RP bioethanol producer suspends P8-B expansion projects

Volatile prices in the world market pushed one of the country’s producers of bioethanol—a type of alcohol blended with gasoline which reduces harmful vehicle emissions—to suspend its P8-billion projects. “We still have projects in the pipeline but they’re on hold now. For bioethanol, we don’t know how the price rolls. We cannot predict the international economic movement, and unless there are changes (in the world price), expansion projects will remain suspended," Bronzeoak Philippines Managing Director Jose Maria P. Zabaleta Jr. said. Zabaleta added the company’s partner in Brazil—the world’s second largest producer of bioethanol—is not too keen on expanding production in the country since price swings from the Brazilian to the world market have been evident in recent months. “Price volatility is our main problem. The Philippine bioethanol industry is still in its infancy. We cannot compete with global leaders. Oil companies prefer to import rather buy local bioethanol," he said. The company produces 30 to 35 million liters of bioethanol annually versus the 350-million-liter national requirement. Government approval on feed-in tariffs is expected in two months, Zabaleta said, only at which time the company’s three suspended projects in the country could be revived. Feed-in tariff is the premium paid by a utility to its consumers for excess power generated by alternative energy system. Feed-in tariffs are used by the government as incentive for consumers to adopt newer, cleaner, renewable energy sources. Bioethanol—which is processed from sugarcane or starch—is a renewable energy resource that produces little carbon monoxide and thus reduces harmful emissions from vehicles. Zabaleta also expressed concern that farmers might be discouraged to plant because of the current price downtrend. The government is banking on the product to reduce the country’s dependence on imported petroleum. Bronzeoak, through San Carlos Bionergy, Inc., is Petron Corp.’s supplier for its E10 Premium oil brand. Under the biofuels law, all gasoline sold in the country would contain five-percent bioethanol. -- Carmela Lapeña/Nikka Corsino/OMG, GMANews.TV