Please find below the findings of ISCC’s investigations and Integrity Audits which were initiated due to the press release of the European Biodiesel Board as of 3rd March 2016.

Findings

• The Polish National Indicative Target (NIT) focuses on sales in the Polish domestic market. There is no requirement or indication that the Polish NIT reflects the amounts of biofuels actually consumed in the Polish domestic market
• Delivery documents and contracts for sustainable biofuels sold under the NIT did contain a reference or statement, indicating that the delivery has been used to fulfil the Polish NIT. It was understood that the intention of this statement was to prevent downstream operators, receiving the respective delivery, from using this delivery to fulfil quota obligations again in Poland or any other EU Member States. Such a reference or statement in the corresponding delivery documentation or contracts for sustainable biofuel is not prohibited by ISCC
• The handling of the quota obligation by the Polish authorities may therefore lead to a situation where quantities of biofuels counted under the Polish NIT are not necessarily consumed within the Polish domestic market but exported to other EU Member States with the risk of being counted there on the quota again
• The verification whether national procedures for quota allocation comply with the requirements of the EU Commission and the respective biofuels related Directives is neither within the scope nor the authority of the voluntary certification schemes recognized by the European Commission

Background

• According to ISCC requirements, the supplier of sustainable biofuel issues a sustainability declaration or Proof of Sustainability (PoS) to the recipient (buyer) to confirm that the requirements of the RED and of ISCC EU are met for the specific batch. The recipient can again sell the batch together with a PoS to another customer who may be located in a different EU Member State. A PoS can be used by quota obligated parties to demonstrate the share of sustainable biofuels towards the competent national authorities in EU Member States
• Under the recognized voluntary schemes the requirements for traceability and mass balance as laid down in the RED are subject to an audit at least every 12 months
• A PoS has to include specific information (e.g. type of material, country of biomass origin, GHG emission value, etc.). This verified by the auditor. A verification whether national procedures for quota allocation comply with the requirements of the EU Commission and the respective biofuels related Directives is not part of the audit procedures

After the allegations were raised by the EBB ISCC has taken the following actions

• ISCC has interviewed Polish economic operators, certification bodies and other stakeholders about the Polish market requirements and the role of different parties involved
• ISCC has contacted the Polish Energy Ministry to confirm ISCC’s understanding of the Polish market requirements. As of yet ISCC’s questions could not be clarified
• ISCC has contacted the Polish Energy Regulatory Office (URE) regarding amounts of biofuels used for the NIT that were reported to URE by ISCC certified quota obligated parties. According to a letter from URE to ISCC as of 19 April 2016, the respective legislation does not provide the option to make this information available to third parties
• ISCC has conducted Integrity Audits at Polish system users in the middle of April. No non-conformities have been found