Gatchalian to DOE: Study impact of increased biodiesel blend

Senator Win Gatchalian has urged the Department of Energy (DOE) to thoroughly study the proposal to increase biofuel content in diesel to help absorb oversupply in the country's copra industry.

During the recent hearing on the DOE's proposed ?2.3 billion budget for 2020, Gatchalian called on Energy Secretary Alfonso Cusi to immediately convene the National Biofuels Board (NBB) and come up with a policy that will bolster the growth of local biodiesel production.

Gatchalian, chair of the Senate Committee on Energy and Senate Committee on Finance Subcommittee E, pointed out that the DOE and NBB need to first study long-term feedstock availability before rendering any decision on higher blend of coco methyl ester (CME) to diesel products.

"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] is Q2, pero walang aksyon na lumabas," Gatchalian said.

"These issues have been there for a long, long time already. Iyan ang plead ng mga farmers two years ago, hanggang ngayon, iyan pa rin ang plead ng mga farmers right now. We need to address these issues kasi nagmi-meeting pero walang aksyon," he added.

In response to the subcommittee members' queries, the DOE reported 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% biodiesel blend was 1.5 billion nuts. 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.

Nevertheless, DOE assured the subcommittee that they had been coordinating with the DA on how they would be able to help them grow their coconut production.

Gatchalian, for his part, said that he was getting mixed signals from both DOE and DA.

"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 lawmaker pointed out.

"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," he stressed.

Citing the study that his office conducted, Gatchalian estimated that increasing the biofuel content in diesel from B2 to B5 may result in a 1.09% percent increase, equivalent to ? 0.56, in the per liter pump price of biodiesel.

Gatchalian 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 ?250.76 per month if the blend is increased; an amount Gatchalian said could instead be used to buy a five to six kilograms of well-milled rice.

Meanwhile, data from the DOE shows that for biodiesel, the annual capacity in 2017 was 574.9 million liters but production was only at 39% capacity.

Source: Senate of the Philippines