Taking a pitch on prospective reduction of dependence on imported fuels, the Department of Energy (DOE) has approved progressive increase in coco methyl ester (CME) blend for diesel products – starting at 3.0% by October this year from currently at 2.0%.

Additionally, the DOE has given go-signal on a ‘voluntary hike’ in bioethanol blend at 20% by volume to gasoline products within the same timeframe this year.

In a late afternoon statement to the media, the DOE indicated that the move “aims to decrease dependence on imported fuels, reduce greenhouse gas emissions, and bolster the local biodiesel and bioethanol sectors.”

For biodiesel, in particular, the blend will also escalate further to 4.0% by October 1, 2025; and 5.0% by October 1, 2026.

The DOE stipulated that the policy framework for the utilization of higher CME blend starting October this year is underpinned by DOE Department Circular No. 2024-05-0014 that was issued by Energy Secretary Raphael P.M. Lotilla this month.

The energy chief noted that “to ensure a smooth and timely transition to higher biofuel blend percentages, the downstream oil industry must maintain sufficient storage capacity, blending facilities, transport systems, and dedicated storage tanks and dispensing pumps.”

On the higher 20%  ethanol blend from currently at 10%, the energy department emphasized that the intent is “to reduce domestic pump prices.”

Nevertheless, based on past industry experiences, that has not always been the case because there were many instances that ethanol also triggered price increases at the pumps.

And due to shortage of local production, the oil companies are also being forced to import ethanol commodities, hence, that essentially negates the narrative of reducing dependence on imported fuels.

The DOE qualified that the upward adjustments in biofuel blends had been firmed up based on the recommendation of the inter-agency National Biofuels Board.

At this stage, there are no forthright pronouncements yet from the original equipment manufacturers (OEMs) how compatible the higher biofuel blends would be in the performance of vehicles that have been plying various thoroughfares in the country.

The DOE argued that “the increase in the CME blend is expected to create additional market for coconut farmers, biodiesel producers, and other stakeholders in the coconut industry.”

Just with the 1.0% hike in CME to be added with diesel products, it was specified that roughly 900 million additional nuts will be required as feedstock for the additional 100 million to 120 million liters needed by the industry.

The department is also claiming potential savings of P4.17 per liter, as reckoned on a 30,000-kilometer on-road test if the blend would already reach 5.0% - and that is based on 10% increase in mileage. (MMV)