IMPROVEMENTS IN CONVENTIONAL FUELS AND UPDATES ON ALTERNATIVE FUELS PROGRAM

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IMPROVEMENTS IN CONVENTIONAL FUELS AND UPDATES ON
ALTERNATIVE FUELS PROGRAM
A Presentation by ZENAIDA Y. MONSADA Director,
OIMB- Department of Energy
Partnership for Clean Air General Assembly
Asian Development
Bank 20 October
2005, Mandaluyong City
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2004 Energy/Power Mix
Power Mix
Energy Mix
Natgas
Hydro
Others
Hydro
22.6
15.3
32.1
5.6
Natgas
6.3
Coal
Geo
Geo
Coal
12.3
18.4
6.8
28.9
Source Department of Energy
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Fuels and Vehicle Emissions
VEHICLE
FUEL
EMISSION
DOE
DOTC / LTO / MMDA / DTI / DOST
DENR
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Fuel Quality Improvement
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CAA Requirements Fuel Specs
Unleaded Gasoline

• Aromatics 45 max Jan. 1, 2000
• Benzene 4 max Jan. 1, 2000
• AKI 87.5 min Jan. 1, 2001
• RVP 9 psi max Jan. 1, 2001
• Aromatics 35 max Jan. 1, 2003
• Benzene 2 max Jan. 1, 2003

Automotive Diesel
Sulfur 0.2 max Jan. 1, 2001 Cetane
No./Index 48 min Jan. 1, 2001
Sulfur 0.05 max Jan. 1,
2004
Industrial Diesel
Sulfur 0.3 max Jan. 1, 2001
Note 0.05 max effective Jan. 1, 2009, per PNS
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Fuel Quality Standards

• 1. CONVENTIONAL FUELS
• PNS 11312000 (ULG complying to CAA for 2000
  specs)
• PNS 202000 (Diesel complying to CAA for 2001
  specs)
• PNS 11312001 (Multigrade ULG complying 2001
  specs)
• PNS 11312002 (ULG complying to CAA 2003)
• PNS/DOE QS 0042003 (Diesel complying to CAA for
  2004 specs, and possible differentiation between
  tax-free and tax-paid)
• PNS/DOE QS 0012005 (ULG with sulfur level
  conforming to EURO II standard of 0.05 mass
  max.)
• DPNS/DOE QS 0072005 (Bunker Fuel)

Phase out lead in gasoline 9 mos. ahead of sked
MM Accelerated sulfur reduction to 0.05 S in ADO
2 mos. ahead of sked MM
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Fuel Quality Standards

• 2. ALTERNATIVE FUELS
• PNS 20202003 (B100 100 CME)
• - DOE CME Logistical Test Protocol
• PNS/DOE QS 0032003 (2-stroke Lubricating Oils,
  update of 1992)
• PNS/DOE QS 0052005 (Auto-LPG, update of 1990)
• DPNS/DOE QS 0072005 (Anhydrous Bioethanol Fuel)
• Drafting of standard for Jatropha

DEPARTMENT OF ENERGY
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ALTERNATIVE FUEL PROGRAM (Fuel
Ethanol Program)

• DPNS QS 0072005 Anhydrous Bioethanol Fuel
  Specification
• 1. Raw Materials
• Imported Ethanol 99 purity
• Local Ethanol
• Anhydrous
• Hydrous
• 2. Intermediate Products
• Fuel Ethanol
• Pre-blended gasoline
• Finished product offered at gas stations
• E-gasoline, E5 E10

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Facilities Quality Standards

• FACILITIES STANDARDS
• PNS/DOE Petroleum Products for Retail Outlets
  (promulgated by BPS Feb. 23, 2005)
• PNS/DOE FS 1-12005 Health, Safety and
  Environment
• PNS/DOE FS 1-22005 Underground Storage Tank
• PNS/DOE FS 1-32005 Piping System
• PNS/DOE FS 1-22005 Dispensing Pumps
• DPNS on LPG Refilling Plant (For promulgation 1Q
  2006)
• Drafting PNS for Storage Facilities
  
• Draft DC on Handling, Transport Distribution of
  LPG Cylinders

DEPARTMENT OF ENERGY
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DOE Role - Additives Registration

• Fuel Additives Registration
• Total Applications filed - 79
• Permanent Registration granted - 24
• Total Provisional Registration Issued - 31
• Applications Reviewed/Evaluated - 24
• (subject for further compliance)
• As of 15 October 2005

• Types of additives applied/registered
• Octane enhancer
• Lubricity/friction modifier
• Emission/smoke suppressant
• Fuel efficiency improver
• Detergent
• Deposit control
• Anti-valve seat recession and others

DEPARTMENT OF ENERGY
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Alternative Fuels Program
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ALTERNATIVE FUEL PROGRAM
(Coco-Biodiesel Program)
POLICY INITIATIVES

• MC No. 55 Directing all Departments, Bureau,
  Offices and Instrumentalities of the Government
  . to Incorporate the Use of 1 by volume CME in
  Their Diesel Requirements (Feb 9, 2004)
• DC No. 2004-04-003 Rules and Regulations
  Implementing MC 55 (March 29, 2004)
• Supreme Court M C No. 07-2004 Directing the
  Supreme Court, Court of Appeals, Sandiganbayan
  and the Court of Tax Appeals to Use 1 CME (June
  23, 2004)
• DC No. 2005-04-003 Promoting the Use of
  Coco-Biodiesel as an Alternative Clean Fuel
  (March 1, 2005)
• Alicia, Isabela Resolution No. 2004-009
  Requiring the Use of CME by All Motorists In
  support of the Clean Air Act (Feb 11, 2004)
• Baguio City Resolution No. 154, Series of 2004
  Encouraging the Use of CME by All Motorists .
  In Support of the Clean Air Act (June 29, 2004)

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ALTERNATIVE FUEL PROGRAM
(Coco-Biodiesel Program)

• Coco-Biodiesel Distribution Network
• B100 Dealers/retailers
• 192 gasoline stations (Flying V and Seaoil)
• 110 retailers/distributors (Chemrez and Senbel)
• Pre-blended 1 CME (B1) outlets
• - Flying V stations
  - Unioil
  - Seaoil - FilOil
  - USA 88

DEPARTMENT OF ENERGY
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ALTERNATIVE FUEL PROGRAM
(Coco-Biodiesel Program)

• I E C
• Stakeholders consultations and seminars on
  Coco-Biodiesel Program, M C 55 and demand
  expansion (expanded utilization of CME) in
  cooperation with TUP, PCA, CME manufacturers and
  USDOE/USAID SEDP
• Audio visual presentations, collateral materials
  website
• Focused group discussions (i.e. clean cities
  program)

DEPARTMENT OF ENERGY
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ALTERNATIVE FUEL PROGRAM
(Coco-Biodiesel Program)

• Steps Forward
• Legislative measure Biodiesel/Biofuels Bill
• - mandate 1 CME blend by 2006 to
  all diesel fuel
• Continue IEC campaigns to accelerate public
  acceptance especially in Clean Cities pilot areas
  (Baguio, Davao, Marikina and Makati)
• Expand utilization of CME nationwide power
  generation and marine transport

DEPARTMENT OF ENERGY
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ALTERNATIVE FUEL PROGRAM
(Fuel Ethanol Program)
LEGISLATIVE MEASURES

• HB 4629 Mandating the Use of Bioethanol or
  Ethyl Alcohol and other Biofuels as
  Transport Fuel
• SB 2007 Mandate the Use of Biofuels in the
  Transport Sector

DEPARTMENT OF ENERGY
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ALTERNATIVE FUEL PROGRAM
(Fuel Ethanol Program)

• Ethanol Production
• NDC-Bronzeoak Fuel Ethanol and Power Plant
• - Location San Carlos City, Negros Occidental
• - Investment P1.5 Billion
• - Ethanol Distillery 100,000 liters/day (30
  million liters/yr.)
• - Cogeneration Plant 9 MW
• - Timeline 1Q 2006 (construction) 2nd Half
  2007 (operation)

SUPPLY
DEPARTMENT OF ENERGY
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ALTERNATIVE FUEL PROGRAM (Fuel
Ethanol Program)
INCENTIVES

• Executive Order No. 449 Tariff is reduced
  from 10 to 1 when imported with certification
  from the Department of Energy that this article
  will be used for the Fuel Ethanol Program.
• - Quality Specification Ethyl alcohol strength
  by volume of exceeding 99 volume
• Tax Code P 0.05/l excise tax on fuel ethanol
  vs. P23.30/l
• DOFDOE Joint Guidelines drafting
• BIR Draft Revenue Regulation

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ALTERNATIVE FUEL PROGRAM (Natural Gas
Program)

• POLICY INITIATIVES
• Executive Order 164 providing 1 import duty of
  NGV related equipment, parts and components
  (January 10, 2003)
• Promulgation of 48-sets of Philippine National
  Standards for Natural Gas Utilization for
  Transport (June 2003)
• Executive Order 290 Implementing the Natural Gas
  Vehicle Program for Public Transport (February
  24, 2004)
• Department Circular No. 2004-04-004 Guidelines
  on the Issuance of Certificate of Accreditation
  (CA) and Certificate of Authority to Import (CAI)
  Under the NGVPPT (April 2, 2004)
• Executive Order 396 Reducing the Rates on CNG
  Vehicles and NGV Industry- Related Equipment
  (December 31, 2004)
• Department Circular No. 2005-07-006 Directing the
  Enhance Implementation of the NGVPPT and the
  Development of compressed Natural Gas (CNG)
  Supply and Infrastructure. (July 5, 2005)

DEPARTMENT OF ENERGY
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ALTERNATIVE FUEL PROGRAM (Natural Gas
Program)
INCENTIVES

• Attractive CNG price substantially lower than the
  pump price of diesel (P 14.52/diesel liter
  equivalent)
• Zero percent (0) rate of duty
• Income Tax Holiday
• Preferential franchises
• Manpower development and capability building
  through training and technology transfer
• Affordable and commercially tenable financial
  package from GFIs
• Accelerated issuance of ECC for NGV facilities
  and refueling stations

DEPARTMENT OF ENERGY
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ALTERNATIVE FUEL PROGRAM (Natural Gas
Program)

• MARKET DEVELOPMENT
• Accreditation of 7 bus operators
• - HM Transport, RRCG Transport, KL Transport,
  Pascual Liner, Greenstar Express, Biñan Bus
  Line, CNG Vehicles Corp.
• Delivery Schedule of CNG Buses
• - 5 units (October 2005)
• - 200 Units (Total by 1st quarter 2006)
• Target for 2007-2008
• - 2,000 CNG buses, 10 CNG refueling stations
• Potential suppliers of CNG buses
• Cummins Westport Asia, Daewoo, Ashok Leyland

DEPARTMENT OF ENERGY
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ALTERNATIVE FUEL PROGRAM (Natural Gas
Program)
Standards Development
(48 sets of PNS promulgated
on June 2003)

• Road vehicles
• Refueling Station
• Gas Cylinders
• Gas Quality

I E C

• Libreng Sakay Sa NGVs and testing by bus
  operators (May 17, 2004 with 2,286 passengers)
• Bus operators participation
• Presentation of the first CNG Commercial Bus
  (July 1, 2005)

DEPARTMENT OF ENERGY
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ALTERNATIVE FUEL PROGRAM (Natural
Gas Program)
STEPS FORWARDS

• Expansion of the NGVPPT implementation
• Encourage more investments in CNG-related
  industry (CNG suplly infrastructure, NGV
  assembly/manufacture, etc.)
• Formulate pricing mechanism for commercial phase
• Enhance incentives and standards

DEPARTMENT OF ENERGY
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ALTERNATIVE FUEL PROGRAM
(Auto LPG)

• INCENTIVES
• Inclusion of autogas assembly facilities,
  conversion shops, refueling stations, and taxi
  fleet operations in BOIs 2005 IPP
• DBP to finance acquisition of autogas vehicles
  through the Clean Alternative Transport Fuel
  Financing Program
• STANDARDS
• Standards Technical Committees (TC6, TC44,
  TC- dispensing stations) drafted standards for
  autogas vehicles, autogas cylinders and autogas
  dispensing stations.

DEPARTMENT OF ENERGY
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ALTERNATIVE FUEL PROGRAM
(Auto LPG)

• SUPPLY INFRASTRUCTURE
• Petron Gasul
• - 4 dispensing pumps in MM and Cebu
  - - Future installation 10 dispensing
  stations w/in MM / Luzon
• Shell LPG
• - 4 dispensing pumps in Cebu and 1 dispensing
  pump in Cagayan de Oro City - -
  Future installation 2 garage-based pumps

DEPARTMENT OF ENERGY
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ALTERNATIVE FUEL PROGRAM
(Auto LPG)

• MARKET DEVELOPMENT
• Metro Manila 110
• DBP 28
  - Freedom
  taxi 26
  - Munich
  taxi 24 - ABC taxi 15 -
  Saigon taxi 10 - Basic taxi 2
  - Alcotby taxi 2 - Avis
  1 - AAP 1 - Ambi
  Energy 1

• Cebu 258
• Corominas taxi 144
  
  - Emersons transport 60
  
  - Jays Express 44 - RP
  Corominas 10
• Cagayan de Oro 2
• - Jays Express 2

DEPARTMENT OF ENERGY
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ALTERNATIVE FUEL PROGRAM (Auto
LPG)

• STEPS FORWARD
• Public hearing and promulgation of autogas
  standards
• Consultations with autogas stakeholders
• Recommendation for policy action
• Information, education and communication (IEC)

DEPARTMENT OF ENERGY
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Diesel Demand vs. Supply in MBCD
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Gasoline Demand vs. Supply in MBCD
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Fuel Quality is Only One of the Factors
Affecting Emissions
FUEL QUALITY
ENGINE DESIGN
EMISSION
ENGINE MAINTENANCE
VEHICLE USE
TRAFFIC MANAGEMENT
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Thank you