DOE told: Conduct study on increased biodiesel blend for cheaper fuel supply

By Butch Fernandez - October 23, 2019

https://businessmirror.com.ph/2019/10/23/doe-told-conduct-study-on-increased-biodiesel-blend-for-cheaper-fuel-supply/

Citing the need to absorb oversupply of the country’s copra industry, Sen. Sherwin T. Gatchalian prodded the Department of Energy (DOE) to conduct a thorough study of a proposal to increase biofuel content in diesel, widely used in public transport and cargo trucks.

Gatchalian, chairman of the Senate Committee on Energy, nudged Energy Secretary Alfonso G. Cusi to promptly convene the National Biofuels Board (NBB) to draw up a policy bolstering growth of local biodiesel production.

The senator made the suggestion as he presided over a finance subcommittee hearing tasked to review DOE’s proposed P2.3-billion budget for 2020.

For a start, he pointed out that both the DOE and NBB need to study first the long-term feedstock availability before rendering any decision on higher blend of coco methyl ester (CME) to diesel products, adding that “the bottom line is, let’s convene the Biofuels Board and let’s come up with an action plan. The last time you convened [the NBB] [was during] Q2 [second quarter] pero walang aksyon na lumabas.”

Gatchalian reminded DOE officials “these issues have been there for a long, long time already. Iyan ang plea ng mga farmers two years ago, hanggang ngayon, iyan pa rin ang plea ng mga farmers right now. We need to address these issues kasi nagmi-meeting pero walang aksyon.”

In turn, DOE officials assured that a technical working group is “already studying the feedstock and pricing problems” that continue to plague the biofuels industry.

According to DOE, the Department of Agriculture’s (DA) projected coconut harvest for this year to satisfy the proposed 5 percent biodiesel blend was 1.5 billion nuts.

At the same time, the DOE also took a swipe at the DA for its failure to come up with a clear intervention on increasing the number and quick replacement of harvested coconut trees in the country.

Still, DOE officials assured Gatchalian’s subcommittee hearing they had been “coordinating with the DA” on how they would be able to help them grow their coconut production.

But Gatchalian lamented he was “getting mixed signals” from DOE and DA officials. “Ang sinasabi ng DA, there’s supply at ang sabi nila ay ayaw lang ng DOE dahil tataas iyong presyo. But the DOE is saying walang supply,” the senator said, adding: “Again, I urge the department to convene the NBB and then come up with an action plan. Then we will also convene the oversight so that we can already push for reforms and push for actions.”

The senator, citing a study by his office, estimated that increasing the biofuel content in diesel from B2 to B5 may result in a 1.09-percent increase.

He pointed out that an ordinary jeepney driver, who consumes around 15 liters of diesel per day, might need to tighten his belt further since he will be expected to shell out an additional P250.76 per month if the blend is increased, an amount, Gatchalian said, could instead be used to buy a 5 to 6 kilograms of well-milled rice. Meanwhile, he added, data from the DOE show that for biodiesel, the annual capacity in 2017 was 574.9 million liters, but production was only at 39 percent capacity.