DOE mulls scrapping of biofuels mandate

Having been apprised by industry players that this could yield bigger cost reduction to consumer-motorists, the Department of Energy (DOE) said it will be studying the propounded scrapping of the biofuels mandate to fuel products.

Energy Undersecretary Felix William B. Fuentebella said “we will have to study the legal implications of it. We’ll have to assess because that might need legislative action.”

He emphasized that the department will also be recalculating the estimated cost reduction at the petroleum pumps – just in case policy suspension is warranted.

Based on the numbers crunched by the Independent Philippine Petroleum Companies Association, the extent of discount that motorists may enjoy could reach as much as 11.80 to 12.00 per liter.

The Biofuels Law prescribes blending of coco methyl ester or biodiesel to diesel products; and ethanol to gasoline. Current blends are at 2.0-percent by volume for diesel and 10-percent for gasoline.

Discarding biofuels blend in petroleum products had been the counter-offer put forward by the oil companies, instead of them allowing the industry to regress to lower quality Euro-2 diesel.

Oil firms opined that consumer savings will definitely be heftier with the biofuels ditch; compared to the 10.28 to 10.30 per liter cost reduction estimated in the sale of Euro-2 fuel products.

The country’s experiment with biofuels had not been much of a success – especially on the ethanol sphere because the oil industry relied more on importation due to scant domestic sources.

With that as a backdrop, the overarching goal of supposedly creating valueadded opportunities for Filipino farmers had not also been achieved as targeted – and the policy has in fact been stalled in the “food versus fuel” predicament.

In the long-term Biofuels Roadmap cast by the DoE, the intent is to maintain current biodiesel blend at 2.0-percent; and ethanol blend at 10-percent until year 2019.