BiofuelsMarket Biofuels Market Sweden

October2009

ExecutiveSummary
EnergysuppliedbybiofuelsintheSwedishmarketstoodat120TWhin2007andisforecastedto riseto144TWhin2030and230TWhin2050 TheSwedishbiofuelsmarketisdominatedby
Ethanol,BiodieselandBiogas , g

Market

Drivers CostIncentives FluctuationsinCrudeOilPrices SupportforGreenCarOwners HighGrowthinEthanolVehicles BiofuelsMarketBeingDominatedbyImports Cli t ClimateandEnergyPolicy dE P li BiogasVastProject ResearchandDevelopmentProjects OtherPoliciesTowardsDevelopingtheIndustry

Drivers& Challenges

Challenges ResistancefromtheSwedishForestry Industry Foodvs.FuelIssue F lI F d HurdleswithBiogasSupply

Government Initiatives

Themarketishighlyfragmentedandcomprisesoffewlargeplayers Largescaleimportshasledtothegrowthofanumberofsmallplayers

MajorPlayers
MajorPlayers SEKAB

Ethanol LantmannenAgroetanol

BIodiesel LantmannenEcobransle PerstorpBioProducts

Biogas LackebyWaterGroup Malmberg

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Introduction MarketOverview Market Overview Drivers&Challenges GovernmentPoliciesandInvestments MajorPlayers KeyDevelopments

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TheEuropeanUnionbiofuelsmarkethasbeengrowingstrongly withGermanyandFrancebeingthemarketleaders
Overview
On23January2008,theEUproposedthatthe overallenergytargetwouldstandat
20%renewableenergyuseby2020 10%minimumtargetforthemarketshareof biofuelsby2020

Biodiesel
000MT
10,000 8,000 6,000 4,000 2,000 2 000 0 2006

Germanyis thelargest producer

Production

TheEUhassetatargetofincorporating5.75% g p g biofuelsintransportationby2010

Imports p Exports 2007e 2008e 2009f 2010f

SegmentationofUsageinTransportation
5% 20% Biodiesel Bioethanol VegetableOils V t bl Oil

Bioethanol
000MT
3,000 2,500 2,000 1,500

Franceisthe largest producer

Production

Imports

75%

1,000 500 0 2006

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Exports 2007e 2008e 2009f 2010f 4

NOTE:Biogasaccountsforanegligibleshare

MajorEuropeaninitiativestowardsdevelopingthebiofuels market
1992:CAP allowedfornonfoodcropsto begrownonsetasidelandwithout losingthesetasidepremium.The amountofoilseedsgrownonsetaside landiscontrolledbytheBlairHouse Agreement. 2003:BiofuelsDirective(indicativetargets2%by2005, 5.75%by2010) EnergyTaxationDirective RevisionofFuelQualityDirective(gasolinenorms) Revisionofdieselnorms&Biodieselqualitynorms CAPReforms(changeinenergycroppremium)

1990 1992: Introduction Introduction ofthe Common Agricultural Policy(CAP)

1995 1997: Whitepaper White paper onrenewable energies

2000 2000: Greenpaper Green paper onenergy supply security

2005 2006: EUsBiofuels EUs Biofuels Strategy

2008 2008:Drafted renewable renewable energy directive

2007:RenewablesRoadmapandRevisionofBiofuelsDirective RevisedFuelQualityDirective upto10%ethanolblending;reductioningreenhouse Revised Fuel Quality Directive up to 10% ethanol blending; reduction in greenhouse gasemissionfromtransportfuelby1%peryearbetween2010and2020
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Introduction MarketOverview Market Overview Drivers&Challenges GovernmentPoliciesandInvestments MajorPlayers KeyDevelopments

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BioenergymarketinSwedenhasdevelopedduetomajor governmentinitiatives
Overview
Bioenergysharehasincreasedby3%since 1970 About90%ofbioenergyusedinSweden comesfromtheforestrysector Theshareofbioenergyderivedfromthe agriculturalsectorissmallatpresent agricultural sector is small at present
Intotal,around2%ofSweden'sarablelandis usedsolelyforenergyproduction

BioenergyShareofTotalEnergyUse
%
30 20 10 0 9 11 28

+3%
20 15

24

1970

1980

1990

2000

2004

2007

PrimaryUsesofBioenergy
ApplicabilityofBioenergy

ElectricityConsumptionMix
TWh
1,400 1,200 1,000 800 600

1,370 +7% 35% 704 504 14% 69% 16% 1% 2005 537 15% 66% 17% 1% 2006 25% 51% 3% 19% 1% 2010e Wind Hydro Biomass 28% 18% 13% 2% 4% 2020e Photovoltaic GeoThermal Others

Electricity Generation

UsedasFuel

Heating Purposes

400 200 0

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BiofuelscontributiontototalenergyconsumptioninSwedenhas beenrisingandisexpectedtogrowinthefuture
Overview
Thetotalenergysharecontributedbybiofuelshas risenby32%over200307 Inabsoluteterms,energygeneratedhasincreasedby 3%overthesameperiod TheSwedishbiofuelsmarketisdominatedby
Ethanol Bi di l Biodiesel Biogas

TotalEnergySuppliedbyBiofuels
TWh
150 105 100 50 0 108

+3%
109 116 120

2003

2004

2005

2006

2007

BiofuelShareoftotalenergy
%
4 3 2 1 0 1.32 2.28

RiseinEnergySuppliedbyBiofuels
TWh
4.00

+32%
3.10 2.23

250 200
150 100 50 0 120

+2% +1%
144

230

2003

2004

2005

2006

2007

2007

2030e

2050e

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EthanolisthemostwidelyusedbiofuelinSweden,supplyis largelydrivenbyimports
Overview
Ethanolisthemostcommonliquidbiofuelin Sweden Itaccountsforapproximately90%ofallliquid biofuelusedin2008 LargestconsumerofbioethanolintheEU
80% of total imports mostly from Brazil is 80%oftotalimports,mostlyfromBrazil,is consumedinSweden

Ethanol

TotalSupply
Production MT
500 400 300 200 100 0

Import p 334 21%

500 14%

460 22%

316 19% 81% 2006

86% 79% 2007 2008

78%

2009

SegmentationofProductionBase
Cereals 20% Wood

QuantityofFeedstockUsed
MT
600,000 400,000 200,000

Wheat Barley Rye 413,000 320,000 81% 9% 2006 9% 336,000 80% 10% 10% 2007 80% 12% 8% 2008 15% 6% 2009 79% 598,000

80%

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BiodieselmarketinSwedenhasshownpromisinggrowthdueto variouspoliciesandtheavailabilityoffeedstock
Overview
Biodieselcanbeproducedfromdifferent vegetableoils InSweden,biodieselismainlyproducedinthe formofRME(rapemethylesther)fromrape seedoil Since2006,biodieselisblendedat5%with Since 2006 biodiesel is blended at 5% with fossildieselinthecounty Governmentinitiativeshasallowedthis segmenttogrow
V i Varioustaxexemptiononbiodiesel i bi di l Extensiveplanstowardsdevelopingnewbio dieselplants Inordertoenhancedomesticusage,the GovernmentplansonimplementinganewEU Government plans on implementing a new EU biofueldirectivewhichisexpectedtoincreasethe blendinglevelfromtheexisting5%to7%byJuly 1,2010

Biodiesel

TotalSupply
Production MT
150 100 50 0

Import p 140 120 60 33% 67% 2006 58% 42% 2007 120 67% 33% 2008 71%

29% 2009

QuantityofFeedstockUsed
MT
150,000 110,000 100,000 64,000 50,000 0 36,000

RapeseedOil
132,000

2006

2007

2008

2009

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BiogasmarketinSwedenhasgrownsteadilyandisstillina nascentstagewithmajorpotential
Overview
Totalbiogaspotentialfromdomesticresidual productsis10.6TWh/year
Thisisequivalentto12%oftheenergy consumptionattributabletoroadtransport

Biogas

TotalSupply
000tonnesofoileq./yr
20 15 10 5 0 9 14 11 15 16

Potentialforbiogasproducedfromthe residualproductsofforestindustryis p y estimatedtobe59TWh/year Biogasisexpectedtodevelopfurther

Biogasoffersthelargestreductioningreenhouse gasescomparedtootherbiofuels gases compared to other biofuels Gaininglargescaleacceptanceasvehiclefuelthat generatestheleastemissionsofgreenhouse gases Sinceitisproducedfromwasteandresidual products,itavoidsanycompetitionwithfood production

2003

2004

2005

2006

2007

Potential:DomesticResidualProducts
10% 7% 7% Agriculture FoodWaste Food Waste SewageSludge FoodIndustry andothersectors 76%

Itisexpectedtobecapableofsupplyingfuel to~20%ofthevehiclefleetinSwedenby 2020

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Introduction MarketOverview Market Overview Drivers&Challenges GovernmentPoliciesandInvestments MajorPlayers KeyDevelopments

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DriversandChallenges

Drivers
CostIncentives Cost Incentives FluctuationsinCrudeOilPrices SupportforGreenCarOwners HighGrowthinEthanolVehicles BiofuelsMarketBeingDominatedby i f l k i i db Imports

Challenges
ResistancefromtheSwedishForestry R i f h S di h F Industry Foodvs.FuelIssue HurdleswithBiogasSupply

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Constantlyincreasingtaxesonconventionalfuelswillboostthe usageofbiofuels
CostIncentives
TheSwedishtaxationpolicyiscreatingdemandforbiofuels Twotypesoftaxesareleviedontheuseoffuels
FiscalTaxes:Thisincludesthegeneraltax EnvironmentalTaxes:IncludestaxesonCO2,SOxandNOxemission

Impact

Thetaxationlevelhasbeenconstantlyincreasinginordertopropagatetheuseofbiofuelsand towardsreducingthelevelofgreenhousegassesemitted ConventionalGas

USD/liter
1.5 1.0 0.5 0.0

DieselOil
EnergyTax USD/liter
0.8 0.6 0.4 0.2 0.0

+22% 0.65 0 65 0.17 0.41 0.07 0 07 2008

+5% 0.96 0.43 0.34 0.19 0 19 2008 1.01 0.45 0.36 0.20 0 20 2009

CO2Tax VAT

0.79 0.19 0.44 0.16 2009

Allbiofuelsaretaxfreetill2013.Theyareexemptedfromenergytaxandcarbondioxidetax thusbeingacosteffectiveoptionforconsumers

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Feasibilityintheusageofbiofuelsoverordinaryfuelsisexpected todrivethemarket
FluctuationsinCrudeOilPrices
Swedendoesnotproducecrudeoilandisthuscompletelydependentonimportsforits domesticpetroleumneeds
USD/barrel
600

Impact

PetroleumConsumption
1%

400 200 0 1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

Thepetroleumconsumptionlevelshavebeensteadilydecreasingduetotherecentvolatilityin pricesofcrudeoil i f d il Thishasactedasadriverforthebiofuelsmarketasplayersaremoreinclinedtowardsfocusing ondevelopingalternativerenewablefuelsources

CrudeOilPrices
USD/barrel
150 100

71.69
50 0 Sep07 Nov07 Dec07 Jan08 Feb08 Jul08 Sep08 Nov08 Dec08 Jan09 Feb09 Mar09 Apr09 May09 Jun09 Jul09 Aug09 Sep09

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Supportforgreencarownerswillincreasethedemandfor vehiclesoperatingonbiofuels
SupportforGreenCarOwners
Manypolicieshavebeenadoptedtowardscreatingincentivesforprospectivecarbuyersto purchaseavehiclewhichrunsonbiofuel In2006,aCO2basedvehicletaxwasintroducedinordertoencouragethepurchaseofenergy efficientvehicles,thusreducingemissionsinthetransportsector BasedonalegalactinApril2006,largefuelstationsarerequiredbylawtoofferatleastone alternatefuel
The act applies to filling stations with a sales volume of more than 3 000 m of petrol or diesel Theactappliestofillingstationswithasalesvolumeofmorethan3000mofpetrolordiesel Thisincludes~15%ofthetotalfuelstationsamountingtonearly4000fillingstations Arevisioninpolicyisexpectedinordertoencompass60%ofallfillingstationstosellarenewablevehicle fuelby2010

Impact

Thiswasforwardedinordertoenhanceavailabilityoffuelwhichwillleadtoalargerconsumer basedemandinggreencars Furthermore,privateindividualspurchasinganewecofriendlycarbetween1April2007and31 December2009areliabletoreceiveasubsidyofUSD1,456.9

TheGovernmentinitiallyearmarkedatotalofUSD36.4mnforsubsidies,butthiswasincreasedin2008as thedemandforecofriendlycarswashigherthanexpected the demand for eco friendly cars was higher than expected

Stategovernmentshavealsotakenstepswhichisexpectedtodevelopthisindustry
AsofAugust2007,apermanentcongestionchargehasbeenintroducedinStockholm.Greencarsare exemptfromthischarge

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Boomingmarketforethanolvehicleswillattractmoreplayersto thissector
HighGrowthinEthanolVehicles
EthanolcarsbeingsoldinSwedenhasbeengrowingdynamicallyat95%overthelastdecade Thegovernmenthasbeencontributingtothisrisethroughadirectivewhichwaspassedon February1,2009statingthatallcarspurchasedbythegovernmentauthoritiesand50%of F b 1 2009 i h ll h db h h ii d 50% f emergencyserviceshavetobeenvironmentallyfriendly NumberofEthanolCarsSoldinSweden
+95%
17,232 25,868 35,499 57,628 146,976

Impact

717

1,926

1,669

1,074

2001

2002

2003

2004

2005

2006

2007

2008

2009

SegmentationofGreenCarsintheMarket
Biogas Hybrid Gasoline Diesel (emit <120 gm CO2/km) Diesel(emit<120gmCO2/km) 4.3
1.6

Ethanol 68.4 100.0

12.9

12.8

This acts as a major incentive for fuel manufacturers to develop new facilities producing biofuels Thisactsasamajorincentiveforfuelmanufacturerstodevelopnewfacilitiesproducingbiofuels andtheriseindemandisexpectedtocontinueinthefuture
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Largeimportsofbiofuelsisexpectedtoleadtoplayers producingbiofuelsdomesticallyatlowercosts
BiofuelsMarketBeingDominatedbyImports
Amajorsupplyshortageexistsinthissectoraslargefractionsofbiofuelsareimported Thisprovidesstrongopportunitiesfordomesticplayerstodevelopindigenousfacilitiestowards manufacturingbiofuels f i bi f l Thislargescaledemandwilldrivegrowthindomesticproductionallowingforplayerstosupply atalowerpriceallowingthemtocapturealargemarketshare ShareofEthanolImported Share of Ethanol Imported
EthanolData TotalSupply(MT) pp y ImportLevel(MT) ShareImported(%) 2006 316 256 81 2007 334 264 79 2008 500 430 86 2009 460 360 78

Impact

ShareofBiodieselImported Share of Biodiesel Imported

BiodieselData TotalSupply(MT) pp y ImportLevel(MT) ShareImported(%) 2006 60 40 67 2007 120 50 42 2008 120 40 33 2009 140 40 29

EUdirectivesontheotherhandhaveboostedinterestamongSwedishimportersofbiofuel throughtheirdirectivepassedinApril2009
ItallowedethanolimportedfromBrazilforuseinE85(forcars)andED95(forbusesandtrucks)fuelstobe categorizedasachemicalproductforblendingwithgasoline,therebyexemptingtheproductfromthemuch higherdutiesthatareimposedonimportedagriculturalproductsfromthirdcountries

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Majorbarriersinthemarketincludetheresistancefromthe forestindustryandtheusageoflandtogrowenergycrops
ResistancefromtheSwedishForestryIndustry
Alargefractionoftherawmaterialsusedtogeneratebiofuelsisattributedtotheexpansive forestsinSweden Thereisahighriskofcompetitionforforestlandandforestrawmaterialsbeingusedforthe energysectorontheonehandand,ontheother,theSwedishforestindustrywhichaccounts forlargeexportrevenuesandemploymentinSwedensruralareas Thisclashofinterestwillactasachallengetoamarketwithastrongpotentialformajorgrowth inthefuture in the future

Impact

Foodvs.FuelIssue
Inordertogeneratebiofuels,agriculturallandisoftendivertedfromtheproductionoffood cropstotheproductionofenergycrops Thisisapointofcontentionasmoreextensivecultivationofenergycropsonarablelandmay leadtoadropinfoodproduction Furthermore,theforestindustrymayexperiencedifficultinobtainingforestrawmaterial Thisissuecanbeaddressedbydevelopingmoreefficientsecondgenerationbiofuels
Secondgenerationtechnologyreferstotheproductionofbiofuelsonalargescalefromwood,grasses,or nonediblepartsofplants

Impact

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Infrastructuralshortcomingsleadingtotheinabilitytomeet demandforbiogasisachallengethemarketfaces
HurdleswithBiogasSupply
BiogasproductionisunabletomeettheconstantlyincreasingdemandinSweden Manynewfillingstationsarebeingdevelopedhowever,thedemandforbiogasisstilllarger thanthesupplyinmanyregions Oneoftheprimaryreasonshinderingplayersfromenteringthissegmentistheuncertaintyin longtermmarketdemand ThepotentialmarketinSwedenforbiogashasnotbeentappedasitistimeconsumingand costlytobuildafunctioningdistributionsystem tl t b ild f ti i di t ib ti t
Newlocaland/orregionalpipenetworksarerequiredtobelaidforbiogas,sincetheexistinggasgridin Swedenislimitedtocertainpartsofthecountry

Impact

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Introduction MarketOverview Market Overview Drivers&Challenges GovernmentPoliciesandInvestments MajorPlayers KeyDevelopments

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GovernmentPoliciesandInvestments

OtherPoliciesTowards DevelopingtheIndustry

ClimateandEnergyPolicy

Key Initiatives
ResearchandDevelopment Projects

BiogasVastProject

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GovernmentPoliciesandInvestments(1/4)
ClimateandEnergyPolicy TargetstobeAchievedby2020basedonEUDirectives 50%oftotalenergyconsumptionwillbeviarenewableenergy f l ll b bl Biofuelswillaccountfor10%oftotalfuelconsumptioninthetransportsector Inaddition,by2020,theEUistoachievethegoalofimprovingenergy efficiencyby20% 40%reductioningreenhousegasemissions d h
Biofuelswillplayamajorroleas30%ofnationalemissionsisaccountedforbythe transportationsector

Initiatives ByJuly2010,thegovernmentplanson enhancingfuelefficiencybyadheringtothe newEUfuelqualitydirectivewhichallowsfor amixtureofupto10%ofethanoland7%of biodiesel Furtherusageofeconomicinstrumentssuch ascarbondioxidetax Improvementintheinfrastructureforbiofuel supply

Impact p Majorinvestmentsinresearchand developmentprojectstowardsthe developmentofsecondgenerationtechnology OnJune16,2009aGovernmentBillwas On June 16, 2009 a Government Bill was passed
Targetfor2030 Swedishcarfleettobe independentoffossilfuels Targetfor2050 Zeronetemissionsofgreenhouse gasesintotheatmosphere gases into the atmosphere

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GovernmentPoliciesandInvestments(2/4)
BiogasVastProject Thegovernmenthasbeentakinginitiativestowardsthedevelopmentofbiofuelprojects throughapublicprivatepartnershipmodel through a publicprivate partnership model BiogasVastistheworldsfirstregionalprojectforbiogasasvehiclefuel Itcommencedin2001 Participantsintheprojectinclude30privatelyandpubliclyownedcompanies,organizations, publicauthoritiesandmunicipalauthorities Thisprojectprimarilypursuesmarketdevelopmentwithinbiogasproduction,thedistribution andexpansionofgasfuellingstationsandtheuseofgaspoweredvehicles Itisalsofocusingondevelopingbettertechnologyallowingforlargescaleexports In2001
Therewere9gasfuellingstationsand~800biogasvehiclesinwesternSweden

Introduction

Purpose

Impact

By2008
The infrastructure in Western Sweden developed more than other regions in the country TheinfrastructureinWesternSwedendevelopedmorethanotherregionsinthecountry 36gasfuellingstationsand~7,000vehiclesand8facilitiesproducingbiogasforautomotivepurposes

Investments

Investmentinbiogasfacilities,theinfrastructure,fuellingstationsandpipelineshaveamounted to~USD97.6mn I Investmentinthedevelopmentofgaspoweredvehicles cars,lighttransportvehicles,buses t t i th d l t f d hi l li ht t t hi l b andtrucksstandsat~USD262.3mn USD291.3mn

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GovernmentPoliciesandInvestments(3/4)
ResearchandDevelopmentProjects Introduction Thegovernmenthasbeenconstantlypromotingtheuseofbiofuelsandenvironmentfriendlycars throughlargescaleinvestmentsinR&Dprojects through large scale investments in R&D projects
MajorR&DInitiativesFundedbytheGovernment 2007 2007 TheSwedishEnergyAgencypumpedinUSD0.5mninTaurusEnergysprojecttowardsdevelopingpentosetechnologyinorderto increasetheyieldofethanolby40% TotalinvestmentaidforthedevelopmentofrenewableenergystoodatUSD64.6mnoutofwhich37%wasaccountedforby biofueldevelopment TheSwedishEnergyAgencyinvestedUSD5.6mninthedevelopmentofethanolprocessingatthepilotplantinOrnskoldsvik beingcarriedoutbySEKAB.Purposeoftheprojectwastoproduceethanolfromcellulose,afeedstockthatcouldinthefuture replacecerealandsugarcaneintheproductionofethanolthusleadingtothegrowthofsecondgenerationbiofuels replace cereal and sugarcane in the production of ethanol thus leading to the growth of second generation biofuels SwedishGovernmentisinvestingUSD61.2mninenergyefficiencymeasureswhichwillbeimplementedinpoliciesrelatedto environment,forestry,agricultureandenergy ThegovernmentprovidedsupportofUSD47.5mnforgreencarrebates ThegovernmentplansoninvestingUSD40mntopartiallyfinanceresearchintoenvironmentallyfriendlyvehicles The government plans on investing USD 40 mn to partially finance research into environmentally friendly vehicles ThegovernmentplansoninvestingUSD127.5mntoallowforresearchanddevelopmentinitiativestobemadeavailable commercially.Thisisexpectedtoleadtomoredemonstrationplantsforsecondgenerationbiofuelsandotherenergytechnology. AninvestmentofUSD49.3mnisexpectedinordertoassistthedevelopmentofenergytechnologythathasnotyetbeen establishedinthemarket,suchasbiogas AnewfiveyearsupportprogramformoreefficientenergyuseofUSD43.7mn/yrisexpectedtobeimplemented

2008

200810 2009 2009

200911

201014

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GovernmentPoliciesandInvestments(4/4)
OtherPoliciesTowardsDevelopingtheIndustry Transport Plansonraisingthe emissionstandardsfor automotive manufacturersat highestpermissible level Riseinvehicletaxby USD0.65/gmofcarbon dioxideemitted dioxide emitted Replacementofthe cashbonusgivento greencarownerswitha longtermtax concession Raiseenergytaxon dieselbyatotalofUSD 0.06/literby2013 Supporttoproductionof biofuelfeedstock Enhancingtheenergy aid,whichcurrently standsatUSD67.5/ hectare,availableto farmersproducing energycropsunderEU regulations Initiationofarural developmentprogram development program for20072013which willbeutilizedtowards supportingand improvingthe productionand processingof renewableenergycrops BudgetBill2009 Majorpoliciestowards moveawayfromthe dependenceonfossil fuels Allocated~USD437mn towardssupporting developmentmeasures intheclimateand energyareaoverthe energy area over the period20092011 Proposedplansinclude anumberofmeasures intendedtopromote thedevelopmentof newenergytechnology Klimp TheSwedish Environmental ProtectionAgencys climateinvestment programme Aimedatdeveloping productionfacilitiesfor liquidbiogasandthe developmentof development of requiredinfrastructure Theprogrammeis expectedtocontinue till2012 Cumulativeinvestments sinceitsinceptionin 2003ispeggedatUSD 72.8mn

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Introduction MarketOverview Market Overview Drivers&Challenges GovernmentPoliciesandInvestments MajorPlayers KeyDevelopments

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PlayersintheMarket(1/5)
CompanySnapshot:AtraxEnergi
CorporateInformation
Headquarters Founded AreaofExpertise Financials KeyPeople Stockholm 1982 Consultantsinthefieldofalternativefuels NA NA

BusinessHighlights
AppliedfortheUSD127.5mnthattheSwedish energyauthoritiesaredistributingforthe developmentofnewenergytechnology Plansoncarryingoutatestprojecttowardspowering transportvehiclesandtrucksbya"new"biobased fuelsinexistingdieselengines,withoutproper fuels in existing diesel engines without proper modificationsoroptimization MonitoringconstructionofanethanolplantinGhent

CompanySnapshot:Chemrec
CorporateInformation
Headquarters Founded AreaofExpertise Financials KeyPeople Stockholm 1987 Creatingbiorefineriesthroughblackliquor gasificationtechnology NA JonasRudberg CEO Jonas Rudberg CEO AndersNeld CFO

BusinessHighlights
Developedanewtechnologyforbiofuelgeneration usingwastefrompulpmills MajorinvestorsincludeVantagePointVenture Partners,VolvoTechnologyTransfer,Environmental TechnologiesFund,NykombSynergetics FullimplementationofthetechnologyinallSwedish pulpmillsisexpectedtoyield 6mntonsofCO2 pulp mills is expected to yield ~6 mn tons of CO2 reductionperyearor10%ofcurrentSwedishCO2
28

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PlayersintheMarket(2/5)
CompanySnapshot:LackebyWaterGroup
CorporateInformation
Headquarters Founded AreaofExpertise Financials KeyPeople Lackeby Lackeby 1935 Biogasproduction 08:Revenue USD100mn; StefanLambert Chairman Hjelm,Peter CEO

BusinessHighlights
Operatesin70countriesworldwide Thecompanyhasbeenlargelyfocusingon internationaloperationsasdomesticbiogasmarketis atanascentstage

CompanySnapshot:LantmannenAgroetanol
CorporateInformation
Headquarters Founded AreaofExpertise Financials KeyPeople Norrkoping 2001 Refinesgrainintobioethanolforthefuel market NA MonikaLekander MD Monika Lekander MD OveHogman COO

BusinessHighlights
ItisthelargestethanolproducerinSweden Ithasayearlycapacityofabout160,000MTof ethanol In2008,developedanewethanolproductionfacility inNorrkopingwhichreachedfullproductioncapacity byJanuary2009

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PlayersintheMarket(3/5)
CompanySnapshot:LantmannenEcobransle
CorporateInformation
Headquarters Founded AreaofExpertise Financials KeyPeople Karlshamn NA Manufacturesandmarketsbiodiesel NA NA

BusinessHighlights
SubsidiaryofLantmannenEnergy,partof LantmannenGroup Theirplanthasbeenrunningsince2006andhasa capacityofproducing100000tonnesRME,withat least50%oftherawmaterialbeingused domestically

CompanySnapshot:Malmberg
CorporateInformation
Headquarters Founded AreaofExpertise Financials KeyPeople Ahus 1866 Renewableenergysolutionsprovider 08:Revenue USD42mn;Profit USD 0.45mn Akamai PresidentandCEO Akamai President and CEO LarsJosefsson CFO

BusinessHighlights
Thecompanyhasbeenupgradingbiogasplants acrossEurope Someprojectsinclude
LundsEnergisoperationsinSweden Wetschen,nearHanover;DarmstadtWixhausen;and KasselinGermany It has also carried out operations in the field of gas Ithasalsocarriedoutoperationsinthefieldofgas cleaninginAustria

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PlayersintheMarket(4/5)
CompanySnapshot:NordiskEtanolproduktion
CorporateInformation
Headquarters Founded AreaofExpertise Financials KeyPeople Karlshamn 2006 Ethanolandbiogasproduction NA MikaelRuneson President JorgenAndersson Chairman

BusinessHighlights
Productionfacilitylocatedinfacilitiesareinthecity ofKarlshamn,locatedinBlekingecountyinsouth Sweden Thecompanyplansonexpandingoperationstowards producing130,000m3 annually Italsoplansonproducingbiogasfromthisfacility

CompanySnapshot:Opcon
CorporateInformation
Headquarters Founded AreaofExpertise Financials KeyPeople Stockholm 1908 Industrialtechnologycompany 08:Profit USD60.9mn;Profit USD15.6 mn MatsGabrielsson Mats Gabrielsson Chairman RolfHasselstrom President

BusinessHighlights
ReceivedanorderworthUSD5.1mnforanadvanced bioenergyplantatSkapaforsmill,insouthwestern SwedenforRexcellTissueandAirlaid S d f R ll Ti d Ai l id
Biomasswillbeusedasafuelinsteadofoilandelectricity. Itwillhavea9MWjointcombustionsystemwhichwill produceprocesssteam

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PlayersintheMarket(5/5)
CompanySnapshot:PerstorpBioProducts
CorporateInformation
Headquarters Founded AreaofExpertise Financials KeyPeople Perstorp NA Biodieselandbiogasproducer NA NA

BusinessHighlights
Scandinavia'snumberonebiodieselproducer PlansonsettingupfillingstationforpureRMEin PerstorpisassociationwithBiofuelExpress DevelopedVerdisPolaris,anewrenewablediesel fuel.ItisprimarilyRMEofahigherquality
ConduceevenforthenorthernpartsofSwedenwhich experiencesextremelylowtemperatures

CompanySnapshot:SEKAB
CorporateInformation
Headquarters Founded AreaofExpertise Financials KeyPeople Key People Ornskoldsvik 1985 Bioenergycompanyfocusingonethanol production 06:Revenue USD276.8mn AndersFredriksson CEO Anders Fredriksson CEO

BusinessHighlights
Ethanolisproducedfromthebyproductsofpaper pulpproductionbySEKABinitsplantlocatedin Ornskoldsvik O k ld ik
TheplantreceivedfundingofUSD5mnfromtheSwedish energyauthorityEnergimyndighetenallowingtheproject forproducingethanolfromcellulosetocontinue Produces300400litersofethanol/day

Thecompanyplansondiscontinuingitssalesof ethanolfuelE85(15%gasolineand85%ethanol)
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Introduction MarketOverview Market Overview Drivers&Challenges GovernmentPoliciesandInvestments MajorPlayers KeyDevelopments

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KeyDevelopments
Date Sep2009 Development TheSwedishEnergyAgencyawardedagrantworthUSD72.8mntoChemrecsfacilityinOrnskoldsvik. Thegrantisintendedfortheproductionofbiofuelfromblackliquor,ahighenergy,viscousbyproduct fromthepulpindustry. f th l i d t SwedishforestrygroupSodrabegana2yearstudywithrapeseedmethylester(RME)insixvehiclesto assesstheeffectontheenvironment,economyandmachinery.Thetrialsareexpectedtobecompleted inJanuary2011. SwedishtechnologyfirmMantex,whichhasdevelopedanautomated,continuousmethodtodetermine biomassmoistureconcentration,receivedfundingfromGermanutilityRWE. Scania,aSwedishtruckandbusmanufacturer,supplied85ethanolpoweredbusestoBusslinkiSverige. ThisisthelargestsinglebusorderinSwedensince2004. Vapo,aFinnishpeatproducer,plansondevelopingabiodieselplantinJonkoping. V Fi i h d l d l i bi di l l i J k i SweboBioenergi,whichissellingatechniqueforburningbiofuelssuchaswoodchipsandfirewood, raisedUSD2.2mnincapitalinordertoexpandintonewmarkets.SustainableTechnologiesFundmade thislargeinvestment FinnishcompanyST1isplanningtostartethanolproductioninSweden.Thecompanyoperatesmorethan Finnish compan ST1 is planning to start ethanol prod ction in S eden The compan operates more than 40automaticpumpstationsinSweden.

Jul2009

Jul2009 June2009 June2009 J 2009 May2009

Mar2009 Mar 2009

Feb2008 EUapprovedSwedensapplicationtocontinuetoimportethanolfrombrazilforprocessingintobiofuels atasubsidizedrate.Theinitialplanwasrevisedwhichcalledfora30%increaseinimportduty.

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