleshed out the coming year, including whether to introduce a similar SAF levy as Singapore to fund the initiative. The UAE is the latest example of an airport hub connecting Europe and Asia (via Dubai) with SAF mandate plans, after Turkey (Istanbul) announced mandate plans of its own recently as well.

Latin America

Brazil’s Mines and Energy ministry this month opened a call for public comments on banning biodiesel imports. Currently, obligated parties can import up to 20% of their biodiesel volumes on the spot market. In practice, import volumes have remained low as Brazil is quite a low cost biodiesel producer and tariffs do already apply, thus international players have not been able to be competitive on the Brazilian market. With these measures, it appears the Brazilian government wants to keep it this way even when the Brazilian mandates increase further while global exporters that formally targeted the US market need to find new outlets, seeieng as the US is also introducing measures of its own meant to halt imports. If the proposal is approved, the resolution is scheduled to come into effect on 1 March 2026. In parallel, Brazil’s Supreme Court has largely held up Renovabio - the program that mandates emission reduction obligations for transport fuel suppliers. Two of the country’s political parties had questioned the legality of the program through court, but so failed to revert it.