The Department of Energy (DOE) on Thursday clarified that it has not approved the proposal of the Federation of Philippine Industries (FPI) to include palm oil in the country’s fuel mix.
This after the FPI recommended the use of cheaper palm oil as feedstock for a lower biodiesel price, and asked that the Philippine National Standards be prepared to accommodate palm oil for such fuel use.
The DOE stressed there is a need for the conduct of a thorough technical study, particularly on the development of standard specifications for biodiesel from palm oil. The agency also pointed out that under Republic Act 9367 or the Biofuels Act of 2006, only locally sourced biofuel components should be used in the biodiesel-blend mandate.
However, the agency, assured that FPI’s suggestions would be submitted to the National Biofuel Board, (NBB) through its Biodiesel Committee (NBB-BDC), for a comprehensive evaluation and recommendation. The NBB-BDC is composed of the DOE, Philippine Coconut Authority, Department of Science and Technology, Department of Labor and Employment, and the Department of Trade and Industry.
Also, the DOE said it still needs to validate the figures presented by the FPI, specifically the Rotterdam price comparison of crude palm oil (CPO) and crude coconut oil (CNO).
The FPI has committed to provide pertinent data to support its proposal, such as the latest historical price of CPO and CNO in the world market, as well as the actual production of CPO and CNO in the Philippines, including exported CNO volume and imported CPO volume.
FPI, in a letter to the DOE last October, recommended exporting coconut oil so that local farmers could reap the corresponding benefits of its current high price in the world market. They, likewise, proposed for the country to use the cheaper palm oil as an alternative for biodiesel production.
Meanwhile, the Asian Institute of Petroleum Studies Inc. (AIPSI) commented that the spirit of the Biofuels Act is to lessen the Philippines’s dependence on imported fuel. Therefore, if palm oil is used as an alternative for biodiesel production, “it goes against the intent of the law because we substitute our domestic coconut oil with imported palm oil.”
“What the article missed to say is that CME or coco-biodiesel is a much better quality fuel than palm-biodiesel and petro-diesel. Combustion of CME reduces pollution and improves mileage,” said AIPSI Managing Director Rafael Diaz when sought for comment.