The Philippine Star

President Arroyo led yesterday's opening of a new P650-million coco-biodiesel plant in Quezon City, which is expected to boost the country's energy independence agenda at a time when world crude oil prices continue to surge.

Chemrez's plant in Libis - the biggest and most modern coco-biodiesel facility in Asia - is expected to produce 60 million liters of coco-biodiesel per year.

In her speech, the President promoted the use of Chemrez's coco-biodiesel product, which is marketed under the brand name BioActiv. She said if used regularly, the fuel enhancer could guarantee a P1,000 savings on fuel consumption and vehicle maintenance per month.

"How does this reduce the cost of transport? By adding one liter of BioActiv fuel enhancer to every 100 liters of diesel we reduce the transportation cost per kilometer," she added.

Mrs. Arroyo lauded Chemrez for its contribution to make diesel-fueled vehicles become fuel-saving and environment friendly, for providing a source of livelihood for coconut farmers and for producing a Philippine export product to first world countries.

"I want to congratulate Chemrez because we are now exporting biodiesel to Japan and Germany, which have very high quality standards," Mrs. Arroyo said.

Aside from Japan and Germany, the President said the Americans, Australians and the Chinese have also expressed confidence in the local coco-biodiesel.

The company is also looking at other European markets like France, the Netherlands and Italy as potential market for Philippine coco-biodiesel.

Jun Lao, however, said that at this time they would concentrate first on the domestic market. "We are already positioning in other markets but at this time, we want to focus on the Philippine market," he said, adding that the expansion will come after the passage of the Biofuels Bill now pending in Congress, which will mandate a one percent blend of coco-biodiesel to diesel products.

The Philippines' annual diesel demand is about six billion liters. If every diesel-run vehicle in the country will use at least one percent blend of coco-biodiesel, diesel consumption will be reduced by 540 million liters per year.

Mrs. Arroyo said this will free our people from uncertainties of an energy supply heavily dependent on imported oil.

She noted that consumption of imported fuel products decreased by eight percent last year because of the alternative fuel program.

"What we want is that by 2010 we are already 60 percent self-sufficient in fuel and energy needs," she said.

Chemrez is one of the three coco-biodiesel manufacturers in the country accredited by the Department of Energy. With the additional 60 million liters of coco-biodiesel it will be producing per year, the country now produces a total of 110 million liters of coco-biodiesel per year. Of this, 25 million liters are being produced by Senbel and 10 million liters by RI Chemicals.

Energy Secretary Raphael Lotilla said the use of coco-biodiesel may be one of the country's sustainable and long-term solutions to rising oil prices.

Chemrez operations manager Jun Lao said the coconut industry would benefit approximately P2 billion in additional revenues per year from the sale of coconut oil. "This is the return benefit in the use of locally-sourced fuel in contrast to imported fuel," Lao said.

Mrs. Arroyo said she had allotted P1 billion for agriculture and the agrarian reform program to be able to develop one million hectares of land, which could include the development of the coconut industry.

During the inauguration of the Chemrez plant, the President was accompanied by Lotilla, Quezon City Mayor Feliciano Belmonte Jr. and several lawmakers whose provinces would supply coconut to the coco-biodiesel company.

Lotilla said apart from reducing actual cost of fuel, alternative transport fuels could also yield savings in terms of mileage efficiency.

According to Chemrez, coco-biodiesel enhances combustion performance for better mileage and restores fuel system and engine efficiency.

It is said that the inherent oxygen content of coco-biodiesel promotes better combustion in the engine which translates to an increase in mileage by as much as 10 percent.

Earlier tests by the US Department of Energy's National Renewable Energy Laboratory (NREL) revealed that coco-biodiesel consistently yielded comparable or even better results than conventional fuel.

Tests also showed that both diesel and coco-biodiesel fuels met existing Philippine National Standards for diesel fuel quality. In fact CME scored better in terms of cetane number, flash point, and sulfur content compared to diesel. This means that coco-biodiesel burns more completely, resulting in more power, better engine performance, longer mileage and lower emission for vehicles.

The President launched the coco-biodiesel program in April 2004 and issued an order mandating the use of one percent coco-biodiesel in all government diesel-fueled vehicles.

She also signed as urgent the Biofuels bill pending in Congress.

Meanwhile, despite rising fuel costs, prices of basic commodities could not rise beyond a few centavos, according to the Department of Trade and Industry (DTI).

Trade Undersecretary Zenaida Maglaya said the DTI and the private sector have conducted a "sensitivity analysis" or the effect of movements in fuel prices on consumer prices.

The result of the analysis showed that for every 50 centavos per liter increase in fuel prices, an increase of one to six centavos in the prices of processed food such as sardines, canned meat and instant noodles was monitored.

In the case of agricultural and poultry products such as pork, fish and chicken, the same amount of increase would only result in a price hike of one to four centavos per kilo, Maglaya said.

She added that the list of basic goods as determined by the DTI and the private sector has been published and distributed to the media for dissemination to the public. - Aurea Calica, Donnabelle Gatdula, Paolo Romero