Senate sets aside biofuel blend bill over local producer concerns

THE PHILIPPINE Senate on Wednesday adjourned for a six-week break without taking up an urgent measure that would ease the importation of biofuel components, noting that many local producers may be affected by this move.

“Many of our colleagues want further discussion of the measure,” Senate Majority Leader Juan Miguel F. Zubiri told reporters after the chamber adjourned.

He added that local producers like coconut farmers, sugar farmers, ethanol producers, and biodiesel producers may be affected by the proposed liberalized importation measure.

“There was a lot of fear among our colleagues that they were really affected. They wanted a linger discussion on the floor, so we are not able to take it up in one day,” Mr. Zubiri said.

He added that the measure will be taken up once Congress resumes session on May 14.

Senator Sherwin T. Gatchalian said that the measure needs to be studied further, as more than 400,000 farmers and ethanol workers may be affected.

“We need to ensure that our farmers have protections and safeguards, and we should also study if the price of fuel will decrease,” he told reporters separately.

President Ferdinand R. Marcos, Jr. had earlier certified as urgent Senate Bill No. 1965 and House Bill No. 8469, which seek to amend Section 5 of Republic Act No. 9367 or the Biofuels Act of 2006, in a move to mitigate surging local fuel prices.

Under the Senate’s version, the President is granted powers to allow the importation of bioethanol and biodiesel once the price of blended gasoline or diesel is 5% higher than that of its pure counterpart regardless of the supply of locally produced biofuel components, and upon the recommendation of the Department of Energy and the National Biofuels Board.

The Senate bill also states that proceeds from tariff collections from imported biofuels will be allocated to social amelioration programs for farmers and workers in the domestic biofuels industry.

The program will be conducted through the Department of Social Welfare and Development, in consultation with the Department of Agriculture and other government agencies.

However, the House only allows for the temporary suspension of the mandatory biofuel blend requirement once blended fuel prices are at least 5% higher than its pure variant. It earlier approved its version on third and final reading.

Meanwhile, a senator on Wednesday filed a bill seeking to establish a national strategic petroleum reserve to cushion impacts of tensions in the Middle East where 90% of the country’s crude is sourced.

Under Senate Bill No. 1993, Senator Francis G. Escudero sought to create an oil reserve which can store supply for 90 to 180 days.

“Even temporary disruptions in the Strait of Hormuz have immediately sent fuel prices soaring in the Philippines, with cascading effects on transport, food logistics, and power generation,” Mr. Escudero said in a statement.

The bill is seeking an initial funding of P60 billion for the oil depot construction, also proposing for the Department of Energy (DoE) to be in charge of the reserve’s fuel inventory, construction, maintenance, and operations.

The bill also provided that the reserve may be utilized once the country’s fuel inventory declines by 20% in events of fuel supply disruption and 20% weekly average price hikes of Dubai Crude Oil.

Mr. Escudero proposed the municipality of Limay, Bataan to house the oil storage facility where the Petron refinery, the sole crude refinery in the country, is located.

The bill also features a Targeted Fuel Relief Program (TFRP) which may be tapped in cases of oil shock due to international price increase, calamities, and geopolitical tensions.

The TFRP aims to provide cash assistance and fuel vouchers for sectors directly affected by oil issues such as those in agriculture, transportation, micro and small enterprises operations, and other industries prescribed by the DoE.

Energy Secretary Sharon S. Garin said the country has enough fuel supply until the end of April.

Fuel prices in the Philippines have spiked due to tensions in the Middle East following the US-Israel and Iran conflict on Feb. 28.

The war, now in its third week, has increased gasoline prices by P12.90 to P16.60, diesel by P20.40 to P23.90, and kerosene by P6.90 to P8.90 per liter on March 17. — Adrian H. Halili and Kaela Patricia B. Gabriel