Process Management

News last update:6 Aug 2012

Argentina stimulates ethanol use in fuel

The Argentine government will require gasoline to contain a 5% mix of ethanol beginning in 2010.

Planning Minister Julio De Vido, announcing the measure, said: "This measure will lead to greater production of energy, a more diverse energy supply network, and a larger supply of fuel."

A 2007 law already required Argentines to use a 5% fuel mix of either biodiesel or ethanol starting in 2010. De Vido's announcement shifts the law in favour of sugar-based ethanol.

De Vido said the move is part of a national biofuels promotion program aimed at boosting the production and use of clean and renewable energy.

The planning minister said as part of this program companies will invest more than $500 million in northern sugar-producing provinces.

De Vido said Argentina will initially produce 300 million litres of ethanol annually but that will rise to more than 600 million a year.

This will be more than enough to surpass new demand for the fuel, De Vido said. "The use of ethanol will be obligatory," he said, adding that the percentage mix requirement could rise in line with production.

De Vido said a new pricing system "will guarantee sugar producers a permanent and reasonable profit." He also said tax incentives will be granted to companies that invest in the sector.

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