The European Parliament is losing the battle on limiting the use of food-based bio-fuels, after it made major concessions to member states following negotiations with the Council, according to a leaked document seen by EurActiv.com.

A draft law capping the use of bio-fuels derived from food crops is currently being negotiated in so-called trilogue talks between legislators (the Commission, the Parliament and the EU Council representing member states).

The use of bio-fuels was encouraged in 2009, when the EU mandated a 10% share for renewable energy in the transport sector. The law was blamed for pushing up food prices and leading to deforestation outside of Europe, where land is being cleared up to cultivate energy crops.

As green groups rang the alarm over the environmental damages of bio-fuels, the European Commission proposed a new law restricting fuels made from food crops. But while member states agreed to a 7% cap on this type of bio-fuels, the Parliament sought to tighten that target to a maximum of 6%.

In Brussels, the trilogue negotiations currently taking place are proving tricky, with member states piling pressure on the Parliament to make concessions. Disagreement centers on the cap, the accounting of emissions from alternative fuels, and the sustainability of advanced bio-fuels.

Instead of a 6% cap on food-based bio-fuels, the Council is pushing for a more flexible 7% cap, which the Parliament accepted, according to a leaked version of the draft agreement. Latvia, which currently holds the rotating Presidency of the EU, suggested “an optional application of the cap for conventional bio-fuels” instead of an obligatory one, the draft says.

The Council is also winning the argument over how emissions related to indirect land use change (ILUC) should be accounted for.

Deforested land releases high amounts of greenhouse gas after the trees have been cut down. Parliament, supported by environmental campaigners, pushed for these emissions to be accounted for, but the Council refused to include them from calculations of carbon emissions.

Provisions on so-called advanced bio-fuels, made from woody biomass, which do not compete with food crops, are also keeping the negotiators busy. The Council is not ready to accept the Parliament’s suggestion for a binding target of 1.25% for advanced bio-fuels, pushing instead for a non-binding target of 0.5% .