EurObserv'ER logo

Biofuels in Spain

General
The whole spectrum of renewable energy policies is laid down in the Program for Promotion of Renewable Energies 2005-2010 (PPER or PFER in Spanish). Revised version of PFER 2000-2010, the strategic target of PFER is to achieve by 2010 a 12% of primary energy consumption by renewables (with, a.o., a 30.3% contribution of renewables to electricity consumption), through a joint combination of subsidies, tax exemptions and feed-in-tariffs for electricity production. The total investment for the realisation of the renewable energy plan (PPER) for the period 2005-2010 is estimated to 23,600 M€, from which 36% (8,490 M€) would be contributed by public support (feed-in tariff electricity: 4,960 M€, biofuels: 2,850 M€, subsidy direct to the projects: 680 M€).

According to the Directive 2009/28/EC of the European Parliament and of the Council on the promotion of the use of energy from renewable sources the target for the share of energy from renewable sources in gross final consumption of energy in the year 2020 for Spain is 20% (in the year 2005 the share was 8.7%). The Directive has a mandatory 10 % target for transport to be achieved by all Member States, which refers to renewable sources as a whole, not biofuels alone.

Renewable energy projections according to the National Renewable Energy Action Plan for Spain
The National Renewable Energy Action Plan (NREAP) for Spain was submitted in July 2010. The target according to Annex I of Directive 2009/28/EC is 20% for the year 2020 and the projected NREAP share in that year is 22.7%.  According to the projection, the most important contribution in the year 2020 is expected from wind power (78.3 TWh or 6729 ktoe, 31% of all renewable energy). Second important contribution is expected from biomass (renewable heating and cooling) (4950 ktoe, 22% of all renewable energy). The third largest contribution is from hydropower (39.6 TWh or 3404 ktoe, 15% of all renewable energy). Wind power contributes with 38.0 GW (78.3 TWh) in the year 2020 (onshore wind 35.0 GW and 70.5 TWh, offshore wind 3.0 GW and 7.8 TWh). For solar photovoltaic the 2020 contribution is projected to be 8.4 GW (14.3 TWh). For solar thermal the 2020 contribution is projected to be 644 ktoe. The two most important biofuels are projected to contribute 3100 ktoe (biodiesel) and 400 ktoe (bioethanol / bio-ETBE) by 2020. The renewable electricity production from solid biomass amounts to 7.4 TWh (636 ktoe) and for biogas it is expected to be 2.6 TWh (225 ktoe). The consumption of renewable heat is expected to amount to 4850 ktoe for solid biomass and 100 ktoe for biogas.

Renewable transport fuels (biofuel)
The Spanish support system is particularly favourable to the development of biofuels, with a total tax exemption planned on up to 31 December 2012. This total exemption could be called into question in the case where there were to be a decoupling between the production costs of biofuels and petroleum products. It is planned, however, that the tax on biofuels shall not be able to exceed the tax on petroleum products. On 15 June 2007, the Spanish Congress of Deputies approved a new regulation that imposes a mandatory incorporation of biofuel in fuels intended for transport beginning in 2009. This obligation shall represent 3.4% in 2009 and shall rise to 5.83% in 2010. 

According to the IDAE (Institute for diversification and energy saving), the country consumed approximately 644 ktoe of biofuels in 2008 (519 ktoe of biodiesel and 125 ktoe of bioethanol), representing an increase of 65.6% compared to 2007. Total consumption is equivalent to an incorporation rate in energy content for all transportation fuels of approximately 2% (1.2% in 2007), in keeping with the declarative target set by the country. The incorporation rate will become compulsory as of 2009 and will be set at 3.4% for all biofuels with a minimum incorporation rate of 2.5% both for bioethanol and for biodiesel. The difference can be made up by either of the two types of biofuels. The mandatory incorporation rate will then rise to 5.83% in 2010, with a minimum rate of 3.9% both for biodiesel and bioethanol. The Spanish incentive scheme is particularly favourable to the development of biofuels, with total exemption from the tax on hydrocarbons up to 31 December 2012.

The table below lists the main biofuel-related measures in Spain. The table has been taken from the ELOBIO project.

Support to biofuels

Royal Decree 61/2006

(31st January,  2006)

 

That modifies the

Royal Decree 1700/2003

Indicative

To reach 5.75% (minimum share of commercialization), on the base of energy content, in all the gasoline and diesel used for transportation. Deadline: 31st December, 2010

Plan for Renewable Energy 2005/2010 – IDAE

Indicative

To reach 5.83% (minimum share of commercialization), on the base of the energy content, in all the gasoline and diesel used for transportation. Deadline: 31st December, 2010. This means 2.2 million teps.

Bioethanol y biodiesel shares will reach 39% and 61% respectively.

Treasury

Law 22/2005

(18/11/2005)

 

That modifies the Special Taxes Law 38/1992

(28 /12/1992)

 

 

Compulsory

0% taxes (until 31st December, 2012) for bioethanol and biodiesel, only applied to the biofuel volume, not to the mix with other fuels.

It is applied as long as the comparison of the production cost evolution of oil products and biofuels recommends it.

 

Besides, art 51.3 of the Law exempts the tax to the production and import of biofuels to be used in pilot projects which target is the technological development of less pollutant products. 

Royal Decree 774/2006

(23/06/2006)

 

That modifies

Royal Decree 1165/1995

(7/07/1995)

Voluntary

Gives the chance to mix biofuels with fossil fuels in vehicles supply and final use installations.

Law 36/2003 of Economic Reforms

(11 /11/2003)

 

That modifies the

Law 43/1995 regarding Corporate tax

(27/12/1995)

Compulsory

10% of reduction in the corporate tax is allocated to investments on equipments and facilities to convert agricultural products into biofuels.

Sectoral regulation

Law 12/2007

(2/07/2007)

 

That modifies

Law  34/1998

(07/10/2007) for the hydrocarbon sector

 

(the objective is to adapt Law 12/2007 to the European Directive 2003/55/CE)

(26/06/2003)

 

Indicative and compulsory

 

Introduces the differentiation between biofuels and biomass and extends the list of products susceptible of being considered as biofuels

Sets annual objectives to biofuels and other renewable fuels commercialization for the period 2008-2010. Fixes indicative 1.9% by 2008, compulsory 3.4% by 2009 and compulsory 5.83% by 2010.

Entitles the Industry, Tourism and Trade Ministry to enact the necessary resolutions to regulate a mechanism of promotion of biofuels and other renewable fuels in order to meet the annual objectives.



Future programme changes expected
No information on future policy.

Sources
Biofuel Barometer, http://www.eurobserv-er.org, June 2008

Biofuel Barometer, http://www.eurobserv-er.org, July 2009

ELOBIO, Inventory of biofuel policy measures and their impact on the market, September 2008,  http://www.elobio.eu/publications

Directive 2009/28/EC of the European Parliament and of the Council of 23 April 2009 on the promotion of the use of energy from renewable sources and amending and subsequently repealing Directives 2001/77/EC and 2003/30/EC (Entry into force on June 25th, 2009), download from http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:32009L0028:EN:NOT

The National Renewable Energy Action Plans (NREAPs) are all published on the Transparency Platform on Renewable Energy: http://ec.europa.eu/energy/renewables/transparency_platform/action_plan_en.htm (sourced July - December 2010)

Renewable Energy Projections as Published in the National Renewable Energy Action Plans of the European Member States, http://www.ecn.nl/nreap (sourced December 2010)

Interactive EurObserv’ER Database
http://www.eurobserv-er.org
Last update: December 2010



This information can be referenced without permission provided that thesource is mentioned completely and correctly: 'Interactive EurObserv'ER Database, http://www.eurobserv-er.org (date of last update)'

Suggestions for improvements to the policy description can be sent to EurObserv'ER by e-mail: project@eurobserv-er.org

The EurObserv'ER barometer is a project supported by the European Commission within the DG ENER 'Intelligent Energy Europe' programme and by Ademe, the French Environment and Energy management Agency. The EurObserv'ER Barometer is the result of the investigation and research work of its authors. The European Commission is not responsible for any use that may be made of the information contained therein.