Government estimates nascent sector could create 55 000 jobs
State turns up heat on its draft biofuels strategy
April 4, 2007
By Justin Brown
Johannesburg - The government is set to finalise its biofuels strategy by June and to implement the policy during the second half of the year.
More than 200 submissions had been received from stakeholders regarding the draft biofuels strategy, Sandile Tyatya, the department of minerals and energy's chief director of clean energy, said yesterday at a conference organised by the Central Energy Fund that.
The strategy would be presented to cabinet in May.
The government has estimated that a nascent biofuels sector could create 55 000 jobs.
It had adopted an approach whereby it would consider a number of crops as inputs in the production of biofuels.
The state was considering maize, sugar cane, sugar beet, sorghum and wheat as possible feedstocks in the production of biofuels.
The key challenges the strategy would need to address were the costs of the technology to develop the biofuels and the production plants.
Another issue was the price of crops used to produce biofuels and the impact that would have on food prices, Tyatya said.
Grain SA's general manager, John Purchase, warned that the country was prone to occasional droughts as a result of the El Nino phenomenon as well as Indian Ocean warming.
The deputy director of industrial affairs at the SA Cane Growers Association, Adrian Wayne, said the increasing interest in bioethanol was driven by such climate change as well as the global reliance on fossil fuel reserves.
Wayne said a competitive biofuel industry required competitive production inputs, appropriate process technology, an economic production price, a viable market for the biofuel product and an effective value chain.
Louis Dreyfus Commodities' chief executive, Remi Burdairon, said biofuel was largely a by-product of feed production. For every ton of biofuel that came to the market, two to three tons of feed would be produced.
He warned that South Africa was a net importer of a number of proposed feedstocks for the production of biofuels.
Burdairon said biofuels subsidies in the US, Spain and Germany were much higher than locally, where biodiesel received a rebate of 40c a litre on the fuel levy.
Tyatya said there was a possibility that the government would increase the level of incentives for biofuels in the final biofuels strategy.
It is planned that by 2013 biofuels would constitute 4.5 percent of motor fuel sold, because this fuel would contain either an 8 percent ethanol blend or a 2 percent biodiesel blend.
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