Speed limits and rail fares down in energy saving bid

 

In a dramatic push to reduce dependence on crude oil, Spain has raised its biofuel blending regulations and lowered both speed limits and rail fares, Deputy Prime Minister Alfredo Perez Rubalcaba announced earlier today.

The minimum proportion of biofuels to be mixed with mineral fuels, known as minimum blend, is to be raised to 7.0% from 5.8%, news which immediately saw shares in biofuel manufacturer, Abengoa, jump by 5%.

The fuel-saving measures, are also to include the lowering of speed limits on Spanish motorways from 120 kilometres per hour to 110 Km/h and a reduction of short and medium distance rail fares by up to 5%. Both will are to come into effect on March 7.

"A 10 euros increase in oil prices as has been seen in recent days increases our country's energy costs by 6 billion euros per year, or 500 million per month," Rubalcaba said at a weekly news conference after a cabinet meeting.

Spain has little or no oil reserves, making it heavily dependent on imported oil.

Crude prices have surged due to turmoil sparked by pro-democracy movements in North Africa and the Middle East. At 1442 GMT, Brent Crude LCOc1 was up 0.11 percent at $111.45 after several weeks of sharp gains. The industry ministry said in October it planned to gradually increase the minimum blend towards the 10 percent level set by the European Union for 2022.