DOE taps UP for independent studies on biodiesel roadmap

MANILA, Philippines – The Department of Energy (DOE) is undertaking two studies on the implementation of a new roadmap for biodiesel to balance its benefits to coconut farmers and impact to consumers.

Outgoing DOE Secretary Zenaida Monsada said the agency has engaged another party to do research on biodiesel and its impact on fuel prices.

This study, which would be done by the University of the Philippines (UP) School of Economics, would complement the other study also being undertaken by UP, she said.

 “We have two studies ongoing right now. One is being done by a University of the Philippines-Los Banos (UPLB) professor and the other by UP School of Economics,” Monsada said.

The DOE chief said the two studies aim to determine if the farmers will benefit according to the objectives of the Biofuels Law while not burdening the general public.

 “One of the reasons to increase the biodiesel blend is to improve the quality of life in the countryside, to help the farmer… But in helping the coconut farmers with biodiesel, we may see a shift in burden to consumers in the form of higher fares as a result of the vicious cycle of price hikes,” Monsada said.

Earlier, the DOE engaged UPLB economics professor U-Primo Rodriguez to determine the impact of biodiesel on coconut farmers.

Monsada said the UPLB professor has an established model that will ascertain benefits of a higher blend in biodiesel “down to the farmer level.”

The Biofuels Act of 2006 mandates the amount of coconut oil for fuel to be blended with diesel may be increased taking into account such considerations as domestic supply and availability of locally sourced biodiesel.

From the two percent blend since 2009, the biodiesel blend was supposed to be increased to five percent in 2015 then raised to 10 percent and 20 percent by 2020 and 2030, respectively.

The biodiesel blend is still at two percent due to coconut supply issues.

In February 2015, the National Biofuels Board (NBB) commissioned UPLB to do further study on the impact of the higher blended biodiesel on the coconut industry to ensure farmers would benefit from the five percent blended biodiesel implementation.

The NBB is composed of representatives of the energy, agriculture, agrarian reform, science, labor and environment departments, the Philippine Coconut Authority and the Sugar Regulatory Administration.