The Government of Spain published a Ministerial Order to establish a biodiesel production quota system.
THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY
USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT
GAIN Report Number: SP1213
Spain Enacts Biodiesel Production Quota System
Oilseeds and Products
Shortly after Argentina announced the expropriation of 51% of YPF, a subsidiary of Repsol,
Spain's largest petroleum company, the Government of Spain published a Ministerial Order to
establish a biodiesel production quota system. This Ministerial Order lays down the rules to
allocate biodiesel production quotas to EU based biodiesel producers whose production
would be eligible to meet consumption mandates. The implementation of this quota system
would ultimately restrict third country exports of biodiesel to Spain and result in increased
domestic production of biodiesel and a higher demand of raw materials versus finished
Shortly after Argentina announced the expropriation of 51% of YPF, a subsidiary of Repsol, Spain's
largest petroleum company, the Government of Spain published a Ministerial Order to establish a
biodiesel production quota system. This Ministerial Order lays down the rules to allocate biodiesel
production quotas to EU based biodiesel producers whose production would be eligible to meet
consumption mandates. The implementation of this quota system would ultimately restrict third
countries’ exports of biodiesel to Spain and result in increased domestic production of biodiesel and a
higher demand of raw materials versus finished product imports.
Abbreviations used in this report:
EBB: European Biodiesel Board.
APPA: Spain’s Renewable Energies Association
CNE: Spanish National Energy Commission
CORES: Spanish Corporation of Strategic Reserves of Oil-based Products
IDAE: Spanish Institute for Energy Diversification and Saving
EU: European Union
MS: Member State
HS: Harmonized System of tariff codes
MT: Metric tones
N/A: Not Available
Energy content and conversion rates:
Biodiesel = 37.50 MJ/kg
1 Toe = 41.87 GJ
1 MT Diesel = 1,195 Liters = 1.02 Toe
1 MT Biodiesel = 1,136 Liters = 0.90 Toe
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Spain is one of largest consumers of biodiesel within the EU. Biodiesel consumption (Table 2) in Spain
follows an upward trend mainly driven by the blending requirements (Table 1) imposed since 2009.
Table 1. Spain’s Biodiesel specific and overall mandates (percentage in terms of energy)
Year 2009 2010 2011 2012 2013
Biodiesel specific mandate (%) 2.5 3.9 6 7 7
Overall biofuels mandate (%) 3.4 5.83 6.2 6.5 6.5
Source: Orden ICT/2877/2008. Royal Decree 1738/2010 and Royal Decree 459/2011.
Table 2. Spain’s Biodiesel Consumption
Year 2008 2009 2010 2011
Biodiesel (1,000 MT) 588 1,028 1,362 1,520
Source: FAS Madrid based on CORES data.
While installed biodiesel production capacity (Table 3) in Spain almost triples mandatory consumption,
capacity use has been really low over the last years - close to 14 percent in 2011 according to industry
sources - due to stiff competition from third countries’ exports of biodiesel.
Table 3. Spain’s Biodiesel Production Capacity
Year 2005 2006 2007 2008 2009 2010 2011
Production Capacity (1,000 MT) 100 248 815 2,070 4,100 4,300 4,400
Sources: EBB, APPA and FAS Madrid estimates.
In 2011, biodiesel imports from Argentina and Indonesia represented nearly 60 and 25 percent of
imports (Table 4). Total imports covered over 70 percent of domestic biodiesel consumption.
Table 4. Spain’s main Biodiesel Suppliers (1,000 MT)
Year 2008 2009 2010 2011
EU-27 192 341 180 168
Argentina 0 197 436 695
Indonesia 73 36 187 325
India 0 9 12 15
Malaysia 6 20 21 5
United States 98 4 0 0
Others 1 2 1 2
Total 370 610 838 1,211
Source: Global Trade Atlas (GTA) data. HS code 3824 90 91.
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The former Ministry of Industry, Tourism and Trade drafted a Ministerial order in 2010 regarding the
allocation of production quota of biodiesel. This Ministerial Order, which was assessed by the National
Energy Commission (CNE), remained on hold until Friday April 20, 2012, reportedly, due to pressure
from exporting countries.
On Friday, April 20, 2012 the Council of Ministers agreed on implementing a system to establish a
quota system by which only EU producers could apply to be granted by production quotas. Only
production under quotas would be eligible to meet the consumption mandates. Spain’s Official Gazette
published Ministerial Order IET 822/2012 on Saturday April 21, 2011 laying down the rules for the
biodiesel production quota that would ultimately reduce imports of biodiesel originated in third
countries. This measure came shortly after Argentina announced on Monday April 16, 2012 the
nationalization 51% of YPF, a subsidiary of Repsol, the Spain's largest petroleum company.
Biodiesel Quotas Ministerial Order
The Ministerial Order IET/822/2012 by the Ministry of Industry, Energy and Tourism intends to
promote the domestic transport biodiesel industry as well as to contribute to the security of energy
supply and to reduce dependence on petrol imports.
EU Biodiesel companies are invited to present their requests for production quota within a 30 day
period. A total of 5 million metric tons of biodiesel will be distributed among producers, from which, at
least 4 million MT of biodiesel should be requested by biodiesel companies to ensure fair competition.
If the total amount requested is below 4 million MT, the submission deadline will be postponed. If less
than 2 million MT are requested, the quota allocation procedure will be cancelled.
Companies can request production quota to the limit of their authorized production capacity.
Production quota requests will be accompanied by additional company information. Plants that already
have quota allocated by other EU schemes will not be eligible.
Based on information provided by companies, competent authorities will decide on the quota allocation
for a two year period considering environmental, security of supply, production capacity and economic
and financial viability criteria. The period can be extended in two additional years if deemed
The final allocation of biodiesel production quotas will be published in the Official Gazette within a 6
month period. From then on, only production under quota will be eligible to count against the
consumption mandates. Therefore, only production under quota will be granted with the exemption to
pay the 350 Euros fines imposed per certificate/metric ton of oil equivalent that the obliged parties
failed to market. If a company is granted with biodiesel production quota it cannot transfer it to another
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Once the quantities are allocated to biodiesel plants, in addition to the information required to obtain the
biofue [i]l use certificates , the obliged parties will need to provide the CNE with evidence that shows that
the biodiesel they are marketing has been produced in plants with quota and within their annually
allocated quota. From January 2013 information on verification of sustainability will also be required.
Impact on biodiesel production, raw materials use and trade
The enforcement of this Ministerial Order will likely result in increased domestic production – in Spain
and possibly in other EU MS – as well as in increased imports of raw materials that would replace
finished product imports.
In 2011, data available show that domestic consumption of biodiesel reached 1.5 million MT, about 30
percent of the capacity installed. The quota allocation will ensure that domestic consumption is
supplied by EU based plants, however, full capacity use of Spain’s based plants is not assured, unless
biodiesel exports grow, as other MS plants can participate in the quota system and due to the fact that
there is an surplus of production capacity installed compared to projected consumption in Spain [ii] .
Latest official information released on feedstock used corresponds to year 2010 (Table 5), when
according to the CNE’s annual report, 36 percent of the domestic biodiesel was produced out of soybean
oil and 42 percent out of palm oil. Animal fats and recycled oils represented about 18 percent of the
feedstock used. The remaining 4 percent was produced out of rapeseed and sunflower oil.
Table 5. Raw materials used in Biodiesel produced in Spain
Year 2009 2010 2011
Soybean oil (%) 43 36 N/A
Palm oil (%) 38 42 N/A
Recycled oils and Animal Fats (%) 12 18 N/A
Sunflower and Rapeseed oil (%) 7 4 N/A
A number of factors will come into play when determining domestic industry’s preferences on biodiesel
raw materials. For 2012 no significant changes are anticipated in the use of raw materials since the
Ministerial Order will be not effective earlier than the third quarter of the year.
Palm oil and soybean oil imports declined in 2011 for the first time in the last 5-years period by 10 and
40 percent respectively (Table 6 and Table 7), a rebound in these oils imports is anticipated for 2012,
particularly in the second half of the year.
In 2013, a transition period for sustainability verification will have expired, and raw materials will have
to be sustainable to be eligible to meet consumption mandates. Also, depending on how the double
counting for recycled oils and animal fats use as raw materials is tackled, it could spark biodiesel
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industry’s interest in waste-derived feedstock. Nevertheless, while there has been a growing interest
over the years in this type of products, not all biodiesel plants in Spain can operate on waste-derived raw
Total soybean crushing in Spain capacity is over 3 million MT and it is expected to remain stable.
While no increase is anticipated in soybean imports due to the limited crushing capacity, the
implementation of this Ministerial Order could create more marketing opportunities for crude oils,
soybean and palm oil as well as recycled vegetal oils and animal fats.
Table 6. Spain’s Imports of Palm Oil (1,000 MT)
Country of Origin 2007 2008 2009 2010 2011
EU-27 13 12 27 46 51
Indonesia 113 136 388 448 333
Malaysia 29 77 41 48 94
Papua New Guinea 83 127 143 102 78
Others 80 37 44 19 34
Total 318 388 643 664 589
Source: Global Trade Atlas (GTA) data. HS code 1511.
Table 7. Spain’s Imports Soybean Oil (1,000 MT)
Country of Origin 2007 2008 2009 2010 2011
EU-27 16 14 16 25 14
Argentina 14 21 55 100 48
Brazil 11 56 63 21 20
Paraguay 0 0 4 6 5
Norway 0 0 0 9 9
Others 1 1 3 2 0
Total 42 92 141 163 96
Source: Global Trade Atlas (GTA) data. HS code 1507.
According to the Renewable Energy Plan by IDAE, domestic production of vegetable oil (some via
oilseed imports) in 2020 would total 835,000 MT, which virtually meets food requirements. The
biodiesel anticipated oil demand in 2020 will amount to 2,245,000 MT, which would likely be met by
imports of oils.
Report Title Date Released
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Oilseeds and Products Annual EU-27 4/5/2012
Spain Biodiesel Standing Report 11/22/2011
EU-27 Biofuels Annual 6/29/2011
[i] Note: Spain implemented a Certification System (SICBIOS), managed by the CNE (National Energy
Commission) through which parties obliged to supply biofuels must send their requests for certificates.
One certificate equals one metric ton of oil equivalent of biofuel marketed. At the end of each year, the
CNE calculates whether the obliged parties met the mandates. Fines of 350 Euros are imposed per
certificate/metric tons of oil equivalent that the obliged party failed to market.
[ii] The Spanish Renewable Energy Plan anticipated that biodiesel consumption in 2020 would amount
to 2.6 million MT, which corresponds to nearly 60 percent of the production capacity installed.
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