A Drive towards Use of Biofuels

The Federal Planning Gov. Minister, Julio De Vido, announced the effectiveness of a mandatory gasoil blend with a 5% biodiesel. According to De Vido, this percentage will continue increasing year after year until reaching a 20% of the blend in the next four years.

As stated by De Vido, the biodiesel incorporation will strengthen five thousand job positions and the country’s energy reserves will increase by 2%. Besides, the Minister explained that this blend will have a neutral effect on the gasoil price.

“For us this is good news. It is a very good thing for biofuel companies to have a foot in the domestic market”, Fernando Peláez, President of the Biofuels Argentine Chamber (“Carbio”), said.

As explained by Claudio Molina, Executive Director of the Biofuels and Hydrogen Argentine Association, 800,000 tons of biodiesel will be necessary to meet the mandatory 5% blend. This biodiesel may by supplied by producers having a tax credit, a permission granted by the Government to those who want to sell biofuels in the domestic market.

Currently there are nineteen companies having this tax credit. Ten out of them are small-&-medium size companies and have a tax credit equivalent to 100% of their installed capacity. The remainder belongs to CARBIO’s companies, such as Unitec Bio, owned by Eduardo Eurnekian; Ecofuel, by AGD and Vicentín and AG-Energy, by Viluco. Forty percent (40%) of the companies having tax credit are from Non-Pampas areas.
Biodiesel domestic tariff is fixed by the Government and today it amounts to $ 2.90 plus VAT a liter, ex-factory. At the international market, biodiesel quotes at 930 dollars /ton.
Molina says that the country -having an installed capacity to produce 2 million tons of biofuels- has become a solid actor in the latest years. Therefore, today Argentina is the main biodiesel exporting country and the fifth world producer.