Business Options; Bio Fuels -- What Is Needed?

Article excerpt

Byline: Arsenio J. Vistro

The Bio Fuels Act of 2006 (Republic Act 9367) mandates the blending of Bio Fuels with Diesel and Gasoline Fuels for Motor Vehicles. This is the first time that the use of ALTERNATIVE FUELS is mandated; in fact even the date of first use of alternative fuels is specified.

For Gasoline engines it is required that: (a) 2 years from the effectivity of the Law a minimum of 5 percent Ethanol should be mixed, and (b) 4 years from the effectivity of the Law a minimum of 10 percent should be mixed. For Diesel engines the Law requires that: (a) a minimum of 1 percent is required to be mixed 3 months from the effectivity of the Law, and (b) a minimum of 2 percent is required 2 years after effectivity of the Law.

The use of Bio Fuels has many advantages - not just the price but other benefits that would be enjoyed by the entire human race around the world -- such as less pollution. For our country increase/expansion in agricultural activities and income would surely take place that will benefit our farmers and their families. It might even happen that the present "exodus" of the unemployed in the countryside to the cities and urban centers where jobs are abundant may suddenly REVERSE - city folks will then begin migrating to the farms where plenty and more lucrative jobs would then be plentiful.

But all of these will materialize only if CLOSE COORDINATION is maintained among all those who will be involved in one way or another in the implementation of the Bio Fuels Act.

For example, let us examine the materials that will be used to manufacture the Bio Fuels. For Ethanol this will use sugar cane, sweet sorghum and others. Industries that depend on sugar for their inputs would naturally want that their supply should be maintained or even increased. Any volume to be used for Bio Fuel will be "CUT" from the volume available for other uses. This situation might result in increase in price of sugar to the point that the price of the Bio Fuel to be produced would be higher than the price of fossil fuel.

For coco methyl ester (CME) or Bio Diesel (an additive to Diesel Fuel) using coconuts as the raw material, it will be competing with the requirements of the VCO (Virgin Coconut Oil) which the country has been trying to promote world wide as an export product. We may import coconuts from other countries like Indonesia, but for what price? In other words the sources of raw materials for the production of Bio Fuels should be properly coordinated by all users of such material.

The other problem is the availability of the Manufacturing Facility to produce these alternative fuels. …