Ethanol makers oppose move to lift import ban

The country’s ethanol producers are opposing the recommendation of the Energy Department to lift the import ban on ethanol and reduce the blending mandate prescribed under the Biofuels Law.

“Reversing the Biofuels Law is not the answer to the ethanol supply gap,” Ethanol Producers Association of the Philippines executive director Tetchi Cruz-Capellan said in a statement.

Capellan responded to an earlier statement of Energy director Zenaida Monsada that the Biofuels Law might have to be amended.

The Energy Department may seek guidance from Congress on how to implement the 10-percent ethanol blend in all gasoline pumps starting 2011 amid the short supply of local ethanol.

Local companies can only produce 80 million liters this year against the demand of around 240 million liters.

Monsada suggested the lifting of the import ban on ethanol and reducing the 10-percent blending mandate under the law.

“What happens if the law is amended? If the import restrictions are lifted, without regard to existing producers, how will local business and foreign funders recover the billions invested to these ethanol plants?” the association said.

Three ethanol plants are producing alternative fuels derived from sugar. These are San Carlos Bio-energy, Roxol Bio-energy and Leyte Agricultural.

Three more companies are expected to come on-stream by 2011, namely Green Futures Innovation in Isabela, Pampanga Biofuels in Floridablanca and Cavite Biofuels in Magallanes.

“All these entities have foreign equity partners and creditors,” the group said, adding that lifting the import ban would weaken the energy independence and climate change mitigation agenda of the country.

“Only the consistent and transparent implementation of the Biofuels Act will increase investments, build more ethanol plants and supply bigger volumes of ethanol,” the group said.

The ethanol producers urged the department to strictly enforce the blending requirements and penalize violators.

“By doing this, we create a more favorable climate for investments and encourage foreign capital to build the infrastructure for clean fuel in the country,” the group said. –Alena Mae S. Flores, Manila Standard Today