Contrast (-) (=) (+)
Size (-) (=) (+)

Non-fossil energy initiatives

The business unit for New Energy was set up to boost and provide a business grounding to new initiatives that contribute to a more diversified future energy mix with a reduced intensity of carbon dioxide emissions

After the creation of the New Energies Business Unit in 2010, in 2011 we made progress in projects already underway, including AlgaEnergy, IBIL, KUOSOL and Orisol. Moreover, taking advantage of new investment opportunities in the field of non-fossil energy, Repsol New Energies acquired 100% of SeaEnergy Renewables, a company dedicated to promoting, developing and operating offshore wind farms in the United Kingdom.

Furthermore, we created Repsol New Energy Ventures, S.A. to invest in companies with a strong technological base whose results could be applied to group businesses.

In June we acquired 100% of Sea Energy Renewables, a company dedicated to promoting, developing and operating offshore wind farms in the United Kingdom.

Biofuels

During 2011, we continued to make progress in the KUOSOL project, designed to use biomass from jatropha curcas plantations, produce oil as a raw material for biofuels and generate electricity through cogeneration. At present, the project is focused on planting land related work.

We also remain involved in production of biofuels from algae in partnership with our investee company AlgaEnergy. In June 2011, the Technological Platform for Experimentation with Microalgae (PTEM in Spanish) was launched in terminal 4 of Madrid-Barajas airport. This project researches the capture of CO2 from airport facilities as a nutrient used by microalgae for conversion into biofuel. This project, with an estimated investment of €600,000, is an important achievement for research and development in this sector. The facility for this project, provided by AENA (Aeropuertos Espaoles y Navegacin Area), occupies an area of 2,000m2 , half of which is occupied by a greenhouse, allowing us to compare against the crop behavior and yield produced outdoors. Scientists from the Universities of Seville and Almeria, and the Spanish National Research Council are also collaborating in this project.

The biofuel unit also focused on assessing ethanol and vegetable oil projects, mainly in the northern region of Latin America, aiming at developing projects that are economically, environmentally and socially sustainable.

In 2011, Repsol hosted the United Kingdom-Spain bilateral seminar on microalgae and their application as biofuels, at the Repsol Technology Center. During the seminar, experts from both countries shared their knowledge on the subject and collaboration opportunities arose to make progress in this field. Notable topics of discussion were the important time for research in both countries, the need to reduce microalgae cultivation costs and discussion of their major environmental benefits. The seminar was closed by their Royal Highnesses the Prince and Princess of Asturias and the Prince of Wales.

Transport electrification

Throughout 2011, IBIL, the company in which Repsol New Energies and EVE (Ente Vasco de la Energa), the Basque Government's energy agency, each hold a 50% stake, has, since its creation in 2010, advanced in its effort to become the largest and most important electric vehicle charging provider in Spain. IBIL was the first company accredited by the Spanish Ministry of Industry and registered by the National Energy Committee as a company licensed to sell electric energy for recharging services after the entry into force of Royal Decree 647/2011, which regulates system charging manager activity as indicated in the Electricity Industry Act.

IBIL has managed the installation of a total of 109 posts, which allow electric vehicles to charge with full guarantees of safety and reliability, monitored at all times from the new control center located in Barakaldo (Bizkaia, Spain). It has also collaborated intensively with electric vehicle manufacturers, entering into joint marketing agreements with the vast majority (including Renault, Nissan, Peugeot, BYD-Build Your Dreams, Toyota) from within car dealerships.

In 2011, IBIL's scope of activity was extended to the whole of Spain. A national business plan was drafted for this purpose, which is already being rolled out. 2011 was also the year we created IBILEK, an hourly electric vehicle rental service. Through this new company we offer an alternative mobility service to private cars, offering users electric or hybrid plug-in vehicles, paying only for usage as they go. IBILEK was launched in December in Bilbao.

In short, 2011 was a year of major achievements for Repsol in terms of electric mobility, and we have taken the first steps towards new and significant challenges for the future.

Renewable electricity generation

In 2011, we continued working to promote renewable generation projects through our subsidiary Orisol in countries such as Spain, Italy, Romania and the United States, among others. Some important milestones are the start-up in Sierra de Arcas (Andalusia) and the awarding of 9 and 51 MW of the tenders in Aragon and Andalusia, respectively.

Moreover, we analyzed opportunities to invest in other renewable electricity generation projects such as geothermal energy and biomass, and we continue to point our development towards energies with a strong technological component, such as floating offshore wind technology (for depths of over 50 m), current and wave energy, and energy storage.

In June 2011, Repsol acquired 100% of the British company Sea Energy Renewables, an offshore wind farm promotion and development company based in Scotland. The acquisition cost came to €57 million.

Repsol currently has a renewable electricity generation capacity of 318 MW from wind, mini- hydraulic and cogeneration technologies through our stake in Gas Natural Fenosa. This produced 714 GWh of electrical energy in 2011.

Developing offshore wind energy in the United Kingdom

2011 was particularly important for the renewable generation area and its contribution to positioning the group in new initiatives with lower CO2 emissions.

The purchase of the Scottish company Sea Energy Renewables and, as a result, our acquisition of stakeholdings in developing 1,190 MW net of offshore wind energy in the United Kingdom is one example of this.

The United Kingdom is the leading country in developing offshore wind energy and its endeavor to promote investments in this technology is clear. It has set a target to have an installed capacity of 30-35 GW in 2020, as a way to achieve the emissions reduction targets set by the EU. Examples of this are the action plan published by the Government and a new regulatory framework that guarantees, in a clear and transparent way, proper remuneration for this technology.

All this support, together with our offshore capacity and our experience in managing complex projects, has been instrumental in Repsol's decision to join the offshore wind power sector in the United Kingdom.

These projects are well within the target deadlines; the development phase is estimated to be completed in 2013, at which time we must decide to start the construction phase, a period that will last approximately three years, to finally start commissioning as of 2016.

Map of the location of offshore wind farms