Minister issues new regulation on biofuel price
Monday, March 2 2015 - 03:33 PM WIB
The ministry said in a statement following the sharp decrease in the Means of Platts Singapore (MOPS) for gas oil since last October, there is now a bigger gap between the economic price of diesel oil and that of biofuel.
To address the issue, the ministry has thus issued the MEMR Regulaton No. 9726K/12/MEM/2015 on Market Index Price of Biofuel Blended with Certain Types of Oil Fuel and Particularly-Assigned Oil Fuels.
Highlights of the new regulation which is effective March 1, are as follows:
1. Market index price of biodiesel mixed with certain types of oil fuels is determined on the basis of the Benchmark Export Price of crude palm oil (CPO) issued by the Ministry of Trade for the previous one month period, plus a CPO-to-Biodiesel conversion premium amounting to US$188 per metric ton with a conversion factor of 870 kg/cubic meters
2. Market Index Price for bioethanol mixed with particularly-assigned oil fuels is determined based on the average Argus Publication Price for ethanol FOB Thailand for the previous one month plus 14 percent of the local production weighted index with a conversion factor of 788 kg/cubic meters.
3. The Market Index Price of biofuel will be determined each month and will be evaluated every six months at the latest by the Directorate General of New Renewable Energy and Energy Conservation (EBTKE).
The ministry also said the volume of biodiesel mixed with oil fuels in 2014 reached 1.16 million kiloliters, up by 69.67 percent from the previous year.
The issuance of the new regulation is expected to maintain a good climate for investment in biofuel, particularly biodiesel, in anticipation of the target to implement a mandatory blending of 20 percent biodiesel in oil fuels in 2016.
Editing by Johannes Simbolon