By: Rosemarie S. Gumera Manager III, Sugar Regulatory Administration (SRA) SRA Alternate Representative, National Biofuel Board

Alternate Representative of the Dept. of Agriculture, National Renewable Energy Board

Brief Background

of the Philippine

Sugarcane

Industry

State of the Philippine Sugarcane Industry

Sugarcane Plantation

423,000 has.

80% of farms are 5 has.

& less

65,000 farmers &

increasing due to land

reform

59 TC/Ha

1.96 LKg/TC

Current cost of

production- $1,628 -

$2,326/ha

Processing Facilities

27 sugar mills

60% capacity utilization

14 sugar refineries

73% capacity utilization

8 bioethanol distilleries

222 million liters capacity

57% of mandated market

5 Power Generating Plants

Installed Capacity of 84 MW

Around $2.02 Billion contribution to the national economy in CY 2013-2014 due to sale

of sugar, molasses & ethanol; With More than 700,000 workers and 5M dependents

Contribution to trade balance & foreign reserves = $ 111.76 million

SUGAR

BIOETHANOL

POWER

SPECIALTY SUGARS

BIO-PLASTICS

BIO-WATER

A Strategically Diversified Sugarcane Industry

Improving Productivity Through the “Block Farming Business Model”

Mill District Devpt

Councils

Conduit of Initiatives &

Coordination

Block Farm (consolidation of small

landholders)

Agribusiness Unit in

Sugarcane Mill Districts

Service Providers

Support Services

thru Convergence DAR

Organizational devpt

Land tenure

improvement DA

Infrastructure devpt

Livelihood SRA

Technical Assistance

Technology transfer

Productivity improvement DTI

Marketing

Investments DOLE/State Universities

Skills devpt – farmers &

workers

Agripreneurship, HRD DOE

Ethanol & Power

Generation devpt

Enterprise

Development

Marketing

Investment

Crop Loans Planters

Association

Sugar Mills

Ethanol

Distilleries

Industrial

Users

NGOs

GFIs / Banks

Farm Manage- ment &

Technical Consul-tancy

Equip-ment

Services

Financial Services

Human Resource Development & Socio-economic Programs of the Sugarcane Industry

1. Skills development – dependents of small farmers and workers will be trained on skills required in the implementation of industry programs like farm managers, mechanics, farm machinery operators, bookkeepers, etc.

2. Scholarship program – partner with gov’t state universities in providing scholarships to dependents of small farmers and workers on degree / technical courses needed by the industry like electrical / mechanical engineers, agriculturists, sugar technicians / technologists, accountants, chemists, etc.

3. Hospitalization, education, livelihood, death benefits & cash bonuses for sugarcane workers & dependents derived from the social amelioration program of the sugar industry (over & above statutory labor benefits)

The Bioethanol

Fuel Program

San Carlos Bioenergy - Southeast Asia’s first

integrated sugarcane to alcohol distillery and power generation plant

San Carlos Bioenergy - NOT A STAND-ALONE

DISTILLERY

SUGARCANE

MOLASSES

SYRUP

MILL

FERMEN-TATION

DISTIL-LATION

SYRUP HOUSE

BOILER

STEAM

POWER HOUSE POWER

ETHANOL

REVENUE

POWER

REVENUE

SYRUP

REVENUE

BAGASSE

STEAM

BOILER

SYRUP HOUSE

WASTEWATER

TREATMENT

COMPOST

RECYCLED WATER

ZERO DISCHARGE

WASTEWATER TREATMENT

BIOGAS

FERMEN-TATION

IRRIGATION WATER

Ethanol Companies / Year

Operational

Rated Capacity (Million Liters)

Feedstock Estimated Feedstock Requirement (MT)

1. Leyte Agri Corp. - 2008 9.0 Molasses 37,000

2. San Carlos Bioenergy Inc. - 2009

40.0 Molasses Sugarcane

122,000 143,000

3. Roxol Bioenergy Corp. – 2011

30.0 Molasses 122,000

4. Green Future Innovations Inc. - 2012

54.0 Sugarcane 771,000

5. Balayan Distillery Inc.- 2014

30.0 Molasses 122,000

6. Universal Robina Corp. – 2014

30.0 Molasses 122,000

7. Far East Alcohol - 2015 15.0 Molasses 61,000

8. Kooll Company Inc. – 2015

14.12 Molasses 49,000

TOTAL 222.12 Molasses Sugarcane Sugar equivalent

635,000 914,000 86,830 13,585 existing area

Feedstocks Estimated Quantity (MT)

Operational Upcoming TOTAL

Molasses @ 245 L/MT 525,000 391,000 916,000

Sugarcane @ 70 L/MT 914,000 1,786,000 2,700,000

Sugar Equivalent to Sugarcane @ 1.9 LKg/TC

86,830 169,670 256,500 45,000 ha. existing area

CROP YEAR 2013-14 Production

Molasses, MT 1,009,139

Sugar, MT 2,461,808

Sugarcane Area 423,000 hectares

The Bioethanol Mandate was passed in Dec 2006 and

became effective in Feb 2007

Let us examine what went wrong during the early years of implementation of the biofuels law in the

Philippines…

Historical Bioethanol Supply – Demand, 2009-2014

Year Local Supply

(million Liters)

Imported

(Million Liters)

Consumption

(Million Liters)

2008 0.973 12.56 13.53 (voluntary

blending)

2009 23.284 64.24 87.52 (5% blend)

2010 10.174 140.44 178.25 (5% blend)

2011 4.138 215.00 197.40 (5% & 10%

blend w/ exemptions)

2012 35.086 248.40 306.50 (10% blend w/

exemptions)

2013 71.538 318.79 436.503 (10% blend)

2014 114.858 339.06 441.514 (10% blend)

Distillery

Rated

Capa-

city

2008 2009 2010 2011 2012 2013 2014

1. Leyte Agri

Corp. 9.0 0.973 3.221 - 0.300 0.928 2.515 2.714

2. San Carlos

Bioenergy Inc. 40.0 - 20.063 10.174 3.828 21.733 32.170 28.999

3. Roxol

Bioenergy Corp. 30.0 - - - - 8.563 19.960 35.614

4. Green Future

Innovations Inc. 54.0 - - - - 3.864 16.893 22.278

5. Balayan

Distillery Inc. 30.0 - - - - - - 22.652

6. Universal

Robina Corp. 30.0 - - - - - - 2.023

7. Kool

Company

Philippines

14.12 - - - - - - 0.577

8. Far East

Distillery 15.0 - - - - - - 0.000

Historical Bioethanol Production in Million Liters, 2009-2014

The Road to a Cleaner Fuel is Rough…

World sugar deficit in

2010 resulted to

skyrocketing of sugar

prices

Petroleum

companies

benchmarked

price of local

ethanol with

imported ones

Storage tanks of local

ethanol producers

overflowed, oil

companies are not

buying local ethanol

Difficulty of

investors in

securing

feedstock

areas due to

fragmentation

of farms

because of

land reform

2015 Ethanol Fuel Distilleries with On-Going Construction

Distillery Feedstock

Production

Capacity

(Million Liters)

Projected

Year of

Operation

1. Cavite Biofuels Sugarcane 39.0 2016

2. Absolut

Distillery Molasses 30.0 2016

3. Asian Alcohol Molasses 30.0 2016

4. Emperador

Distillery

Sugarcane

Molasses 30.0 2016

TOTAL 129.0

What Stimulated Production & Investments from 2011 onwards…

Firm gov’t

policy and

regulatory

framework

supportive of

the program

Predictable

Investment

Environment through

a pricing mechanism

Conversion

of potable

distilleries

into

bioethanol

fuel

Reduction in GHG Emission - Yes measured

thru LCA with IEEJ

Sustainable rural development through more

jobs and increased income of workers – Yes,

through head count of additional employment

& proliferation of vendors & small-scale

establishments around the factory / community

Reduce dependence on imported fossil oil

– Yes thru the volume displaced by ethanol

FAO BEFS RA

• PHL became confident on the

use of sugarcane as

bioethanol feedstock thru

intensification

FAO BEFS Roadmap

• Provide guidance

throughout the

implementation process

GBEP indicators

• Eliminates uncertainties,

builds up confidence

among investors &

strengthens country

position on bioethanol

projects

Relaxation of the mandate???