EIB and Cepsa Secure €285 Million Loan for Advanced Biofuels Plant in Andalusia

The investment by Cepsa and Bio-Oils will be entirely in Andalusia, a region with below-average per-capita income in the EU.

The European Investment Bank (EIB) has signed a €285 million loan agreement with Cepsa to construct an advanced biofuels plant adjacent to the La Rábida Energy Park in Palos de la Frontera, Andalusia.

Cepsa, in collaboration with Bio-Oils, will use the facility to produce sustainable aviation fuel (SAF) and renewable diesel (HVO) from organic waste such as used cooking oil and agricultural waste, promoting the circular economy. The plant is expected to process up to 600,000 tonnes of waste and produce up to 500,000 tonnes of second-generation biofuels annually.

These biofuels will be crucial for industries like aviation, maritime transport, and heavy-duty road transport, where decarbonisation and electrification are challenging. Biofuels provide an immediate solution to reduce CO2 emissions without needing engine modifications.

"This loan is a clear example of how the EIB promotes the energy transition in hard-to-abate sectors. This project will help position Spain as a leader in biofuels production," said Gilles Badot, director of EIB operations for Spain and Portugal. "Supporting private companies like Cepsa in their decarbonisation efforts accelerates the transition to a sustainable energy model and enhances EU energy autonomy."

The investment by Cepsa and Bio-Oils will be entirely in Andalusia, a region with below-average per-capita income in the EU. The project is expected to positively impact the local economy by boosting growth and job creation, contributing significantly to the EIB's commitment to economic, social, and territorial cohesion.

"We are grateful for the EIB's support for this key project, which aligns with our Positive Motion strategy and advances Spain's and Europe's energy independence goals. This plant will significantly enhance green molecule production, facilitating the immediate decarbonisation of land, sea, and air transport by reducing CO2 emissions by up to 90% compared to traditional fuels," said Maarten Wetselaar, Cepsa's CEO.

This initiative supports the European Green Deal's decarbonisation goals and is part of the EIB’s action plan to support REPowerEU, ensuring energy security and reducing EU dependence on fossil fuel imports. The project is backed by InvestEU, an EU programme aiming to mobilise over €372 billion in additional investment between 2021 and 2027, with a focus on developing the energy sector and the sustainable bioeconomy.

This latest agreement continues the EIB's support for Cepsa's decarbonisation strategy. It marks the third financing operation with Cepsa in the past two years, following an €80 million loan for photovoltaic plants in Andalusia and a €150 million loan for Cepsa’s network of electric charging stations in Spain and Portugal.

In 2023, the EIB Group provided over €21 billion in financing for energy security in Europe, with €4.5 billion allocated to Spain for renewable energy, energy efficiency, power grids, and storage systems projects. These investments are critical to Europe's transition to sustainable energy and reducing fossil fuel dependence.

In July 2023, the EIB Board of Directors increased the funding for REPowerEU projects to €45 billion. REPowerEU aims to end Europe’s dependence on fossil fuel imports, with the EIB expanding eligible sectors to include net-zero carbon emission technologies and critical raw materials processing. The additional financing, to be disbursed by 2027, is expected to mobilise over €150 billion in investment across target sectors.