Gov’t to issue ethanol pricing system soon

The guidelines for the much-awaited pricing mechanism for ethanol may soon be signed, following the completion of a draft circular that is expected to provide a vital boost for the country’s ailing ethanol industry.

Rosemarie S. Gumera of the Sugar Regulatory Administration (SRA) said that a pricing mechanism would be included in the circular to be issued by the Department of Energy.

While she did not disclose details prior to the signing of the guidelines, Gumera explained that the National Biofuels Board would be tasked to publish a reference price for ethanol.

This means that while the pricing of local ethanol will depend on market forces, the reasonableness of these will be determined by the reference price.

Local ethanol producers have been asking the government to set a pricing mechanism that will reflect the true operating costs of the facilities.

These companies, led by the Ethanol Producers Association of the Philippines (EPAP), had said that a pricing index for ethanol would help boost investments in the sector and prevent current investors from pulling out.

According to the Bioethanol Roadmap, there are only nine remaining bioethanol investors from over 20 companies that had submitted project proposals in 2008 and 2009.