Biodiesel in Serbia drying up from levies

Serbian drivers of diesel vehicles should already be pouring a share of 10% of biodiesel into tanks, as stipulated in obligations in the process of accession to the European Union. The deadline for implementation is 2020, while petrol stations still don’t have any biofuel in offer, as the government directive on mixing it with diesel is two years overdue, Novosti.rs reported. Meanwhile, the article says, biodiesel producers have gone bust because the state introduced a burdensome excise in 2013.

The levy made all firms which manufactured biodiesel from unregulated soybeans and waste oil to switch. The factories fired half of the workforce and the machines now only have cattle feed and heating briquettes in output. Production has no purpose anymore, as biodiesel is more expensive than regular fuel, says Srećko Radovanović, who sells equipment for biofuel under the brand Bio-dizel Solutions. “The excise rose to RSD 52 (EUR 0.42), so no one buys machines except for own use. So the waste is discarded instead of being utilized. Slaughterhouse waste is a typical example, as it could be used to manufacture biological heating oil,” he told the portal.

The excise was rolled out because biodiesel had been illegally mixed into fuel as cheaper than euro diesel, so the state lost profit. Back in 2013, there was an announcement a framework is in the pipeline to oblige oil companies to mix in ecological fuel under government control.

The Law on Energy enabled the introduction of biodiesel to the market, says Tomislav Mićović, secretary general of the Association of Oil Companies of Serbia, and adds it would take a year for the market to prepare if a directive is issued for a high cut of 10% of biodiesel. He stressed the abolishment of the levy would prevent a rise in price of the mix and that other countries, like Croatia, stimulate the use of biodiesel. According to the article, there were cases of smuggling of biodiesel as soybean oil in tanks, where customs intercepted several contingents.

In November 2014, Energo-Zelena d. o. o. and its parent company Zelena N. V. of Belgium introduced arbitration against Serbia at the International Center for Settlement of Investment Disputes (ICSID) in Washington DC, United States. The rendering plant for treatment of hazardous animal by-products, which previously ceased its operations, cited the government failed to enforce its own legislation concerning the treatment of animal by-products, thus jeopardizing the viability of the company. The facility is designed to process material no longer allowed to be consumed either by humans or by animals. The final products, after treatment, are meat and bone meal and tallow, used as fuel and for biodiesel production, respectively.