EU Biofuels Barometer: Germany & France in the Lead

According to the 2006 statistics published in issue N° 179 of Systèmes Solaires-Le Journal des Énergies Renouvelables, biodiesel represented 71.6% of the energy content of biofuels devoted to transport last year, far ahead of bioethanol (16.3%) and the other biofuels (12.1%). This percentage is attributed to the explosion of vegetable oil consumption in Germany, which considers this product as a fully-fledged fuel.

Germany itself remained the largest European biofuel consumer last year, with a consumption estimate of 2.8 million tons of biodiesel (equivalent to 2,408,000 toe), 0.71 million ton of vegetable oil (628.492 toe) and 0.48 million ton of bioethanol (307,200 toe).

France was the second largest biofuel consumer among the 25-member EU States in 2006. According to the Ministry of Industry, France's consumption increased by 62.7% to reach 682,000 toe (i.e. 1.6% of French fuel consumption). Biodiesel represents the largest share of this (78%, far ahead of bioethanol with 22%).

Biodiesel & Bioethanol: The Major Players
While the principal biodiesel players are Germany and France, the unquestionable leader is the French Diester Industrie. The firm has numerous production sites in France: those of Grand-Couronne and Compiègne, to which the sites of Sète, Mériot and Montoir/Saint-Nazaire have been added this year.

The company also plans to inaugurate three new sites next year, those of Grand-Couronne 2, Capelle-la-Grande and Bordeaux/Bassens, with each having a 250,000 ton production capacity. The company expects to have a total production capacity of approximately 2 million tons at the end of 2008, up from approximately 710,000 tons in 2006. The group's total investments should exceed €2 billion.

Germany also continues to be a major player in the European biofuel industry thanks to the presence of several large companies. The biggest of these is ADM Oelmühle Hamburg AG, which is a subsidiary of the American group Archer Daniels Midland Company. The firm's current strategy is that of increasing its production capacities with the 2006 commissioning of a new 275,000 ton production unit in Mainz and the 150,000 ton extension of its plant in Hamburg in 2007.

Among the other large German producers, MUW (Mitteldeutsche Umesterungswerke GmbH & Co KG) and EOP Biodiesel AG can also be cited.

The European bioethanol fuel industry on the other hand is somewhat mixed with that of the production of alcohol and sugar, and its multiple market outlets (food industry, industrial processes, etc.). The Spanish group Abengoa, via its American subsidiary Abengoa Bioenergy, is the European leader in production of bioethanol. It operates three production units in Spain with a total production capacity of 526 million litres.

The group is presently building a fourth production unit in France in the Lacq petrochemical complex in the Pyrénées-Atlantiques department.

Another major contender in terms of bioethanol production is the German sugar corporation, Südzucker. Over the past few years, the company has invested heavily in Germany as well as in other European countries where it owns or controls numerous sugar companies.

The French agro-industrial group Téréos is also increasing its production capacities. Last September, this French company inaugurated a new beet distillation plant in Origny-Sainte-Benoîte (in the Aisne department), with a 300 million litre ethanol production capacity. Total investment amounted to €190 million.

Meeting the European Target
In spite of the presence of biofuel promotion mechanisms in most EU member States, it must be recognized that a significant number of countries shall not reach the threshold as set by the directive—5.75% biofuel share of total consumption in 2010.

At the beginning of the year, the European Commission drafted a report on the progress made with respect to the directive on biofuels. According to this report, the Commission estimates that the incorporation rate should be more likely in the region of 4.2%. This possible setback should not be of consequence on the future development of the sector.

During the European Summit Meeting held March 8th and 9th, the European Council approved the principle of a restrictive obligation (on the contrary to the present directive) of the biofuels incorporation rate at 10% of total gasoline and diesel oil consumption by the year 2020.

This decision should be confirmed by the European Council and the European Parliament by way of adoption of a European Commission directive.