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E20 fuel shortage looms

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GOVERNMENT’s ambitious programme to introduce a mandatory E20 petrol-ethanol blending ratio by the end of this month now faces collapse

GOVERNMENT’s ambitious programme to introduce a mandatory E20 petrol-ethanol blending ratio by the end of this month now faces collapse after it emerged that the country’s sole ethanol producer, Green Fuel, is failing to meet local demand. BY TARISAI MANDIZHA

A recent survey by NewsDay revealed that most service stations around the country had run out of ethanol blend and were now selling unleaded petrol, hence the current rise in the price of petrol.

Blending started with 5% ethanol to 95% unleaded petrol in August 2013, following the issuance of an ethanol production licence to Green Fuel. The blending increased to 10% and then 15% with the government pushing for E20 by March 2015.

Zimbabwe Energy Regulatory Authority (Zera) chief executive officer Gloria Magombo said the production of ethanol in the country was generally affected by the inaccessibility of fields due to incessant rains and other factors like level of yield.

“The Minister of Energy and Power Development (Samuel Undenge) is empowered to waiver and give exemptions to the blend levels from time to time in accordance with the law and supply levels.

“Currently the blended fuel in the market was E5 being 5% ethanol and 95% unleaded petrol. Indeed, according to the law, it is illegal to sell unleaded fuel,” Magombo said.

“Ethanol production is generally affected by the inaccessibility of fields due to incessant rains and other factors like level of yield.” She said production of ethanol was seasonal and that was why the law provided for a waiver of blending levels from time to time to cater for reduced supply.

Magombo said the Minister of Energy and Power Development has the prerogative to announce such variations in light of supply levels based on Statutory Instrument 81 of 2014.

She said generally there should be more producers of ethanol supplying the market.

“There has been no policy shift. The reduction to E5 has been in response to reduced production during the rainy season. These changes in response to supply constraints are common in most ethanol-producing countries as product availability is affected by the rains and accessibility of the field,” Magombo said.

However, analysts have dismissed claims that incessant rains affected the production of ethanol as many parts of the country experienced a long dry spell resulting in crops such as maize becoming a write-off.

Ethanol is made from sugarcane, largely produced through irrigation in the Chisumbanje and Chiredzi areas. Green Fuel is a joint venture between the Agricultural and Rural Development Authority (Arda) and businessman Billy Rautenbach’s Macdom and Ratings.