Gov’t biofuel program may stall as supply tightens

Government regulators are reconsidering their position to fully implement the country’s E10 program, which mandates the 10-percent bioethanol blend with gasoline.

Zenaida Y. Monsada, director of the Oil Industry Management Bureau at the Department of Energy (DOE), said that the regulators are consulting with industry experts on the best way to proceed with the program.

Despite the E10 blending mandate, only about 20 percent of bioethanol supply comes from local production while the rest is imported. The trouble is that many source countries, such as Thailand with its own E20 mandate, have increased consumption of bioethanol.

“Imports may come from as far as the US,” Monsada said when asked where the Philippines could source bioethanol amid tightening supply.

On April 1, the so-called E10 gasoline was supposed to be distributed at fuel stations nationwide, on orders from the National Biofuels Board (NBB).

But the NBB will need to undertake a delicate balancing act as the E10 mandate has been much delayed as it is. Under the Biofuels Act of 2006 (Republic Act 9637), the ethanol blend should increase from 5 to 10 percent four years after the law took effect on Feb. 6, 2007.

The E10 blend should have been available for gasoline vehicles as early as 2011, but the tight supply situation prompted regulators to rethink their position that the E10 mandate should be strictly implemented nationwide.

“That’s precisely the subject of the consultations,” Monsada said via text message.

But she maintains that there is “close to 90 percent compliance” on the E10 mandate nationwide, with far-flung areas among those facing challenges in implementation.

The DOE is the lead agency in the National Biofuels Board. The departments of Agriculture, Science, Trade, Finance, and Labor are also represented in the board, which monitors the supply situation for bioethanol and biodiesel, as well as the compliance of service stations on mandated blends.

Bioethanol, or ethanol fuel, is a light alcohol substitute for gasoline. Bioethanol is produced by fermenting sugar from sugarcane or starch from such materials as corn, cassava and nipa.