Ethanol producers plead with DOE not to reverse Biofuels Law

MANILA, Philippines - The country’s ethanol producers are urging the Department of Energy (DOE) to refrain from raising the idea of reversing the Biofuels Law.

“Reversing the Biofuels Law is not the answer to the ethanol supply gap,” Ethanol Producers Association of the Philippines (EPAP) executive director Tetchi Capellan said in response to a proposed amendment to scrap RA 9367, otherwise known as the Biofuels Act of 2006.

“This DOE move, if adopted, diminishes the energy independence and climate change mitigation agenda of the country.”

She emphasized that only the consistent and transparent implementation of the Biofuels Act will increase investments, build more ethanol plants, and supply bigger volumes of ethanol.

“Instead of wasting time on crafting amendments, EPAP suggests for DOE to strictly enforce the blending requirements and penalize the 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,” she said.

EPAP urged the DOE to provide incoming Energy Secretary Almendras the list of companies that failed to comply with the biofuels law.

“Disclosing violators is the first step to the full implementation of the biofuels law. Secretary Almendras needs to know the real score from both the supply and distribution side of ethanol so he can make an informed decision on the matter. He should not be misled,” Capellan said.

She said the government plays a critical role in building supply capacity. Brazil took 35 years to build its ethanol industry. With intense support from the state, the production of ethanol in Brazil reached significant levels, while attaining competitive costs. Today, as a result of painstaking public-private partnership, Brazil boasts of 85 percent displacement of fossil fuels in automotives.

“Local ethanol production, on the other hand, is in its infantile stage. But with strong support, the industry will grow, “the EPAP official said.

“But 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 for these ethanol plants?,” she noted.

Three ethanol plants are currently producing alternative fuels derived from sugar. These are San Carlos Bioenergy, Roxol Bioenergy and Leyte Agricultural. Three more companies are expected to come onstream by 2011: Green Futures Innovation in Isabela, Pampanga Biofuels in Floridablanca and Cavite Biofuels in Magallanes.