Red tape stalls ethanol project
By Gift Phiri, Senior Writer
Wednesday, 29 February 2012 16:25
HARARE – Bureaucracy is slowing down an ethanol project that could reduce
the country’s reliance on imported fuel and directly employ 7 000 people,
the Daily News has learnt.
Cash-strapped Zimbabwe is a net importer of finished petroleum products, yet
government is taking ages to okay a policy proposal to boost sales of the 30
percent cheaper and environmentally friendly blended petrol, E10, produced
at Zimbabwe’s first green fuel plant in Chisumbanje — 500km south of Harare.
The Daily News understands Green Fuel (Pvt) Limited — a $600 million joint
venture between state-run Arda and a group of private investors — has asked
government, which has given Green Fuel national project status, to introduce
a mandatory blending policy — a decision to make blending of ethanol and
petrol compulsory as an import substitution measure.
Green Fuel says a mandatory blending policy dovetails with government’s
medium term economic blueprint which stipulates that Zimbabwe should
“promote and use renewable energy including ethanol blending”.
Green Fuel produces ethanol from sugar cane. By-products include electricity
enough to light up Manicaland province and stock feed.
Currently, conventional bulk petroleum companies’ facilities and retail
filling stations are designed for petrol and diesel only and the
introduction of blended petrol is posing logistical problems to the
operators of service stations and petroleum companies.
Fuel companies have raised concerns that they need to allocate a third pump
for the blended petrol, separate tanks, as well as separate transport
carriers for the ethanol.
The almost 400 filling stations in Zimbabwe have been reluctant to incur
what they perceive as additional costs to modify or upgrade their existing
pumping and storage facilities.
But if government approves mandatory blending and makes it obligatory for
the bulk of petrol sold in Zimbabwe to be blended petrol, there will be no
need to modify facilities at filling stations, a move that will also
significantly slash government’s fuel import cost.
The Daily News heard that by the end of January, Green Fuel had produced 10
million litres of ethanol, which is currently sitting in storage facilities
around the country.
So far, only 105 000 litres has been sold, just above 1 percent of the total
ethanol produced, meaning Green Fuel is producing more fuel that it can
sell because of the facilities’ crisis at filling stations and other bulk
petroleum companies.