Insufficient ethanol production in the country has prompted the Department of Energy (DOE) to temporarily relax the 10-percent bioethanol-blend requirement in gasoline fuel.
“Ethanol-blend requirement…may be waived for premium plus-grade gasoline products [minimum 97 RON] temporarily during the period of deficiency in the locally produced bioethanol products opposite the demand,” Department Circular (DC) 2015-06-005, which amends DC 2011-02-0001, entitled “Mandatory Use of Biofuels Blend,” stated.
As such, oil companies that will sell non-E10 gasoline must first formally notify the Oil Industry Management Bureau. The notice should include specific locations wherein such non-E10 products are sold.
Further, oil firms are required to “clearly indicate, through proper labeling” of their dispenser units, “that the said gasoline is non-E10” to distinguish it from other premium plus-grade E10 products as a guide to motorists.
The Biofuels Act of 2006 requires the use of clean alternative fuels—such as ethanol mixed with gasoline—which is expected to save the country P35 billion in annual oil imports. This means that oil companies are mandated to sell unleaded, premium and special gasoline products with at least 10-percent ethanol blend.
However, the DOE noted that the local production of ethanol is no longer enough to keep up with demand.
“Nine years after the implementation of the Biofuels Act of 2006, locally produced bioethanol, as of end-2014, accounts for only 27 percent of the total domestic bioethanol requirement, or only 115 million liters,” the circular stated.
As such, oil firms resort to importation. The catch, however, is ethanol-blended gasoline is more expensive than imported ethanol. Therefore, oil firms have no choice but to source overseas to comply with the government’s E10 requirement for gasoline.
“To address this shortage and enable gasoline companies to comply with the 10-percent minimum biofuels-blend requirement, importation of this product was allowed to continue until now, notwithstanding the fact that importation of bioethanol products is allowed only within four years from effectivity of the Biofuels Act,” or up to 2013 only.