The European Investment Bank (EIB; Luxembourg; www.eib.org) and Cepsa (Madrid, Spain; www.cepsa.com) sign a €285 million loan agreement for the construction of an advanced biofuels plant to be located next to the La Rábida Energy Park in Palos de la Frontera, Andalusia.
The plant, which Cepsa is building together with Bio-Oils (bio-oils.com), will produce sustainable aviation fuel (SAF) and renewable diesel (HVO), from organic waste, such as used cooking oil, or from agricultural waste. Once operational, the facility is expected to process as much as 600,000 tons of waste and produce up to 500,000 tons of second-generation biofuels annually.
The biofuels will serve industries such as aviation, maritime transport and even heavy-duty road transport for which decarbonization and electrification pose challenges. Biofuels are an immediate solution to reduce CO2 emissions from this sector, without making changes to existing engines.
“This loan is a clear example of how the EIB promotes the energy transition also in hard to abate sectors. This project will contribute to make Spain one of the leading countries in the production of biofuels,” said Gilles Badot, director of EIB operations for Spain and Portugal. “Supporting private companies like Cepsa, which are investing in this transition and advancing their own decarbonization strategies, is one way the EIB is accelerating the transition to a more sustainable energy model that promotes EU energy autonomy.
The investment by Cepsa and Bio-Oils will be made entirely in Andalusia, a cohesion region where per-capita income is below the EU average. Given the project scope, it is expected to have a positive impact on the local economy by boosting growth and job creation.
This project supports the decarbonisation objectives of the European Green Deal. It is also part of the EIB’s action plan to support REPowerEU in ensuring energy security and reducing EU dependence on fossil-fuel imports.
The project is supported by InvestEU, an EU program to mobilize more than €372 billion of additional investment in the period 2021-2027. It furthers one of the programme’s main objectives: developing the energy sector and the sustainable bioeconomy.
With this new arrangement, the EIB is continuing to support Cepsa’s decarbonization strategy. It is the third financing operation with Cepsa in the last two years to accelerate this strategy. The previous two were a loan of €80 million for photovoltaic plants in Andalusia and a loan of €150 million for Cepsa’s network of electric charging stations in Spain and Portugal.
The ElB is the long-term lending institution of the European Union, owned by the member states. It finances sound investments that further EU policy objectives. EIB projects bolster competitiveness, drive innovation, promote sustainable development, enhance social and territorial cohesion, and support a just and swift transition to climate neutrality.
The EIB Group, consisting of the EIB and the European Investment Fund (EIF), reported total financing signatures in Spain of €11.4 billion in 2023, approximately €6.8 billion of which went to climate action and environmental sustainability projects. Globally, the EIB Group signed €88 billion of new financing in 2023.
Cepsa is embarking upon an in-depth transformation of its activities via its Positive Motion 2030 strategy, with the goal of going zero-carbon and helping its customers to overcome their own decarbonisation challenges. To this end, the company is set to invest €8 billion this decade, around 60% of which will go to sustainable businesses linked to electric mobility and the production of green molecules – mainly green hydrogen and biofuels.