As a means to help millions of coconut farmers currently suffering from low copra prices, the Department of Energy (DOE) is looking to review the impact of a possible increase in the biodiesel blend to 5 percent as requested by the Department of Agriculture (DA).

“There is a request by Agriculture Secretary [Proceso] Alcala to increase the mix of biodiesel from the current 2 percent to 5 percent,” said Energy Secretary Jericho Petilla.

He explained that the Agriculture department made the request to increase the biofuel mix, because of the problem on the low prices of copra.

“We’re actually reviewing just to make sure there is no impact towards the consumers,” Petilla added.

He said that both departments are currently computing whether the higher blend will result to higher pump prices for diesel.

“It will also probably accelerate the move to actually increase the indigenous portion of our fuel so we’re thinking about that now, increasing it. It’s only talk, we’re making a study but nothing is final,” Petilla said.

Asian Institute of Petroleum Studies Inc. Executive Director Rafael Diaz said that this is the best time to increase the biodiesel blend, since the price of biodiesel is so low that it is almost at parity with that of imported of diesel as a result of low coconut oil prices.

He noted that the additional 3 percent biodiesel blend will translate to just 15 centavos a liter.

“The additional amount of 15 centavos to effect a B5 [5-percent blend] is minimal because, unlike imported diesel which has price adjustments monthly and increasing by an average of 50 centavos per liter, the adjustment in CME [cocomethyl ester] blend is not a monthly event nor even yearly. The next adjustment to B7 [7-percent blend] to conform to the mandate of a Tier 6 diesel specification will not occur before 2020,” Diaz said.

Dollars savings
He added that raising the blend will also reduce diesel imports by P12.25 billion and translate to foreign exchange savings of $298.8 million.

“The higher mileage resulting from the use of biodiesel will also translate to an additional P11.5 billion in savings,” Diaz said.

Stakeholders in the coconut industry have been urging the government to increase the biodiesel blend to 5 percent to help the coconut industry, since the price of coconut oil in the world market is weak.

The Pambansang Koalisyon ng Manggagawa at Magsasaka sa Niugan president Efren Villasenor earlier said that the Energy department should immediately act on the petition of the Philippine Coconut Authority (PCA) and the coconut industry to adjust the biodiesel blend. The PCA is an attached agency of the DA.

Villasenor said that by adjusting the blend, the government will be helping the over three million coconut farmers in the country, since this measure will surely increase demand for copra.

The coalition is the largest federation of coconut farmer cooperatives in the country, whose member-organizations are mostly based in Mindanao and the Visayas.

The CIIF Oil Mills Group, which operates six plants that are engaged in the milling of copra and refining of coconut oil, is supporting the position of the coconut farmers.

Jesus Arranza, CIIF OMG president and chief executive, said that he had petitioned the Energy department as early as 2009 to adjust the blend.