Ethanol Mandates and Government Policies Around the World

Previous posts  on my Advanced Biotechnology for Biofuels blog and on Biofuel Policy Watch have described current United States policy allowing ethanol to be blended into gasoline at up to a 15% volume ratio. A number of other countries and regions around the world have government policies which mandate or allow the use of biofuels, including ethanol, in motor vehicle fuels. The following is a summary of policies relating to ethanol in several countries and regions, including those having the largest markets for ethanol. Much of the information here has been derived from Biofuels Digest’s annual survey of international biofuels mandates and related national policies. The 2012  report can be accessed here and an earlier report, from July 2011, can be accessed here.  Additional information was obtained from a report on biofuels issued in 2011 by the International Energy Agency. There are some inconsistencies between these sources and other news reports, but I believe the information presented here is accurate. I have summarized this information in a table at the end of this blog entry.

Please note that this blog entry does not discuss mandates and targets for biodiesel; I may summarize those in a future Biofuel Policy Watch post, but for now, please refer to the Biofuels Digest and IEA reports for information about biodiesel policies outside the U.S. Also, the discussion below distinguishes between government “mandates”, which are legally-required minimum concentrations of ethanol in gasoline, from “targets” or “limits”, which represent the maximum allowed concentration of ethanol in gasoline. Finally, I have used the familiar abbreviations for ethanol/gasoline blends which are designated by the letter “E” followed by the allowed percentage of ethanol, such as “E15” for fuels containing 15% ethanol.

Brazil has the longest-standing national program to promote the use of ethanol in motor vehicle fuel. This national program, which dates back to the 1970s, not only mandated ethanol use in automotive fuel, but also provided for the infrastructure needed to support such use, including incentives for producing ethanol-powered cars and support for upgrading of gasoline stations to accommodate ethanol use. Until recently, Brazilian law mandated that gasoline have a minimum ethanol content of 25%, but this was reduced to 18-20% in 2010 in response to economic pressures. There were repeated reports in the latter half of 2012 that Brazil intends to go back to a 25% minimum blend. In October 2012, Brazil’s Ministry of Mines and Energy announced this intention, subject to government approval. This was again reported in December 2012, with an unnamed government official stating that this would take place in May 2013 in the expectation of a record sugarcane crop in 2013.

European Union.  As discussed in previous posts in Advanced Biotechnology for Biofuels and in Biofuel Policy Watch, the EU maintains two complementary pieces of legislation relating to renewable fuels: the Renewable Energy Directive (RED) and the Fuel Quality Directive (FQD). Together, these directives establish targets for the adoption of renewable fuels in EU member states by 2020. Transportation fuels are one category of fuels covered by these directives, and the targeted goals cover all renewable fuels – that is, they are not limited to ethanol. The FQD is relevant to the present discussion in that it establishes a limit of 10% for ethanol blending within EU member states, which are obligated to adopt national laws in conformance with the requirements of the directive.

Canada currently mandates 5% ethanol on a federal level, a policy in place since December 15, 2010. In addition, many provinces have equivalent or higher provincial mandates, including a 5 percent renewable content mandate in Ontario, 7.5 percent in Saskatchewan, and 8.5 percent in Manitoba.

Australia does not appear to have a national ethanol mandate (i.e. there are no minimum ethanol levels) and ethanol content in gasoline is limited to 10%, but there are applicable laws in certain Australian states. The state of New South Wales has a 4% blending mandate, although at one point it was contemplated that this would be raised to 6%. The state of Queensland was to have adopted a 5% mandate, scheduled to take effect in 2010 or 2011, but this has been put on hold due to interest group opposition.

Among other countries mentioned in the Biofuels Digest report, Argentina has an E5 mandate, Mexico has an E2 mandate in Guadalajara, which was expected to expand to Mexico City and Monterrey in 2012, Paraguay has an E24 mandate, Jamaica an E10 mandate, with several other Western Hemisphere countries also having ethanol mandates. China is reported to be moving towards a 10% biofuels mandate by 2020, India requires E5 and intends to move to E10 once sufficient domestic production capacity is in place, and the Philippines has adopted an E10 mandate.

It has been reported that South Africa has recently instituted a 2% ethanol blending mandate, which has led to concern over possible food price increases. However, the 2012 Biofuels Digest summary reports that the country has a 10% ethanol mandate, although the reason for this discrepancy is not clear.

The government of India has approved a mandate for 5% blending of ethanol in gasoline, but its implementation appears to be delayed due to a dispute over the pricing of sugarcane-derived ethanol (more recent coverage can be found here and here).  Meanwhile, the Indian State of Maharashtra has approved the blending of ethanol in gasoline up to 10%, effective March 1, 2013, making it the only state in the country allowing blends greater than 5%.

The Philippines, which currently has an E10 mandate, is expecting to achieve ethanol blending of 20% by 2020.

Vietnam has an E5 mandate, but although E5 is cheaper than 92 octane gasoline, demand has been low. The low demand for ethanol has led to a huge price drop for cassava, the main domestic feedstock for ethanol.

The Government of Zimbabwe has agreed to adopt a policy of mandatory blending of ethanol into gasoline, starting with a 5% blend and followed by increases to 10% and 20% over time. This has reportedly allowed a major commercial ethanol facility in the country to resume operations after it had been shut down to protest the lack of government policy towards ethanol

International Ethanol Policies (source: Biofuels Digest 11/22/12 and International Energy Association Report).

Country Mandate Target/Limit
Angola 10%  
Argentina 5%  
Australia 4% in New South Wales 10%
Brazil 18-20%, may increase to 25%  
Canada 5% (four provinces have higher mandates)  
Chile   5%
China Nine provinces have 10% mandate  
Colombia 8%, may increase to 10%  
Costa Rica 7%  
Ethiopia 5%  
Fiji   10% voluntary blend
India 5%, may rise to 10%  
Indonesia 3%  
Jamaica 10%  
Kenya 10% in the country’s third largest city  
Malawi 10%  
Mexico 2% in Guadalajara, to expand to include Mexico City and Monterrey  
Mozambique 10%  
Nigeria   10%
Panama 2% beginning 2013, rising in subsequent years  
Paraguay 24%  
Peru 7.8%  
Philippines 10%  
South Africa 10% (also reported as 2%)  
Sudan 5%  
Taiwan none, considering 3% mandate  
Uruguay none, 5% mandate expected by 2015  
Vietnam 5%  
Zimbabwe none, but a 10% mandate has been proposed  

D. Glass Associates, Inc. is a consulting company specializing in government and regulatory support for renewable fuels and industrial biotechnology. David Glass, Ph.D. is a veteran of over thirty years in the biotechnology industry, with expertise in industrial biotechnology regulatory affairs, U.S. and international renewable fuels regulation, patents, technology licensing, and market and technology assessments. Dr. Glass also serves as director of regulatory affairs for Joule Unlimited Technologies, Inc. More information on D. Glass Associates’ regulatory affairs consulting capabilities, and copies of some of Dr. Glass’s prior presentations on biofuels and biotechnology regulation,  are available at www.slideshare.net/djglass99 and  at www.dglassassociates.com. The views expressed in this blog are those of Dr. Glass and D. Glass Associates and do not represent the views of Joule Unlimited Technologies, Inc. or any other organization with which Dr. Glass is affiliated.

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