DOE to review impact of 5% biodiesel blend on gas prices

MANILA, Philippines - The Department of Energy (DOE) is reviewing how much gasoline prices would increase once the required biodiesel blend increases to five percent as mandated by the Biofuels Act of 2006.

Energy Secretary Carlos Jericho Petilla said the requirement of the law to increase the blend to five percent is still under review.

“If we increase it to five percent, we’re looking at the price impact. We’re still reviewing this now,” Petilla said.

The Department of Energy (DOE) was earlier looking at implementing the required higher blend this year instead of the original 2015 target, but local petroleum firms say they are not ready.

Energy officials said the country has enough supply of biodiesel, which would allow an early implementation of the higher blend ahead of the target.

The Biofuels Acts of 2006 requires a higher biodiesel blend of five percent from the current two percent.

Industry players such as Chemrez Technologies said the blending of cocobiodiesel into diesel would reduce the country’s dependence on imported oil, in accordance with the Philippine Energy Plan that aims to achieve energy independence within the next decade.

Furthermore, Chemrez said simply blending five percent coco biodiesel into diesel could save the Philippines an estimated P13 billion worth of imported crude oil every year.

Under the law, the amount of coconut oil for fuel to be blended with diesel may be increased, taking into account considerations such as domestic supply and availability of locally sourced biodiesel.

However, since 2009, biodiesel has been blended at two percent with diesel fuel.

The Energy department, for its part, has also been pushing for a higher blend but at the same time it is also studying the impact on local pump prices with the five percent biodiesel blend.