Ethanol producers reject suspension of Biofuels Law


The Ethanol Producers Association of the Philippines (EPAP) has opposed the proposed suspension of Republic Act 9367 or the Biofuels Act of 2006, which the Department of Energy (DOE) believes could help cushion the soaring fuel prices. 

EPAP chairman Gerardo Tee emphasized in a report by The Philippine Star that bioethanol helps reduce the price of gasoline, while taxes affect fuel prices. Pres. Rodrigo Duterte himself, however, shot down proposals to suspend the fuel excise tax.

The group has proposed to raise the blend of bioethanol to 15 or 20% from the current ten percent to help reduce gasoline prices and at the same time, generate more savings and avoid greenhouse gas emissions. 

While domestic ethanol is expensive, Tee said that producers import 300 million liters of ethanol to meet the local blending requirements, which lower gasoline prices. 

Currently, 50% of the E10 blend is being served by domestic ethanol, while the balance is fulfilled by imported ethanol. The International Energy Agency projected late last year that the Philippines would be among the world’s top biofuel importers by 2026.

EPAP executive director Queenie Rojo said that as of March 16, domestic ethanol is priced at Php64.33 per liter based on the Sugar Regulatory Administration’s (SRA) price index, while imported ethanol costs Php43.23/liter. 

Industry computation showed that E10 gasoline decreased the retail pump price by Php3.40/liter versus imported gasoline. 

Competition in the ethanol industry likewise pushes producers to provide discounts to their customers – specifically oil retailers – as against the SRA price index, which also helps lower domestic ethanol prices, according to George Chung, EVP and Chief Commercial Officer of Manny V. Pangilinan-led Roxas Holdings, Inc.

Energy Sec. Alfonso Cusi brought up the possible suspension of the Biofuels Law at a Cabinet meeting earlier this month to help reduce local oil prices should the crisis on global crude prices worsen.

Back in December 2021, the DOE suspended the law in provinces hit by Typhoon Odette, so that adequate fuel stocks would be delivered to the affected areas.