Dear colleagues, professional public,
The Slovak Association of Fuel Industry and Trade (“SAPPO”) is entering a major milestone – symbolic 30 years of its operation. For three decades we have been active participants in discussions on significant changes in the fuel sector, from the phasing out of leaded petrol from the market, to the greening of fuels through the blending of bio-based components, as one of the first countries in the V4, to the current options for meeting transport decarbonization targets. We have achieved many successes, overcame various obstacles, and managed to become a recognized and respected voice of the fuel sector, mainly thanks to the proactive and professional approach of SAPPO members.
Looking at all the global challenges that the fuels and lubricants sector has faced and is facing, the last four years have undoubtedly been one of the most dynamic. The market uncertainty that began during the pandemic and intensified in 2022 due to the war in Ukraine and the changing business environment did not give our members and partners peace of mind even in 2023. The ongoing tensions caused by the already long-running conflict in Ukraine, and the overall complex geopolitical situation reinforced by the conflict in the Middle East, kept the stability of supply in constant jeopardy.
In light of these events, the phenomenon known as the energy “trilemma” in the energy sector has become fully manifested. At the same time, political leaders are trying to find a balanced approach to address three significant challenges, namely security of energy supply, and energy sustainability and affordability. In the same way, security and continuity of energy supply as well as energy affordability for all customers have been key priorities for SAPPO member companies in recent periods.
Thanks mainly to the tremendous commitment and efforts of the key refineries in the region, the continuity of supply of petroleum products has been maintained at a high level and none of the markets has experienced a crisis shortage. The extension of the exemption for the export of Russian crude oil products from Slovakia to the Czech Republic was hugely important in preserving fragile stability.
From a European perspective, 2023 also marked the final phase of negotiations for some of the proposals for revised legislation put forward as the “Fit for 55” package. On behalf of SAPPO, we have been closely monitoring the progress of the negotiations on the final form of the proposals to be transposed into national legislation. In particular, the Emissions Trading System directive (EU ETS II), the Renewable Energy Directive (RED III), and the so-called Carbon Border Adjustment Mechanism (CBAM) will have a significant impact on the fuel sector. The aforementioned legislation will entail amendments to the relevant national legislation, in particular, Act No. 309/2009 Coll. and Act No. 414/2012 Coll. on Emission Trading.
SAPPO has participated in initial discussions and consultations with the Ministry of the Environment of the Slovak Republic (MŽP SR) and Ministry of Economy (MH SR) in this regard, as SAPPO member companies recognize the importance of correct and effective implementation of the obligations. Under the EU ETS II, any obliged person who places fuel into tax-free circulation will have to apply for an emissions trading permit.
With regard to RED III, according to Article 25 of REDIII, a Member State can decide whether the 2030 renewable energy targets in the transport sector are to be met through an energy target or a GHG savings target, whereby the energy target for renewables in transport should be at least 29% in 2030 or, if a GHG savings target is set, the latter should be at least 14.5% in 2030. Meeting these targets will undoubtedly be a major challenge for obliged entities and is highly dependent on technological progress in the transport sector.
In connection with Act No. 98/2004 Coll. and the extension of EMCS from 13.2.2023 also to the transport of taxed mineral oil, there have been several technical discussions between our Association, the Ministry of Finance of the Slovak Republic (MF SR) and the Financial Directorate of the Slovak Republic (FR SR) on the practical implementation of the EMCS system in order to ensure the effective functioning of the system in application practice.
In parallel with the implementation of EMCS, intensive communication and consultations with the Ministry of Environment (MŽP SR), the Ministry of Economy (MH SR) and the Slovak Hydrometeorological Institute (SHMÚ) regarding the operation of the SK BIO database and the fulfilment of the obligations arising from Act No. 309/2009 Coll. continued in 2023.
At the same time, in connection with the submitted comments to the amended decrees under the authority of the Ministry of the Environment, which fall under Act No. 146/2023 Coll. on air protection, namely Decree No. 251/2023 Coll. on the quality of fuels, Decree of the Ministry of the Environment No. 248/2023 Coll. on requirements for stationary sources of air pollution and Decree No. 249/2023 Coll. on monitoring of emissions from stationary sources of air pollution, we participated in the adversarial proceedings and consultations with the Ministry of the Environment.
Another important activity of SAPPO during 2023 was the organization of several informative technical seminars as an educational and consultative activity for member companies with the participation of experts and relevant representatives from ministries on the topics of hydrogen fueling stations, fire legislation and EU ETS II. We consider it important to create a space for expert discussion, which at the end of the day is beneficial and enriching for all parties involved.
Last year SAPPO also participated in the organization of a joint event in cooperation with the Slovak Gas and Oil Association (“SGOA”), the Association for the Production and Use of Biofuels (“ZVVB”) and with the participation of the Association of road transport operators of the Slovak Republic (“ČESMAD”) on the topic of technological neutrality in the decarbonization of the transport sector. The aim of the meeting was to highlight the fact that a balanced technology mix, which recognises the important role of all available energies, can represent an optimal solution on the path to low-carbon transport and minimise social and economic impacts.
In today’s unpredictable environment, it is important for us to create regulatory frameworks that are, first and foremost, predictable, applicable and provide opportunities for the development of all available technologies. I believe that setting rules that do not discriminate against any technology and provide room for diversification of sources and products could go a long way towards solving today’s challenges – security of supply and the development of sustainable energies that are accessible to everyone.
Dear Colleagues,
I would like to thank all members of the Association, the experts of the working sections for their energy and tireless work. I am confident that we will successfully build on previous activities and have an unending commitment to move our industry forward.
Sincerely
Ľuboš Dinka
Chairman of the Executive Board
SAPPO