|Year:||2011 (Apr 21st)|
|Policy status:||In Force|
|Date Effective:||2011 (Apr 21st)|
2014 (Jul 14th); Law 21 of 2013
|Policy Type:||Regulatory Instruments, Economic Instruments, Economic Instruments>Market-based instruments, Economic Instruments>Fiscal/financial incentives, Economic Instruments>Fiscal/financial incentives>Tax relief|
|Policy Target:||Bioenergy, Bioenergy>Biofuels for transport, Bioenergy>Biomass for power|
|Policy Sector:||Electricity, Transport|
|Legal References:||Law 42|
The 2011 Biofuels Law (Law 42 of 2011) regulated by Decree 345 of 2013, defined national policy guidelines for biofuels. It established a blending mandate for 10% bioethanol by 2016, that gradually would increase from 2% in 2013, to 5% in 2014, and 7% in 2015. It also allows the use and blending of biogas and biodiesel, stipulating that a biodiesel mandate will require previous measures and coordination with biofuel producers.
The Law also established subsidies of 20% of feedstock costs during the first five years for the operations of biofuel plants that process local biomass.
In addition, the Biofuels Law provides fiscal incentives for biofuels, including: 10 year exemptions from import taxes on equipment and supplies; transfer tax; income tax on sales; and income tax on carbon credits. Likewise, it also exempts biomass projects from licensing fees at the national and local level for 10 years.
The Biofuels Law provides exemption of transmission and distribution fees for electricity generated from biomass when sold through direct contracts for up to ten years after beginning of operation.
Law 42 also states tge priority for biomass projects in electricity auctions.
Law 21 of 2013 postponed de blending mandate from Law 42 requirements by one year. Due to lack of supply, a new Resolution 2188 of 2014, authorized the sale of unblended gasoline.
Resolution 2283 of 2014, noting the lack of supply due to judicial action on environmental impacts associated to bioethanol production, suspended the scheduled increase of the blending mandate to 7% and provided that, should supply be restored, Resolution 2188 of 2014 could be derogated thereby maintaining the 5% blending mandate.
The ammendment to the law in 2014 sets the consumer’s tax for bioethanol and biodiesel at USD 0.159/liter and USD 0.066/liter respectively, and it provides a fiscal credit of USD 0.159/liter for the purchase of biofuels which can only be deducted from consumer’s tax on fossil fuels.
Last modified: Tue, 02 May 2017 16:45:16 CEST