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Biofuel Component in Eu Vehicle Fuel by 2020

Essay by   •  May 13, 2011  •  Essay  •  2,281 Words (10 Pages)  •  1,931 Views

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1. Situation 2010

The German government released induced by the directive 2009/28/EC of the European parliament on the promotion of the use of energy from renewable sources some new directives in the field of biofuel. The law of the European community to rise the biofuel component until 2020 up to 10% in the vehicle fuel and the new directive 2009/30/EC upon sustainable biofuel production were the reasons for a new legislation process in Germany. But there were several movements in the country before. The german gasoline consume in the traffic sector depends today with 95% on fossil fuels. The government announces in it s "Fuel - working paper", that faced by a political and economical insecure situation on the world oil market and primarily out of nature respect, it wants to reduce the consume of fossil fuels. To achieve that goal it is important to develop alternative fuels and less energy expending engines. Biofuels are one part in this strategy to reduce green house gas emissions and to contribute in the supply security through a fuel variation.

2. First Directives in 2003

According to the directive 2003/30/EG every country had to implement a structure to set it for granted that the targets in the directive will be reached. Since the first of January 2004 there are all Biofuel and Bioheat generating products treated by a reduced tax system (§ 2a Mineralölsteuergesetz). The reduce is for pure and for mixed products (fossil fuel + biofuel) and last until 2009. In the first years all the biofuel and heat products hat a zero percent tax shelter, to compete on the market with fossil diesel with a tax at 47,04 cent/liter and unleaded gasoline with a tax of 65,45 cent/liter. The main target of that tax sanction is it to balance the cost difference between fossil and bio fuel. The biofuel market has developed in the last years from a side issue to a central topic in politics and economics. Germany has conquered a leading position especially in the production and the use of biodiesel. We have to distinguish two main products the biodiesel as well as plant - oil fuel, as a alternative for the diesel market and the bioethanol to replace unleaded gasoline. The rise of the German strength on the market was only because of that long lasting tax shelter. The production capacity in Germany grew very dynamic from the first steps of the industry 1990 up to now, the industry can offer 3,5 million tons per year of biodiesel what means around 11% oft the consumption over one year. This amount of possible production capacity is not exploited yet, published by the support union of oil and protein plants.

Table 1 shows the annual consumption numbers of biofuels in Germany. It can be seen a steady rise after implementing the new law on fuel (Mineralölsteuergesetz) for the time from 2004 until 2009. Besides that also the market for bioethanol and plant oil developed but different in the shape of biodiesel, because of a lack in technology knowledge and less research effort in that fields (Bundesdrucksache 15/5816).

In 2003 through to the directive 2003/30/EG, beside the pure biofuel shelter a quota that allowed to mix 5% of biodiesel with the special tax - systems into the standard diesel was implemented (Dieselnorm DIN EN590). The aim out of this directive was to achieve in 2010 a 5,75% part of the fuel market. In 2005, 2% of the fuel should be produced out of renewable sources. The average in the EU was 2005 1,0%. Germany filled 2,0% biofuel of the overall amount in the cars and lorries.

Table 1: BMU-KI III 1 nach Arbeitsgruppe Erneuerbare Energien- Statistik (AGEE-Stat)

3. Adaptation of the law

In this time the discussion about a overcompensation on the German market was all around, the justification of the tax shelter in this extend was challenged. The argumentation to shelter a young industry which convinced in the first years all critics eroded. Mainly caused by the Bundesdrucksache 15 / 5816 2006 the government reformed the market with the adoption of two new laws, the energy tax law (EnergieStG) and the biofuel quota law (BioKraftQuG). The basic discussion was around the topic overcompensation. To prevent this in the § 2a Abs. 3 MinöStG there is a section about a reporting duty to the german government. How the market and the prices of biofuel and bioheat products are developing. The report has to be done by the finance and agricultural ministry first time to en hand was the 31 march 2005. In that time when pure biodiesel was disposed the production price was around 0,05 Euro/Liter lower than fossil fuel what equals 11% of tax on the fossil diesel, in mixed diesel products the biodiesel amount had a advantage of 0,10 Euro/Liter wich means 21% of the tax rate of fossil diesel. This zero tax promotion lead to a shortfall for the government budget in 2004 of 559 million Euro. Out of this results at the 1.August 2006 the EnergieStG implemented a successive rise of the tax on pure biodiesel.

To equalize the market possibilities of the competing products. Beginning with 9 cent per liter in 2006 and 2007 a yearly rise of 6 cent was en written in the law up to the tax rate of fossil diesel tax at 47,04 cent. This decision to change the tax system to a stepwise treatment of biodiesel as fossil fuel. Had deep impacts on the market the biodiesel gas station system declined. 2007 it was possible to fill in biodiesel in your car at 1900 different stations all over the country in the end of 2008 there were 250 left according to a AGQM-Arbetisgemeinschaft Qualtitätsmanagement Biodiesel e.V survey. The used biofuel in the agricultural sector for plowing or drilling safed the special zero percent tax shelter, which should promote the small industry in the rural areas and the outcome of the farmers. Bioethanol (E85 gasoline) as a exchange for fossil unleaded gasoline which has a tax rate of 65,45 cent per liter is still sheltered on the zero tax level. E 85 as well as products out of cellulose like biomass to liquid fuel is counted as especially eligibility, because of the securing young technology factor.

4. Second adaptation of the law

In 2009 the german government approved again the compensation of the competing products biofuel vs. fossil fuel, the Bundesducksache 16/13900 stated that there is no market distortion out of the special tax regulations for biofuels. To ensure the demand for the produced Biodiesel and secure the industry an admixing quota to fossil diesel was established. The BioKraftQuG from 18.12. 2006 obligates the mineral oil economy to bring a minimum portion of biofuels into traffic. This rises starting

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