10% ethanol blend starts August 6

August 03, 2011

10% ethanol blend starts August 6



THE Department of Energy (DOE) said fuel retailers would be required to market a higher ethanol blend in gasoline products starting August 6.


Undersecretary Jay Layug said the move follows consultations conducted with various oil companies.

“Definitely by August 6, the mandate will push through, subject to certain fuel grade exemptions,” he said.

The Biofuels Act of 2006 mandates a five percent blend of ethanol in gasoline products starting 2009. This blend should double by 2011.

Local manufacturers produce less than 80 million liters of the 220 million liter estimated demand for the five percent ethanol blend in gasoline products, forcing the DOE to suspend the implementation of the 10-percent blend since the start of this year.

The DOE also allowed certain fuel exemptions from the 10-percent blend, such as regular gasoline with a minimum research octane number of 81 but only for use by off-road engines such as farm machineries, threshers, irrigation pumps, power tillers and small motorized boats; regular gasoline RON of 87 but only for use by motorcycles; and premium plus gasoline with minimum RON of 97.

Oil companies were also required to blend 10-percent ethanol in their gasoline products by volume.

Starting February 6, 2012, gasoline distributed and sold in the country shall contain a minimum 10 percent blend of ethanol.

Ernst Wanten, Total (Philippines) Corp. president, said they are prepared to comply with the mandate, but warned that consumers should brace for a possible increase in fuel prices because of costlier imports.

“Ethanol, at the moment, is more expensive. So you should see an increase [in prices]. And there’s no choice because the margin don’t commit to absorb it,” he said.

The executive ascribed the higher ethanol prices to competition from food manufacturers since the alternative fuel is sourced from crops. In the Philippines, ethanol is sourced from sugarcane.