The Department of Energy (DOE) has not approved the proposal of the Federation of Philippine Industries (FPI) to use palm oil in the country’s fuel mix.
The DOE said the proposal requires a thorough technical study and would entail the development of standard specifications for biodiesel from palm oil.
The DOE said the FPI recommended exporting coconut oil so that local farmers could benefit from its current high price in the world market and use the cheaper palm oil as an alternative to biodiesel production.
It added the Biofuels Act of 2006 mandates only locally-sourced biofuel components shall be used in the biodiesel-blend mandate.
The group’s proposal will be elevated to the National Biofuel Board through its biodiesel committee for a comprehensive evaluation and recommendation comprised of representatives from the DOE, Philippine Coconut Authority (PCA), Department of Science and Technology, Department of Labor and Employment and the Department of Trade and Industry.
FPI said the use of palm oil instead of coconut oil in the diesel mix will benefit motorists with lower diesel prices as palm oil is cheaper by around $300 to $500 per ton than coconut oil in the world market.
Based on data from the PCA, average price of copra as of November 19 for millgate was at P46.51 per kilogram (kg), almost 21 percent higher than last year’s P26.27 per kg while for farmgate, average price reached P36.70 per kg, up by almost 19 percent from 2020’s P18.36 per kg.
According to data from the Philippine Statistics Authority, as of 2019, the country can only produce 499,310 metric tons of palm oil compared to the higher production of coconut oil in the country which hit almost 1.2 million MT for the same year.
The Malaysian Palm Oil Council said that as of 2019, the Philippines is the top importer of Malaysian palm oil in the Asean region at 1.3 million MT. Palm oil’s main use in the Philippines is for cooking purposes.
The Asian Institute of Petroleum Studies Inc. (AIPSI) said FPI’s proposal will go against the goal of the Biofuels Act to lessen the country’s dependence on imported fuel.
Rafael Diaz, managing director of AIPSI, said coco methyl ester (CME) for biodiesel is still better as its combustion reduces pollution and improves mileage compared to palm-biodiesel and petro-diesel.
At present, the country implements a 2 percent CME blend for all diesel sold at retail pumps in the country.
Under the current Philippine Energy Plan, biodiesel should contain at least 5 percent CME blend by 2020 but this is not implemented due to concerns on pricing and logistics. Jed Macapagal
