DOE urges more ethanol investments

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The Department of Energy (DOE) on Thursday called for more investments in ethanol production in the wake of a United Nations (UN) panel study citing that local oil companies are still hard put to comply with the required 10 percent ethanol blend (E10) for gasoline.

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DOE Director Mario Marasigan admitted that local production of ethanol is insufficient for local oil companies to comply with the E10 requirement.

“Even with the new plants going on-stream by next year, our local production
remains insufficient. We need more investments on the same,” he told reporters.

Marasigan added, “We have to invite more private sector participation. What we need to look into should be the difficulties of the private sector in coming up with the ethanol production projects and the government should be able to address such difficulties.”

The DOE director also urged Congress to review Republic Act 9367 or the Biofuels Act of 2006, which requires oil companies to blend gasoline with 10 percent ethanol, after the United Nations Conference on Trade Development (UNCTAD) concluded that the law failed to meet its goals.

The Biofuels Law aimed, among others, to lessen the country’s dependence on high-priced imported fuel, create economic opportunities and spur countryside development.

According to the law, all gasoline sold in the country must contain at least five percent ethanol by February 2009. The mandated amount of mixture was raised to 10 percent in 2011, as provided by the statute.

UNCTAD, however, observed that the country produced only 85 million liters of ethanol or merely 30 percent of the total local demand in 2012.

Its study further noted that 70 percent of the country’s ethanol requirement is sourced abroad.

According to UNCTAD, local oil companies are pressed to import ethanol from other countries in order to comply with the government’s E10 requirement.

It added that the country principally relies on ethanol imports from Thailand.

UNCTAD, however, said the country’s supply of imported ethanol might be in danger as Thailand is seen to concentrate on fulfilling the ethanol demands of its domestic market.

Since it implemented its 10-year Alternative Energy Development Plan (AEDP), Thailand has more than doubled its ethanol consumption in the last six years, according to the study.

The AEDP aims to increase Thailand’s use of alternative energy from 9.4 percent of its present total energy consumption to 25 percent in 2021.

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