Ambassador Bruton: U.S. Should End Anti-Competitive Biodiesel Export Subsidies

Ambassador John Bruton, Head of the EU Commission Delegation to the United States, expressed disappointment today at the failure of efforts to repeal anti-competitive U.S. biodiesel blending subsidies, which jeopardize the European biodiesel industry and leave U.S. taxpayers effectively subsidizing European motorists.

"The European biodiesel industry is being threatened by a flood of subsidized U.S. biodiesel," said Ambassador Bruton. "It is estimated that around 1 million tons of biodiesel entered the EU from the U.S. in 2007, roughly 15-20% of the EU biodiesel market and a tenfold increase over 2006."

A 2004 U.S. law encouraged U.S. diesel producers to blend more biodiesel into their fuel mixtures. Unfortunately, the tax credits in the law subsidize not only blended fuel destined for domestic U.S. consumption, but also biodiesel ultimately exported abroad. The $1.00 per gallon U.S. subsidy allows American exports to enter the EU market at a price below the raw material costs of European producers.

"What we are witnessing here is U.S. taxpayers effectively subsidizing European motorists to the tune of around $300 million last year. And that figure is set to be even higher this year - all while Americans themselves are suffering at the pump (…) As I work with Members of Congress in the coming months, I will continue raising this issue and push for a resolution."

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