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Business and Society
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Reducing dependence on oil imports

By Bernardo M. Villegas

BRIC stands for the four largest countries that will account for the most dramatic increase in consumer demand for all goods and services imaginable in the next twenty years. Brazil, Russia, India and China are the most populous nations in the world that will see hundreds of millions transitioning from low-income to middle-income status, inducing high single-digit or double-digit growth rates in the demand for basic goods, including energy products.

Russia has petroleum and will manage to survive high oil prices. China and India will account for an increasing share of oil imports from the Middle East and other oil producers. Thanks to its being a pioneer in the use of ethanol alcogas, Brazil will be the least dependent on petroleum as a source of energy among the four.

As a small player in the global market for goods and services, what is the future of the Philippines as regards energy supply? I am glad to share with my readers the views of Mr. Andrei L. Postrado, a freshman at the Ateneo de Manila University, who emailed me a reaction to a column on the Bio Ethanol Bill filed by Congressman Juan Miguel Zubiri in the House of Representatives. It is heartening to receive a very well thought out paper on the advantages of ethanol alcogas and coco biodiesel from a very young concerned citizen. The likes of Mr. Postrado augur well for the quality of our future leaders. The rest of this column will contain an edited version of the text of his email.

The Clean Air Act was signed a few years ago with much publicity about the use of unleaded gasoline. And yet everyday, in my commute from Parañaque to Quezon City, I see so many vehicles spewing black smoke so thick that visibility becomes almost zero. True, I sometimes see MMDA anti-smoke belching teams going after these but the guilty ones apparently never learn their lessons.

Of late, we had been experiencing unabated increases in the cost of gasoline and diesel fuel for our transport vehicles, mainly due to the continued increase in price of crude petroleum in the world market from just before the American invasion of Iraq in March 2003 to today’s level of per barrel.

These two problems of our country today, severe pollution from transport vehicles’ smoke emission and escalating dollar requirement to buy our fuel, luckily can be alleviated to a great extent if we can only effect wide use of "ethanol alcogas" and "coco biodiesel."

Ethanol alcogas or plain "alcogas" is a blend of gasoline and 5 to 10% anhydrous ethanol (technically up to 25 percent is feasible). Alcogas is said to provide as good as if not better efficiency than pure gasoline owing to the high Octane Rating of ethanol. Toxic combustion by-products are also minimized. Ethanol can be produced locally thru fermentation of sugarcane, molasses, corn, cassava or other root crops. A newly launched 10% alcogas blend, utilizing "imported" ethanol will be cheaper by 65 to 71 centavos over pure gasoline. Bigger price reduction surely can be attained if ethanol can be produced locally. The Department of Energy estimated annual foreign exchange savings of about 4 million if the Bio Ethanol Bill is enacted and a 10% alcogas blend is mandated within four years. Given proper support, the setting up of large ethanol production facilities should be no problem to Filipino capitalists owing to the great number of sugar centrals we have and our extensive experience in sugarcane planting.

Coco Biodiesel, on the other hand, involves the blending of indigenous coconut oil with additive i.e. Coco Methyl Ester (CME) to diesel fuel, resulting in a much cleaner exhaust gases with no effect on efficiency. DoE estimated savings of around P6 billion per annum if only 5% of total oil importation is displaced by biodiesel.

It follows that if these products will be patronized by the Filipino motorists, all shall obtain benefits, aside from CLEANER AIR. Our sources of fuel will be more secure; there will be significant foreign exchange savings; prices of sugar and coconut can be stabilized; and more employment can be generated in the rural areas.

Government therefore has to lay down and implement a clear, consistent long term program to encourage and support private corporations to set up production and agricultural facilities for alcogas and biodiesel, and at the same time pursue a massive information campaign thru media to educate the Filipinos on the many benefits from use of these blended bio-fuels. We can perhaps learn from our neighboring Asian country, Thailand, which has extensive natural gas deposits and yet has targeted a 10% ethanol alcogas mix by year 2008.

It is refreshing to see the activism of young people like Mr. Postrado channeled through very constructive ideas to create income and employment opportunities all over the Philippines. Those who want to chat with Mr. Postrado can email him at _ HYPERLINK mailto:postradoft@yahoo.com postradoft@yahoo.com_. For comments, my email is HYPERLINK mailto:bvillegas@uap.edu.ph bvillegas@uap.edu.ph_.

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