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Bioenergy and Climate Protection Programme of the Federal Government

Clemens Neumann, BMELV

12. November 2008

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Main reasons behind political action towards bioenergy

• Environmental/climate protection• Security of energy supply

– Total share of energy imports in Germany 70%– Import share oil almost 100%

• Additional income for farmers and foresters

• Employment in rural regions• Technological development

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Energy- and Climate-Programme

• Förderung der Kraft-Wärmekopplung und Ausbau des Nah- und Fernwärmenetzes

• Better integration of renewables in the electricity-net• Promoting programs • Feed-in regulations für biogas in NG-net• Renewable-Energy-Heat-Regulation• Strengthening R&D aiming better climate protection and

energy-efficiency (part of high-tec strategy)• Realisation of international projects, close political dialogue

and cooperation in R&D

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European Council March 2007

• CO2 – reduction (binding): 20 % by 2020

if other industrialised countries take part: 30 % by 2020

• Share in renewable energies

of total energy consumption: 20 % by 2020

• Share of renewables in transport 10 % by 2020

European Objectives

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Quelle: BMELV, BLE, FNR

Cultivation area of bioenery

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Kraftstoffe

Renewable Energy in Germany in 2007

Heat in 2007

93,3%

4,1% 2,6%

Biomass

Solar energy

Geothermic energy

Share in renewable energy of primary consumption of total energy: 8,6 % Share provided by biomass: 5,9 %

Electricity in 2007

Wind power45,2 %

Hydro power23,6 %

Bioenergy

incl. Biogas27,2 %

Solar-energy

4 %

Biofuels: 100 % (no other renewable source available)

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Current Situation

Source: AGEE-Stat

Share of Bioenergy in Renewables Use 2007

8.6% of energy is covered by renewables, of which 69% is biomass

Photovoltaics1,6%

Hydropower9,2%

Biofuels20,8%

Biomass Electricity

10,6%

Biomass Heat37,6%

Wind Energy17,6%

Solar Heat1,7%

Geothermal1,0%

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Biofuels in Germany

Quelle: BAFA/FNR (Werte 2007: Schätzung)

196

1.080840

226478 460

1.800

2.500

3.320

2.222

4.058

4.620

0

500

1.000

1.500

2.000

2.500

3.000

3.500

4.000

4.500

5.000

Vegetable Oil Ethanol Biodiesel total biofuels

2005 2006 2007

[in 1000 T]

Share of biofuels (energetic): 2005: 3,6 % 2006: 6,3 % 2007: 7,3 %

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Fuel standards

Blendings in Germany It is allowed to blend fossil fuels with up

to 7 % (vol.) biodiesel or 5% bioethanol

Progress on E10 is stopped, because of risks of damage

for more than 3 mio. cars.

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Biofuels Quotas Act / Energy Taxation Act

Biofuels Quotas Act (December 2006)

Intention: Increasing share of biofuels to > 6,25% by 2015 (relating to energy content)

• Fuel selling enterprises are obligated to sell a minimum quota of biofuels

• Biofuels are fully taxed within the quota• Pure biofuels enjoy tax privileges until 2012• E85 and the 2nd generation of biofuels enjoy tax exemption until 2015

(pure as well as in blendings)• Pure biofuels used in agriculture remain tax-exempt

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Framework Conditions for Biofuels Germany

• Biofuel Quota Act (Jan 2007)– Introduction of biofuel

quotas for:• Producers and traders of

Diesel fuel and gasoline• Producers of biofuels

(biodiesel, vegetable oils)

– Quotas related to energy content

Year Total quota Diesel quota Petrol quota

2007 - 4,40 1,20

2008 - 2,00

2009 5,25 2,80

2010 6,25 3,60

2011 6,25

2012 6,25

2013 6,25

2014 6,25

2015 6,25

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Energy Taxation Act (August 2006)

Until July 2006:• Compensation of cost disadvantages of biofuel production plus

small incentive

Since August 2006:• Avoiding overcompensation of fiscal support• Gradual increase of taxes for biodiesel and vegetable oil fuel• Adjustment of fiscal support of biofuels due to changes in

cost structures

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Framework Conditions for Biofuels Germany

• Energy Tax Act (Aug 2006)– Since Aug 2006 taxation of

pure biofuels

– Tax exempted:• 2nd generation until 2015• Biofuels used in agriculture

and forestry

Year Tax rate biodiesel

(Cents/l)

Tax rate vegetable oil

(Cents/l)

2006 9 0

2007 9 2,15

2008 15 10

2009 18 18

2010 24 26

2011 30 33

From 2012

45 45

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Market Incentives Programme

Promotion of heat generation using renewable energy sources.

• Investment grants .• KfW programme .• From 2009 up to 500 mln. € p. a.• Apart from basic subsidies, an innovation bonus provides

for higher subsidisation of things like additional emission reductions and improved efficiency, large solar collector systems, process heat and the use of biomass in schools and churches.

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ELECTRICITY: Renewable Energies Act (EEG)

• July 2004; effective instrument in electricity generation from RenEn

• Applies to: wind, solar, biomass, geothermic energy• Guarantee of feed-in of produced electricity from renewable

energies• Feed-in tariff depends on plant-capacity/size, used technology and

thermal utilization• The Renewable Energy Sources Act (EEG) was amended in 2008

based on the results of an evaluation report (2007)• Guaranteed payments will range from 3,5 (huge hydropower) to

43,01 ct/kWhe (small solar on buildings).• An extra bonus is guaranteed for renewable raw materials (2,5-11

ct/kWhel) (biomass grown exclusively for energy use; use of residual and secondary products is allowable but is not subsidised) or combined-heat and power generation

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Sustainable biomass production

EU/Germany: Imports of biomass are increasing.

increasing critics in media and public:• Biomass production under doubtful conditions• Biomass production in connection with clearing tropical rainforests

Objective: Setting up a certification system for biomass production which is valid around the world.

German government is working together with European partners and producer countries and encourages discussion on the international level (FAO/ Global Bioenergy Partnership).

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National measures to ensure sustainable biomass production

Biofuels Quota Act

The Biofuels Quota Act includes the possibility to add sustainabilityregulations as precondition for later promotion

Biofuels have to meet certain criteria • Requirements of a sustainable land-use of agricultural area and • Requirements of protection of natural habitats and • Special potential of Green House Gas reduction (30 % to 40 %)

Sustainable production will be necessary to obtain support (tax and quota)

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Discussion: Biofuels vs. FoodThesis: „Increasing food prices caused by demand for biofuels“

Fact is: Biofuels only have little influence

Main reasons for increasing food prices in the past are:• Global increasing demand for food and feed• Change in consumption habits (more meat in developing

countries)• Bad harvests caused by weather• Low stock levels• Effects caused by venturers

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Research and Development (BMELV)

Actual focus points:

• BtL (Research and Development)

• Biomass combustion: Reduction of dust emissions

• Innovative utilisation of biogas

• Biogas production: Process optimisation in fields of microbiology and process control

=> Agency for Renewable Resources (FNR)

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So finally the aim of our policy is to avoid the following:

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Thank you for your attention!