Philippines: Sugar millers urged to invest more in power co-generation

Philippines: Sugar millers urged to invest more in power co-generation

The Sugar Regulatory Administration (SRA) is urging players in the industry
to invest more in power co-generation and production of bioethanol from
sugarcane amid volatile sugar prices in the world market.

SRA policy and planning manager Rosemarie Gumera said the agency is
strengthening its product diversification by encouraging stakeholders to
invest more in the manufacture of bioethanol.

Bioethanol is produced using molasses, a by-product of the sugar refining
process.

"We need more products from sugarcane that would benefit our farmers so that
in case of sudden drop in sugar prices, they would have a fallback
industry," Gumera told reporters.

Gumera said two additional bio-ethanol plants, Cavite Biofuels Producer and
Progreen Agricorp Inc. (former Emperador Distillery), would operate next
year with over 60 million liters of combined capacity.

Thus, the industry will bring total bio-ethanol production capacity of the
existing eight facilities to up to 340 million liters, which is around 50
percent of the mandatory requirement.

Last year, plants had only 282 million liters capacity versus the 522
million-liter demand, allowing oil companies to import much cheaper ethanol
compared to locally-produced.

Based on the Department of Energy's projection, bioethanol requirement for
2017 is around 570 million liters.

Gumera also countered statements of oil companies they should just be
allowed to import all ethanol requirement to decrease prices of gasoline
fuel and power.

"That's not the intention of the bioethanol program. The intention is to
develop the local industry and reduce the fossil fuel importation," Gumera
said.

The agency is upbeat that more investments will continue to pour in,
allowing more plants that can produce and supply the 100 percent mandated
requirement by 2020.

Gumera, however, emphasized the agency's priority is still sugar mills for
food consumption.

SRA also continues to review policies on price reference formula that could
neutralize and stabilize the prices of molasses.

Several companies in the Philippines such as the San Carlos Bioenergy Inc.
and Roxol Bioenergy Corp., both units of listed sugar miller Roxas Holdings
Inc. are already strong producers of bioethanol.

Increase in energy production would translate to lower electricity and fuel
cost, as well as added value to local farms.

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Link to Original Article:
http://www.philstar.com/business/2016/12/13/1652831/sugar-millers-urged-inve
st-more-power-co-generation

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com