LATEST DEVELOPMENTS IN THE SPANISH BIOFUELS SECTOR

Transcription

1 LATEST DEVELOPMENTS IN THE SPANISH BIOFUELS SECTOR APPA BIOCARBURANTES National Biofuels Associations Network 14 March 2012 Barcelona

2 Presentation Outline I. Update on the Spanish biofuels market 1. Production 2. Consumption & blending mandates 3. National RES-T targets for Fiscal incentives 5. Imports & Exports 6. Measures to prevent disloyal imports 7. Higher biofuels blends (technical specifications and use): B10, B20, B30, E10, E85 8. HVO & Other biofuels 9. Feedstocks II. Main regulatory developments 1. Implementation of the RED sustainability requirements 2. Double-counting 2

3 I. Update on the Spanish biofuels market

4 I.1. Production: Biodiesel Evolution of the annual biodiesel production in relation to installed capacity Source: APPA Biocarburantes & CORES & AEAT mt % 12% 15% 28% 14% Production (mt) Capacity (mt/y)

5 I.1. Production: Bioethanol Evolution of bioethanol production in relation to installed capacity Source: APPA Biocarburantes % 60% 79% 80% 78% mt Production (mt) Capacity(mt/y)

6 I.2. Consumption: Biodiesel Evolution of annual consumption of biofuels in diesel in Spain Source: APPA Biocarburantes & CORES mt Biofuels in diesel cons. (mt)* * Figures for 2011 include the consumption of HVO 6

7 I.2. Consumption: Bioethanol Evolution of annual bioethanol consumption in Spain So urce: CORES mt Bioethanol consumption (mt)

8 I.2. Mandatory biofuels consumption targets Overall target* 6,2% 6,5% 6,5% Biofuels in diesel target* 6,0% 7,0% 7,0% Biofuels in petrol target* 3,9% 4,1% 4,1% *In energy content Limited flexibility as regards the type of biofuel to use to reach the global targets 8

9 I.3. National RES-T targets for 2020 Targets and trajectories for biofuels in the Spanish National Renewable Energy Action Plan (NREAP): Spain set a relatively high target compared to other MS: 13,6% RES in transport in ktoe More than 87% would come from biofuels Electric vehicles (EV): modest share despite overly optimistic estimate (2,5 million in 2020) Negligible contribution of biofuels other than biodiesel and bioethanol 9

10 I.3. National RES-T targets for 2020 Targets and trajectories for biofuels in the Spanish Plan for Renewable Energies : The target is reduced compared to the NREAP: 11,3% RES in transport in ktoe 81% of the target will come from biofuels: ktoe biodiesel 200 ktoe 2nd generation 400 ktoe bioethanol 52 ktoe 2nd generation Although certain measures to develop higher blends are considered, the biofuels consumption targets are unjustifiably reduced and insufficient. 10

11 I.4. Fiscal incentives Tax exemption for all types of biofuels incorporated into diesel and gasoline until 31 December 2012 It is highly likely that this tax exemption will not be extended beyond this date APPA Biofuels has repeatedly asked the government to extend this fiscal incentive until 31 December 2018, at least for higher blends and second generation biofuels 11

12 I.5. Imports: Biodiesel (1) Evolution of the consumption of biofuels in diesel in Spain by origin Source: APPA Biocarburantes & CORES&AEAT % 74% % mt % 63% % Biodiesel imports (mt) Rest of national cons. (mt)* * Figures for 2011 include the consumption of HVO 12

13 I.5. Imports: Biodiesel (2) Evolution of pure biodiesel imports from Argentina and Indonesia Source: AEAT mt Argentina Indonesia

14 I.5. Imports: Bioethanol Evolution of annual bioethanol consumption in Spain by origin Source: APPA Biocarburantes & CORES 45% 45% % mt Imports (mt) National production (mt)

15 I.5. Exports: Biodiesel Evolution of Spanish biodiesel exports Source: AEAT mt Exports (mt)

16 I.5. Exports: Bioethanol Evolution of Spanish bioethanol exports Source: APPA Biocarburantes % 34% 54% 48% 46% mt Exports (mt) Spanish market (mt)

17 I.6. Measures to prevent disloyal imports (1) 74% of all biodiesel consumed in Spain in 2011 was imported, mostly from Argentina (59%) and Indonesia (27%) Urgent measures against unfair biodiesel imports are necessary Draft ministerial Order to prevent disloyal competition from third countries: Allocation of biodiesel quantities to approved EU production plants to achieve national objectives The quantities to be allocated are twice higher than the national biodiesel demand fair competition is ensured The system would run for an initial period of 2 years, may be extended to 2 more 17

18 I.6. Measures to prevent disloyal imports (2) Strong pressures from Argentina have led to a very long delay in the adoption of this Draft Ministerial Order Many of the 51 biodiesel plants had to either stop their production or go into liquidation. Investments of million euros and qualified jobs are currently at risk Possible solutions at EU level? 18

19 I.7 Higher biofuels blends (1) Technical specifications in Spain: There are currently no technical specifications for higher biofuel blends (B20, B30, E85) However, one of the key measures proposed by the Spanish Renewable Energy Plan was to adopt national technical specifications for these blends, given the little progress achieved in CEN and the need to boost their consumption in Spain 19

20 I.7 Higher biofuels blends (2) Technical specifications: the CEN work CEN is working on the development of EN 590 diesel specifications to allow up to 10 % (V/V) FAME, following the Commission Mandate to CEN in Some vehicle manufacturers have claimed that certain types of diesel particulate filters (DPF) systems are unable to use more than 7% (V/V) FAME due to increasing engine oil dilution and proposed to the Commission not to develop the B10 specification in EN 590 and to create a separated standard. Enquiry period of EN 590 that introduces 2 tables (B7 and B10) finished on 6 March The result of the vote was 20 Yes, 3 No (Austria, Germany and Sweden) and 7 abstentions. Technical and editorial comments have been submitted. 20

21 I.7 Higher biofuels blends (3) Use: Consumption of B100 in Spain So urce: CORES mt % 96% 97% 98% B100 (mt) In blends (mt)* * Figures for 2011 include the consumption of HVO 21

22 I.7 Higher biofuels blends (4) PETROL STATIONS 34 petrol stations sell E85 in Spain (Source: Abengoa Bioenergía) 390 petrol stations sell higher biodiesel blends (Source: MINETUR, March 2012)

23 I.7 Higher biofuels blends (5) Use: Due to statistical limitations it is very difficult to estimate the exact consumption of higher biodiesel and bioethanol blends. The number of petrol stations offering higher biodiesel blends decreased by 16% between October 2010 and March 2012 The modest use of these blends could be attributed to the following reasons: The price difference between higher blends/diesel or gasoline is not attractive enough for consumers No incentives for consumers and car manufacturers Lack of information on the cars which could run on higher blends and on the benefits of higher blends in general 23

24 I.7 Higher biofuels blends (6) APPA Biofuels believes that several tools need to be established to incentivize the wider use of higher biodiesel blends: Mandatory use of higher blends in all public transports fleets. Gradual introduction of higher blends in all petrol stations. Incentives for vehicle manufacturers to guarantee their vehicles for the use of higher blends. Encourage the acquisition of these vehicles by establishing exemptions in car taxes (registration ) and direct purchase subsidies. 24

25 I.8 HVO & Other biofuels The consumption of HVO in Spain started in July 2011, after the energy content of this biofuel (0,8121 toe/m3) was included in the Ministerial Order that establishes the mechanism of biofuels obligations. HVO is co-processed in several Spanish oil refineries (CEPSA and REPSOL) and also imported. In 4 months (from July to October 2011) the HVO consumption in Spain reached m3 (approx tons), which represents around 6% of the biofuels consumed in diesel. 25

26 I.9. Feedstocks (1) Feedstocks of the biodiesel produced in 2010 (Source: CNE, 2012) 26

27 I.9. Feedstocks (2) Feedstocks of the biodiesel consumed in 2010 (Source: CNE, 2012) 27

28 I.9. Feedstocks (3) Feedstocks of the bioethanol produced in 2010 (Source: CNE, 2012) 28

29 I.9. Feedstocks (4) Feedstocks of the bioethanol consumed in 2010 (Source: CNE, 2012) 29

30 II. Main regulatory developments

31 II.1. Implementation of the RED sustainability criteria (1) The RED sustainability criteria will be transposed via: Royal Decree 1597/2011 published on 5 November 2011 Additional legal acts to be adopted in 2012 Shared responsibility of the Ministry of Industry, Energy and Tourism (MINETUR) and the National Commission for Energy (CNE) Royal Decree 1597/2011on Biofuels Sustainability Literal transposition of the sustainability criteria in the RED Compliance with sustainability criteria required as of 1 January 2013 Three mechanisms to show compliance: national systems, voluntary schemes, bi/multilateral agreements 31

32 II.1. Implementation of the RED sustainability criteria (2) The national system will be integrated into the current certification system for the biofuel consumption targets, managed by the CNE Transition system until the approval of all necessary legal acts and the accreditation of the first confomity assessment bodies During the transition system, all economic operators (from the farmer to the obligated party) need to sign self-declarations which will be passed on to the obligated party, who reports to the CNE Final system: regular checks throughout the year by accredited conformity assessment bodies 32

33 II.1. Implementation of the RED sustainability criteria (3) To be defined: The rules for the implementation of the mass balance system (reference period, definition of site, information allocation to outgoing consignments etc.) Frequency of reporting to the CNE Content of self-declarations, provision of additional proofs Treatment of consignments certified under voluntary schemes 33

34 II.1. Voluntary schemes to certify biofuels sustainability RBSA 7 voluntary schemes have been recognized by the EC in July 2011 Next schemes to be approved possibly in July 2012 Most Spanish biofuel producers have chosen to obtain certification from ISCC, 2BSvs and RBSA The mutual recognition between national systems-voluntary schemes and between voluntary schemes themselves is still very problematic 34

35 II.2. Double-counting (1) Even though the Royal Decree 1597/2011 transposes article 21(2) of the RED, it provides no details on the following essential aspects: Definitions wastes and residues The feedstocks eligible for double-counting The start date of double-counting Traceability mechanism of double-counting biofuels The Secretary of State for Energy will adopt a definition or/and a list of eligible feedstocks during the course of this year The CNE is responsible for defining an adequate traceability mechanism the Royal Decree mentions explicitly that the UCO producers are part of the chain of custody 35

36 II.2. Double-counting (2) List of eligible materials for double-counting purposes: It is difficult to elaborate objective criteria on the basis of which to differentiate between waste, residue and coproduct and to decide whether a certain feedstock is a residue or not Different lists for different purposes (GHG, land-use criteria, double-counting)? Lignocellulosic and cellulosic materials - not that controversial (yet) Wastes: UCO? (definition of UCO?) an agreement in more or less all countries which have implemented double-counting that this is an eligible feedstock More controversial materials: Animal fats (category 1, 2 or 3?) Oleins, PFAD, acid esters from glycerol treatment? Marcs and wine lees? 36

37 II.2. Double-counting (3) Limits of consumption of double-counting biofuels? The implementation of double-counting has caused significant reductions in the volumes of biofuels incorporated: E.g. The Netherlands: biofuels market share decreased from 3,5% in 2009 to 2% in 2010 (in energy terms). The largest part of the biofuel mandates were fulfilled by using UCOME Some countries have chosen to impose limits on the quantities of double-counting biofuels which could be incorporated into the market: France: 0,35% of diesel consumed in 2012 for UCOME and TME -> 5% of the 7% target (in energy terms); TME counts 1,5 times. To what extent is this in line with the RED? Is this the best solution to prevent the shrinking of the EU biofuels market (esp. biodiesel)? 37

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