Spain consumed 1.16 million mt of biofuels in 2014, a rise of 6.6% compared with the prior year but far short of the record 2.46 million mt used in 2012, according to data released this week by CORES, the Spanish oil statistical agency.
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Demand was boosted compared with the previous year by an upturn in road fuel demand, as well as by a desire to store sustainability certificates ahead of a possible transition to the Renewable Energy Directive for biofuels this year, market sources said.
The largest gain was seen in biodiesel, which saw 885,517 mt consumed over the year, a 7.4% rise.
This was helped by a 2% gain in diesel consumption to 20.932 million mt, although the incorporation rate of biodiesel also rose by 0.21 percentage point to 4.23%.
For the year 274,510 mt of ethanol was used, a 4% increase, compared with a 0.8% fall in gasoline usage to 4.617 million mt.
The blending rate of ethanol into gasoline moved .28 percentage point higher to 5.95%.
Overall road fuel consumption was higher in 2014 as the economy started to recover, which led to a growth in biofuel usage based on renewables mandates.
Alongside this, ethanol was priced competitively versus other gasoline components for much of the year in Europe, increasing demand.
One source said the main cause for the growth in consumption of biofuels was a hoarding of sustainability certificates to carry over to 2015, due to a chance that Spain would finally implement the EU's Renewable Energy Directive for biofuels and the price of compliance would then increase.
"I think that a lot of people took certificates to carry over for this year .. . a lot of people thought that sustainability [legislation] would be a reality," the source said.
Spain is yet to implement the RED for biofuels, which has more stringent certification audit requirements that set out minimum greenhouse gas savings in biofuels and stipulate protection of lands with high biodiversity or high carbon stock.
It is the only member state which has not applied the legislation for biofuels, after Poland made the transition starting 2015.
Instead, Spain is able to meet renewable energy obligations with solar- and wind-powered electricity generation, among other things, leaving the government in no rush to push through legislation that would increase fuel prices at the pump and hamper economic growth, the source said.
The Fuel Quality Directive, a separate EU law which targets a saving of 6% of greenhouse gases in road fuels by 2020, still looms large, though, and once Spain begins to consider that requirement more seriously the certification of its biofuels should start to fall into line with other member states.
Germany has led the way with targeting biofuels with higher GHG savings.
As of January it now has a mandate that requires a set amount of GHG savings in road fuels from biofuels rather than for a certain amount of energy to be provided by biofuels, as in most other countries.
--Sean Bartlett, firstname.lastname@example.org
--Edited by Jason Lindquist, email@example.com