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Call for EU to stop subsidies for fossil fuels to help bio-based materials sector and the circular economy.

“Please stop all subsidies to fossil fuels. In 2016, €56 billion went from EU member states to fossil fuels.”

EU member states need to stop subsidising fossil fuels in order to help the bio-based materials industry, according to an industry expert. Roberto Ferrigno, EU Policy Advisor at Italian bio-plastics company Novamont, aired the latter views at a recent European Commission-backed ‘Circular Economy Stakeholder Conference’ in Brussels. He spoke on a panel with five other industry experts on a topic entitled ‘Policies to continue the transition: Towards circular industrial value creation networks’.


When asked by the host what one thing the next European Commission (@EU_Commission) and Parliament (@Europarl_EN) should do to encourage the transition to the circular economy, Ferrigno said that the EU should be “designing for sustainability” and designing for “safer chemicals and safer products”. He went on to say: “Please stop all subsidies to fossil fuels. In 2016, €56 billion went from EU member states to fossil fuels.”

Ferrigno said if subsidies were stopped for fossil fuels then it could also support the bio-based industry by making the cost of bio-materials cheaper than fossil fuel-based ones.

His answer also came off the back of a question asked by Kevin Gao, Communications Manager at Ellen MacArthur Foundation’s China programme, about the circular network for plastics packaging.  Gao said that he was helping the Chinese government to develop a plastics strategy, which was due to be published by the end of this year

He said he had talked to the Chinese Packaging Federation, who had expressed concerns around the cost of bio-degradable plastics and maintained that the switch from conventional plastics to bio-degradable ones could increase costs by “four times” in China – “a cost that industry could not bear”. He asked the circular economy panel for a solution.

The issues surrounding the circular economy, plastics packaging and subsidies to fossil fuels come at a time when EU policymakers prepare for upcoming European Parliament elections, which are due to take place in May.

Transition to a circular economy

Earlier this year, a European Commission report warned that the total subsidies for coal, oil and gas across the EU remained at the same level as 2008. This is despite both the EU and G20 pledging to phase out the subsidies, which could hinder the swift transition to a circular economy needed to tackle climate change.

At the circular economy event, Ferrigno maintained that cheap oil and short-term thinking from politicians and planners were creating challenges for circular industrial value creation networks.

Ferrigno outlined how Novamont (@Novamont) develops and produces bio-plastics and bio-chemicals through the integration of chemistry, the environment and agriculture. When deciding to build its plants, it specifically focuses on building them on derelict industrial sites in order to help with the regeneration of industrial sites and the local economy. It currently has four biorefineries in Italy.

Speaking about the background story to Novamont’s formation and its focus on the circular economy, Ferrigno said: “We have come here from a long way. In our case it was the dismantling of the chemicals industry in Italy in the 80s. We lost hundreds of thousands of jobs because the Italian chemicals industry was not competitive anymore.

“The legacy of this for the traditional chemicals industry was tremendous, not just in terms of job losses, but in terms of pollution and in terms of health consequences for the workers and the population around the facility. This led us to rethink the way we reconnect chemistry with the people. This is the reason that brought us to this experiment.”

Carbon tax

Elsewhere, Frans Timmermans (@TimmermansEU), First Vice-President of the European Commission, was also speaking at the circular economy conference, but gave the opening speech ahead of the panel debate.

“We need to urgently look at taxation. How is taxation supporting our efforts to go to a circular economy? It’s a big question. Do we need a CO2 tax at a European level? I think we probably do. We need to ensure that a tax system we use creates a feeling in society that this transition is being dealt with in a fair way.”

Separately, the European Commission has recently published a comprehensive report on the implementation of the Circular Economy Action Plan it adopted in December 2015. The report presents the main results of implementing the action plan and sketches out open challenges to paving the way towards a climate-neutral, competitive circular economy where pressure on natural and freshwater resources as well as ecosystems is minimised.


You may also be interested in reading…

Read: Expert View: Five ways biotech supports the transition to a more circular economy.

Read: Integrating circular economy and bioeconomy would improve European sustainability; report.

Read: Prince Charles demands faster shift from linear to circular economy.

Read: Supermarket giants gain compostable bag boost with the aid of expanded Novamont plant.

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