Regulation as a bottleneck

Ancient regulation might stand in the way of biobased economy development in many forms. These bottlenecks differ among countries; here we offer an overview with some examples.

Waste regulation
Waste regulation is intended to serve public health. Manure and offal are examples of biobased resources posing a threat to public health. Strict regulation primarily serves the purpose of preventing the outbreak of diseases upon negligent handling of these products. But in certain areas, these regulations have weird consequences. Processing substances marked as waste is the prerogative of companies having a special permit. In one instance, this meant that processing sugar beet fibres to paper was not allowed, because they were marked as waste as soon as they left the sugar factory. In another instance, a company could not use onion peels to produce dyestuff.
•    Companies wishing to process substances marked as waste may run into trouble because they would need permits.
•    Food processing companies do not wish to be perceived as being into waste processing, and for that reason sometimes forego the possibility of using substances which would not pose any harm at all.
•    Regulation stands in the way of reuse of minerals reclaimed from indigenous biomass, among them phosphate. This is an undesired consequence, as phosphate resources are limited, while at the same time phosphorus is an essential element in food and feed.
•    Digestate, the waste stream from anaerobic fermentation, consists of minerals, organic acids and undigested organic substances. It is an organic fertilizer. But in some countries, this application is forbidden by regulation, even though these rules do not apply for organic manure.
In short: present waste regulation is not yet based on the idea that waste may be a feedstock.

Ambiguous GMO regulation
Companies wanting to employ Genetically Modified Organisms (GMO’s) run into regulatory trouble. Regulatory bodies do not always have the expertise to handle these applications in the right way, whereas companies are dependent upon this expertise because often, these rules and laws are ambiguous.

Level playing field
Biomass projects often run into unlevel playing fields. For all practical purposes, Europe mainly promotes the use of energy from biomass. This is the case, for instance, when biobased electricity is subsidized and biofuels are regulated to be an increasing part of the national fuel mix. This effectively stands in the way of biomass use for purposes higher up in the value pyramid (materials, chemicals, food and feed) because of a growing scarcity of the resource, and higher prices. Biogas production shows another way of market distortion; subsidies direct biogas to the electricity production market, while system studies indicate that it might be used more profitably as a transport fuel.

Levies and excises
In the EU, imports of foodstuff often carry a levy. For example bioethanol. This puts bioethylene production from bioethanol at a disadvantage: the competing resource (naphtha from crude oil) does not carry a levy.
These import levies even regard waste streams from food processing. For example, RWE/Essent abandoned its plan for electricity production from inedible rice peel, upon regulation of these peels as foodstuff which would carry a levy.
Excise for transport fuel is calculated per unit of volume. Ethanol has a higher volume per unit of energy production than petrol; as a consequence, drivers pay more excise as the amount of ethanol in their fuel increases.

Lack of regulation
New processes and products might not have been regulated properly as yet. Regulatory bodies often do not know how to handle these situations. This could mean that an entrepreneur, faced with the choice between biogas fermentation and pyrolysis, might choose the former merely because this would entail much less regulatory problems.

Courtesy WTC, Dutch Scientific and Technological Committee for the biobased economy

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