Future bioenergy trade in the EU: modelling trading options from a cost-effectiveness perspective

Abstract

The purpose of this paper is to analyse under what conditions, with respect to CO 2 emission-reduction and biofuels-for-transport targets, the trading in the EU of CO 2 credits and solid and/or liquid biofuels is cost-effective from the perspective of an optimisation energy systems model. We use the PEEP model covering the EU27 (except Bulgaria, Malta, and Cyprus) to generate insights about the cost-effectiveness of different options under different policy scenarios. Trade in CO 2 credits is a cost-effective option, in all relevant policy scenarios. Trade in some biofuels (mainly from central and eastern European countries to the EU15) is cost-effective in all assessed scenarios. In the case of CO 2 targets (whether national or at the EU level) there is trade in solid biofuels. When biofuels-for-transport targets are also implemented, trading both solid and liquid biofuels is cost-effective.