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Hotel Salak The Hotel Salak The

Heritage, Bogor, Heritage, Bogor,

IndonesiaIndonesia

November 6November 6--7, 20127, 2012

Biofuels Act Biofuels Act of 2006of 2006

Renewable Renewable Energy Act of Energy Act of

20082008

Guidelines Guidelines Governing Governing

Biofuel Biofuel Feedstocks Feedstocks ProductionProduction

All Liquid fuels for

motors & engines

sold in the Philippines shall contain locally-

sourced biofuels

components;

Provides social

amelioration benefits

to biofuel workers

Ma

nd

ate

Mandates the development

of renewable energy which

includes the utilization of biomass energy. It provides

additional fiscal incentives

to bioenergy projects &

activities such as income tax

holiday, duty-free

importation of machine-ry &

equipment, etc. covering

biofuel producers, farmers &

local fabricators

Ince

nti

ve

s

Regulates the use of

agricultural crops and

lands for biofuel production; cereals such

as rice, corn, wheat, etc.

cannot be used as

feedstock for biofuels;

irrigated lands with

government funding

cannot be utilized as

feedstock production

areas for biofuels

Fe

ed

sto

cks

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Year 2008 2009 2010 2011 2012*

% Blend - 5% 5% 10% ** 10%

PRODUCTION CAPACITY (Million Liters) 9.0 39.0 49.0 49.0 79.0

SUPPLY

Production (Molasses & Sugarcane) 1.0 23.3 10.2 4.1 31.0

Imports 12.5 64.2 140.4 218.8 239.1

Total 13.5 87.5 150.6 222.9 270.1

DEMAND - 185.1 187.0 234.6 319.7

ACTUAL ETHANOL Based on E10 SOLD 7.0 82.2 178.3 196.2 279.0

COMPLIANCE TO MANDATE (Oil Companies) - 44.4 95.3 83.6 87.3

* Projections only

**Implemented in Aug 2011 with exemptions; full implementation in 2012

NOTE: A policy for the mandatory utilization of locally-produced bioethanol through

allocation to oil companies prior to importation is implemented together with the

setting up of a bioethanol reference price

A Study Conducted by Dr. Akihiro A Study Conducted by Dr. Akihiro WatabeWatabe of Kanagawa University, Japanof Kanagawa University, Japan

(A Project of the Institute of Energy Economics Japan (IEEJ)(A Project of the Institute of Energy Economics Japan (IEEJ)

In Partnership With The National Biofuel Board and Sugar Regulatory Administration)In Partnership With The National Biofuel Board and Sugar Regulatory Administration)

A Study Conducted by Dr. Akihiro A Study Conducted by Dr. Akihiro WatabeWatabe of Kanagawa University, Japanof Kanagawa University, Japan

(A Project of the Institute of Energy Economics Japan (IEEJ)(A Project of the Institute of Energy Economics Japan (IEEJ)

In Partnership With The National Biofuel Board and Sugar Regulatory Administration)In Partnership With The National Biofuel Board and Sugar Regulatory Administration)

• The results of the analysis based on the distillery model using an existing sugarcane plantation as source of feedstock showed that the Biofuels Act of 2006 will benefit the environment; i.e., there is reduction in GHG emission.

• The study provides a partial analysis only since bioethanol from molasses and newly constructed distilleries using new lands not previously planted with sugarcane must be also considered in future analysis.

• The total economic impact of

biofuel supply in the Philippine

economy is evaluated based on

the magnitude of the value

added generated by biofuels

supply to GDP.

• The higher the blending rate,

the higher is the total value

added to the Philippine

economy, and biofuel supply

contributes about 6-12% of GDP

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Producers (2012) Capacity

(Million Liters)

Sales

(Million Liters)

% Blend

1. Chemrez Technologies, Inc. 75 2007 – 48.5 1.0%

2. Mt. Holly Coco Ind’l Co. Ltd. 50 2008 – 64.5 1.0%

3. Pure Essence Int’l, Inc. 60 2009 - 131 2.0%

4. Golden Asian Oil Int’l, Inc. 60 2010 – 124.5 2.0%

5. Bioenergy 8 Corp 30 2011 – 122.5 2.0%

6. Tantuco Enterprises 30 Coconut is the main feedstock for

biodiesel & the Philippines exported

around 75% of its coconut products

7. Phil. Biochem Prod., Inc. 12 The biodiesel producers are pushing for

an increase in blend to 5%; under

evaluation is the reliability of feedstock

supply and impact of CME biodiesel

price to the pump price of diesel.

8. Freyvonne Milling Services 15.6

9. JNJ Oleo Chemicals, Inc. 60

TOTAL 392.6

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Updates on Biomass EnergyUpdates on Biomass Energy

• In July 2012, the feed-in-tariff rate of biomass was approved at

P 6.63 per kw (15.8 US cents / kw)

• Philippine sugar mills are now assessing their current power generation

capacities for possible upgrading of their boilers and turbo generators

A. Socio-economic impacts

1.Additional investments of approximately 12 billion pesos (US$ 286 M) due to the

establishment of biofuels facilities

2.Additional employment opportunities in the rural communities; most felt in the

emergence of bioethanol facilities from agricultural crops

3.Alternative market for commodities derived from indigenous crops when there is

reduced demand in the international market for the commodities like sugar & coconut

oil.

B. Impact to the environment

1.Displacement of fossil fuels with cleaner biofuels although environmental data are

not well-monitored especially vehicle emissions reduction; However, based on the LCA

for bioethanol, there is a potential reduction in GHG emissions; No LCA is conducted

for biodiesel yet.

2.Utilization of biomass into power prevents the unnecessary burning of excess

bagasse, rice hulls and other farm trashes

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1. Passage of a National Land Use Policy to prevent the premature conversion of

agricultural lands into residential and commercial areas which resulted to the

shrinkage of agricultural lands.

1. Consolidation of lands and identification of potential areas for bioenergy

investments, especially for bioethanol crops.

1. Gathering of economic indicators and environmental data to assess the real

benefit of biofuels to the economy and the environment.

1.During the first two years of the implementation of the bioethanol mandate, oil

companies preferred to import bioethanol to comply with the mandate rather than

buying the locally-produced bioethanol since imported bioethanol is cheaper. In 2011,

bioethanol producers became hesitant to produce bioethanol and some investors

deferred their investments.

Upon the strict implementation of the policy on mandatory utilization of locally-

produced bioethanol and setting up of a bioethanol reference price, oil companies

were compelled to buy the local bioethanol first.

2.The farming sector and the government came to realize that productivity of

bioenergy crops such as sugarcane and coconut should be improved in order to be

competitive with the world market.

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Simultaneous edits on one single document.

No more waiting your turn or managing

multiple versions.

It’s about team work, and will get you there.

Consistent collaboration and stronger

linkages between Asian nations towards

a sustainable bioenergy development

Proposed Areas of Cooperation

Cooperation in terms of analyzing the impact of the Philippine

bioenergy policies and in the establishment of computerized

information centers for biofuel crop farmers

Website : www.sra.gov.ph

Email : marujazz@gmail.com

info@sra.gov.ph

Tel. No. : (632) 929-6137

(632) 455-0446