Asia[edit]

In 2007, the 10 ASEAN members and leaders from Australia, China, India, Japan,
South Korea and New Zealand, signed the Cebu Declaration on the East Asian
Energy Security Pact in the Philippines and agreed to promote the development of
biofuels to reduce fossil fuel dependence and promote cleaner sources of energy.
Subsequently, several Asian countries formulated policies and set targets for
biofuels utilization. The Philippine government passed a law that mandates a
minimum of 1% biodiesel blend within three months and at least 2% biodiesel blend
within two years upon the effectiveness of the Act, and at least 5% bioethanol blend
within two years upon effectiveness of the Act and 10% bioethanol fuel within four
years after (Philippine Republic Act No. 9637 or also known as the Philippine
Biofuels Act) . Thailand has established a 10% target for an ethanol mix in regular
gasoline, while Malaysia has set a 5% palm oil diesel blend at domestic pumps.
Indonesia plans to double the palm oil acreage area over the next 30 years.[12]

China
Main article: Bioenergy in China
China has 45 listed companies doing biofuels-related businesses and is expected to
grow even more because of Chinas booming economy. Among the major foreign
investors are Biolux Energy, Bright BioFuels (BBF), Sunshine Technology Group, and
Asia Energy. As of 2008, China ranked No. 8 in Biofuels Country Attractiveness
Indices commissioned by Ernst & Young. Since the late 1990s, China has set up
major policies supporting the development and utilization of biofuels. In 2001, the
government initially formulated the First Five-Year Plan for Bioethanol and the
Special Development Plan for Denatured Fuel Ethanol and Bioethanol Gasoline for
Automobiles. In early 2002, the National Development and Reform Commission
(NDRC) and seven other ministries jointly issued two policy documents: the Pilot
Testing Program of Bioethanol for Automobiles, and the Detail Regulations for
Implementing the Pilot Testing Program of Bioethanol Gasoline for Automobiles. In
2003, a 10% ethanol (E10) blending for its automobile sector was initiated in three
cities in Henan Province and in two cities in Heilongjiang Province. The following
major support policies were provided to carry out the terms of the two policy
documents: (i) a 5% consumption tax on all bioethanol under the E10 program was
waived for all bioethanol plants; (ii) the value-added tax (normally 17%) on
bioethanol production was refunded at the end of each year; (iii) all bioethanol
plants received subsidized old grain (grains reserved in national stocks that are
not suitable for human consumption) for feedstock. This subsidy was jointly
provided by the central and local governments; and (iv) the government offered a
subsidy to ensure a minimum profit for the bioethanol plants. This means that in the
event that a bioethanol plant declares loss in production and marketing, the

government will provide a subsidy equal to the gap between marketing revenues
and production costs plus a reasonable profit that the firm could have obtained from
an alternative investment. There are five licensed ethanol fuel producers and over
12 operational biodiesel plants and roughly 28 more under construction in China.
[13] Among the licensed ethanol producers, the Jilin Fuel Alcohol Company is the
largest, located in an industrial complex in the northern part of China near Jilin City,
Jilin Province. The largest ethanol production facility was established in 2001 as a
joint venture between PetroChina, Cofoco, and the Jilin Food Company. It has its own
power station, water treatment facility, and employs about 430 employees of which
10% are at management level. All ethanol produced at this facility is blended by
PetroChina, which has 20 ethanol blending stations in Jilin Province. Bioethanol
plants are required by the government to sell their produced fuel ethanol only to
appointed oil companies, such as PetroChina or Sinopec at a price of 0.91 or about
$0.82/liter. The government subsidizes the gap between the sale price and
production cost. Chinas potential marginal arable lands are limited and most are
fragmented. In a 2003-2004 survey conducted by the Ministry of Land and
Resources, potential arable lands that are not fragmented amounted only to 7.3
million hectares, accounting for 8.28% of total reserved land.
India
Main article: Biofuels in India
In India, a bioethanol program calls for E5 blends throughout most of the country
targeting to raise this requirement to E10 and then E20. In 2003, the national
government set a 5% mandated blending target for gasoline. Since then, petroleum
with an ethanol blend has been developed and used in nine states and four
territories: Andhra Pradesh, Daman, Diu, Goa, Dadra, Nagar Haveli, Gujarat,
Chandigarh, Haryana, Pondicherry, Karnataka, Maharashtra, Punjab, Tamil Nadu and
Uttar Pradesh.[14] In 2005, the country became the worlds fourth largest producer
of ethanol at 1.6 billion liters and at the same time the worlds largest consumer of
sugar. The country aims to replace 20% of the countrys diesel requirement with
biodiesel in accordance with the National Biodiesel Mission (NBM) by 2012. The NBM
has been, and will continue to be, implemented in two stages: First is a
demonstration project, which was carried out over the period 2003-2007 aimed at
cultivating 400,000 hectares of Jatropha expected to yield about 3.75 tons of oilseed
per hectare annually. The project has also demonstrated the viability of other
related activities/projects such as seed collection and oil extraction. In addition, the
government will build a transesterification plant. Second, a commercialization
period which started in 2007 and will proceed until 2012 will continue with Jatropha
cultivation. The plan also involves the installation of more transesterification plants
that will position India to meet 20 per cent of its diesel needs through biodiesel.
High ethanol prices and low availability of sources has compelled the government to
amend its 5% blending target with the notification that 5% bioethanol blended
petrol shall be supplied in identified areas if (a) the indigenous price of ethanol

offered for ethanol blended petrol programme is comparable to that offered by the
indigenous ethanol industry for alternative uses, (b) the indigenous delivery price of
ethanol offered for the ethanol blended petrol programme at a particular location is
comparable to the import parity price of petrol at that location, and (c) there is an
adequate supply of ethanol.[15] To encourage investment, there are also tax
incentives and excise cuts. At the state level, the Maharashtra government offers
waivers of government fee from the 1 percent turnover tax on anhydrous ethanol,
INR500 per kiloliter (US$0.048 per gallon) permit fee, 4 percent sales tax, 10
percent surcharge on sales tax, INR1,500 per kiloliter (US$0.14 per gallon) import
fee, INR300 per kiloliter (US$0.029 per gallon) service charges and 3 percent Octroi,
which is a local tax collected on various articles brought into the district for
consumption.[16] By 2030, it is expected that India will soon become the worlds
third largest economy due to its speedy growth. In 2005, the GDP of India was
US$0.6 trillion, and it is forecasted to reach US$6.1 trillion by the year 2030 at an
annual growth rate of 9%.[17] The country has about 125 ethanol producers with a
total capacity of 1.25 billion liters of ethanol. Most of these ethanol-producers are
found in sugar cane growing states like Maharashtra and Uttar Pradesh, which also
operate in states such as Tamil Nadu, Andhra Pradesh, Karnataka and Gujarat.[18]
India ranks No. 12 in the 2008 Ernst and Young Indices [19] but may rise higher in
the ranking once the country is able to coordinate tax incentives between states
and state and federal legislation. At present, the country has about 11 factories in
the Uttar Pradesh facilities and is expected to produce about 75 million liters of
anhydrous alcohol by end-September with 7 units in Tamil Nadu (production
capacity of 62.5 million liters of anhydrous alcohol); 8 in Karnataka (anhydrous
alcohol production capacity of 66.5 million liters); and 4 units in Andhra Pradesh
(capacity of over 40 million liters). Similar steps have also been taken by the
cooperative sector units in Maharashtra, Punjab and UP.

Indonesia
On January 25, 2006, the government of Indonesia issued Presidential Instruction
(Instruksi Presiden RI) No 1/2006 regarding Provision and Utilisation of Biofuel as
Alternative Fuel as the legal framework for biofuels development in the country.
Accordingly, 10% of bioethanol and biodiesel are allowed to blend with gasoline and
diesel. To attract more investors, the government provides investment tax
incentives through Government Regulation No. 62/2008, which has the following
salient features: (i) 30% reduction of net income from the total investment, applied
for 6 yrs, or 5% every year; (ii) expediting depreciation and amortization method;
(iii) lower income tax (10%) compared to (15%) in the past for royalties earned by
foreign tax payers; and (iv) a longer period of compensation of lossmore than 5
yrs but less than 10 years. To help small farmers, the Ministry of Finance issued

Regulation No. 117/PMK.06/2006 or Credit for the Development of Bio-fuel Energy

and Plantation Revitalization. This is a subsidized credit scheme for farmers
involving several government owned banksPT. BRI, PT. Bank Mandiri, PT. Bank
Bukopin, PT. Bank Sumut, and BPD Sumbar. An interest rate subsidy was also
allocated. For example, the market rate for cassava is 18%, while for farmers it is
only 9%. Likewise, the market rate for sugar cane where it is 18% but the rate
charged to farmers is only 12%. During the initial period, there were only two
biodiesel plants in Indonesia: PPKS in Medan and Eterindo in Gresik. At present,
there are nine ethanol plants with a total production capacity of 133,632 kiloliters,
and some of them began to produce as early as 2007 with oil palm plantation
among others like PT Musimas with a capacity of 100,000 tons per year in North
Sumatra and PT Prajona Nelayan with a capacity of 60,000 tons per year in Riau.
Dumai, also in Riau, was identified by the Indonesian government as the largest
biodiesel development center in Indonesia, considering its abundant supply of raw
materials including, oil palm in this area, supported by the availability of port
facilities and the existence of the largest biofuel processing plant (PT Wilmar
Bioenergi with production capacity of 350,000 tons per day). As of 2009, Indonesia
has 32 listed companies that are involved in the biofuels industry utilizing
sugarcane, cassava, and coconut (according to a presentation delivered by the
Directorate General of Electricity and Energy Utilization of the Ministry of Energy
and Mineral Resources, Republic of Indonesia in the 2nd Asia Biomass Energy
workshop, Biofuels Database in East Asia held last December 810, 2009 in Kyoto,
Japan).[20] Of these 32 companies, nine of them are ethanol producers with a total
production capacity of 133,632 kiloliters. Of nine of these companies, only two of
them produce ethanol with specifications for fuel or bioethanol. These companies
are PT Bukitmanikam Subur Persada in Lampung and PT Indo Acidama Chemical in
Surabaya. Total production capacity of these companies reached 93,282 kiloliter per
year. Due to Indonesias initiatives to increase the cultivation of natural resources in
terms of biofuel production in coordination with ethanol producers, the country was
able to rank No. 14 in the Ernst and Youngs Biofuels Indices in 2008.
Israel
IC Green Energy, a subsidiary of Israel Corp., aims by 2012 to process 4-5% of the
global biofuel market (~4 million tons). It is focused solely on non-edible feedstock
such as jatropha, castor, cellulosic biomass and algae.[21] In June 2008, Tel Avivbased Seambiotic and Seattle-based Inventure Chemical announced a joint venture
to use CO2 emissions-fed algae to make ethanol and biodiesel at a biofuel plant in
Israel.[22]
Malaysia
Beginning in 1982, Malaysia developed a comprehensive biofuels programme where
palm methyl esthers and a 5% blend of processed palm oil were the primary
additives to 95% petroleum diesel as transport fuels. At present, Pusat Tenaga

Malaysia Energy Centre forecasted that for the next 25 years the countrys energy
requirements would be tripled from its present consumption levels and expand at a
5.2% annual rate. According to Malaysias national oil company Petronas, the
countrys reserves of 5.2 billion barrels of crude oil may only last for another 20
years at the present rate of extraction unless new oil fields are explored or new
sources of energy emerge. In pursuit of energy security through diversification,
Malaysia passed the Five Fuel Diversification Strategy. Under this strategy, the
Malaysian government enacted the National Biofuel Policy (NBP) in August 2005 to
develop a framework for biofuels. The NBP aims to supplement the diminishing
supply of fossil fuels with renewable resources and has mobilized local resources for
biofuel production. This effort involves the exploitation of local technology to
generate energy for the transportation and industrial sectors and to pave the way
for the export of biofuels. The NBP operates through five strategic objectives:
*Objective 1: Biofuel for Transport. Diesel for land and sea transport will be a
blend of 5% processed palm oil and 95% petroleum diesel. This B5 would be made
available throughout the country.
*Objective 2: Biofuel for Industry. Supply B5 diesel to the industrial sector, to
be used as fuel in industrial boilers, construction machinery, and diesel-powered
generators.
*Objective 3: Biofuel Technologies. Promote research, development, and
commercialization of biofuel technologies.
*Objective 4: Biofuel for Export. Encourage and facilitate the establishment
of plants for producing biofuels for export.
*Objective 5: Biofuel for a Cleaner Environment. Enhance the quality of the
ambient air, reduce the use of fossil fuels, and minimize emissions of greenhouse
gases (mainly carbon dioxide), carbon monoxide, sulphur dioxide and particulates
through the increased use of biofuels.
In August 2006, Malaysias pioneer commercial biodiesel plant started its initial
operations. A total of 55,000 tons of biodiesel were produced between August and
December 2006, and in 2007 production, escalated to 130,000 tons. RBD palm oil
was the primary feedstock used, which accounted for 94% of the total processed
palm oil for biodiesel. To regulate the biofuel industry and promote its further
development, the Lower House of the Parliament passed the Biofuel Industries Act
in April 2007. This statute provides for the mandatory use of biofuels and the
licensing of biofuel-related activities; it also allows the licensing authority to revoke
or suspend any license if the licensee has ceased to produce, operate or carry out
any activity for which the license was issued. The Malaysian government also
approved in the same year a total of 92 biodiesel projects, 57 which were installed
in Peninsular Malaysia and 35 located in East Malaysia, with a combined annual
production capacity of 10.4 million tons or 11.7 billion liters. But at that time, there

were only five plants in operation with combined production capacities of 400,000
tons per year. Therefore, an additional seven plants with production capacities of
615,000 tons were constructed during that year. As of September 2008, there were
14 functional biodiesel plants, but only eight were in operation while the other four
had suspended operations due to incessant price increases of biodiesel feedstock.
From January to September 2008, the estimated total production capacity was
130,000 tons of biodiesel.
Pakistan
The government of Pakistan hopes to build anaerobic digesters in rural areas, for
the production of Biogas to supplement gas yields.
The Philippines
In 2004, demand for imported fossil fuel products in the Philippines reached
approximately 106.5 million barrels of fuel oil, equivalent (MBFOE) to roughly 39%
of the total primary energy supply mix. This volume was 96% of the total petroleum
supply, reflecting the countrys tremendous dependence on imported fossil fuel. The
Philippines total indigenous local energy production (including coal, oil, natural gas,
geothermal, hydropower, biomass, solar and wind) was 139.72 MMBFOE, which in
2004 translated to energy self-sufficiency level of 51%. In terms of foreign
exchange, the importations volume has reach an equivalent to roughly US$ 3.8
billion of currency outflow on an annual basis, the transportation sector
representing the largest consumer. Accordingly, they utilized at least 56 MBFOE,
equivalent to 28.7% of the countrys total consumption. In response to this foreseen
dilemma, the Philippine government formulated a national policy that would reduce
the countrys dependence on imported fossil fuel, protect public health, the
environment, and the countrys natural ecosystem. This initiative would also
generate opportunities for the livelihoods of people, particularly in the countryside.
On January 12, 2007, Republic Act No. 9367, or the Biofuels Act, was enacted to
develop and utilize indigenous, renewable, and sustainable clean energy sources.
The statute mandates the use of bioethanol, biodiesel, and other fuels made from
biomass as alternative forms of energy. Two of the salient features of the law include
a 5% minimum ethanol blend to gasoline within two years of the Biofuels Act and a
10% minimum blend two years thereafter. Based on the Philippine Energy Plan
(2007-2014), a 5% minimum blend was required amounting to 208.11 million liters
of ethanol by 2009. With a 10% blend, 460.63 million liters (inclusive of
consumption growth rate) will be needed by 2011.
On December 16, 2008, the Renewable Energy Act of 2008 was signed into law to
accelerate the exploration, development, and utilization of renewable energy
resources, including biofuels and to provide a legal and institutional framework to
harmonize the fragmented policies for renewable energy in the country. One salient
feature of the policy is to create an environment conducive to investments through

the provision of the following incentives: (a) duty-free importation of renewable

energy (RE) machinery, equipment and materials over the initial 10 years through
the issuance of certifications to RE developers; (b) duty-free importation of farm
machinery and agricultural inputs during the initial 10 years from the effectivity of
the Renewable Energy law; (c) income tax holidays over the first seven years of
commercial operation; (d) accelerated depreciation if an RE fails to receive an ITH
before full operation; (e) cash incentives from RE Developers for Missionary
Electrification, i.e., 50% of the universal charge for power needed to service
missionary areas; (f) corporate tax rates of 10% on its net taxable income after the
initial seven-year ITH period; (g) tax exemptions for carbon credits; (h) special realty
tax rates of not more than 1.5% on equipment and machinery, civil works, and
other improvements; and (i) net operating loss carry-over (NOLCO) during the first
three years of commercial operation will be deductible from gross income over the
next seven years of operation. As of 2009, the Department of Energy has accredited
12 producers of Coconut Methyl Ester (CME) for biodiesel with a total production
capacity of 395,620,165 liters. The Sugar Regulatory Administration (SRA) has
accredited two producers of bioethanol (from sugarcane) with a total production
capacity of 39 million liters per year.
Thailand
The Thai government instituted the use of gasohol in government vehicles to set an
example and to ensure public confidence in biofuels. In 2000, a biomass ethanol
project was approved by the Cabinet to encourage investors from the ethanol and
biodiesel industries. As a result, 24 investment permits were issued to producers,
resulting in a combined production capacity of 4,115,000 liters per day, The
following year, three investment permits with a total production capacity of 595,000
liters per day were issued but allegedly, due to uncertainties involving the price of
ethanol, construction of the ethanol plants was delayed. To encourage more
investors and ensure a sufficient ethanol supply, the government lifted the ceiling
on investment permits. Additionally, the Thai government provides zero taxes on
imported equipment and machinery and zero income tax for eight years. On
September 14, 2006, 18 more permits were granted to ethanol producers enabling
the country to reach a total production capacity of 5,730,000 liters per day. The Thai
government has a policy of non-intervention for biodiesel production, and interested
parties are encouraged to apply for permits to the Department of Industrial Plants,
Ministry of Industry. Two sub-committees were appointed by the Energy Policy
Committee to oversee ethanol and biodiesel production.
In 2006, the Ministry of Energy (MOE) placed a target on ethanol use as a substitute
for methyl tertiary butyl ether mixed with 95 octane gasoline and also to substitute
a portion of 91 octane gasoline at the rate of 1.00 million liters per day. However,
due to an economic slowdown and price effect of gasoline consumption, the MOE
reduced its target to 2.40 million liters per day. The blending target for biodiesel for
the whole country is 5% or 3.96 million liters per day of B100. The initial intention

was to increase by 10% or 8.50 million liters per day in 2012, but for the same
reasons mentioned above, the 2011 target was revised and slashed to 3.02 million
liters per day of B100. On November 22, 2007, the MOE and Bank of Agriculture and
Agricultural Cooperatives (BAAC) decided to provide low-interest, B7,000 million
loans to farmers to grow palm oil for 10 years at a minimum return rate of -0.5% as
a support to their livelihood. To formulate a comprehensive framework for oil palm
development, the cabinet approved on January 15, 2008 a government order to set
up a National Oil Palm Policy. The Department of Alternative Energy Development
and Efficiency under the Ministry of Energy reported that Thailand has at least 48
registered number ethanol companies and 14 biodiesel producers as of 2009.
Developing countries[edit]
Biofuel industries are becoming established in many developing countries. Many
developing countries have extensive biomass resources that are becoming more
valuable as demand for biomass and biofuels increases. The approaches to biofuel
development in different parts of the world varies. Countries such as India and
China are developing both bioethanol and biodiesel programs. India is extending
plantations of jatropha, an oil-producing tree that is used in biodiesel production.
The Indian sugar ethanol program sets a target of 5% bioethanol incorporation into
transport fuel.[23] China is a major bioethanol producer and aims to incorporate
15% bioethanol into transport fuels by 2010. Costs of biofuel promotion programs
can be very high, though.[24]

In rural populations in developing countries, biomass provides the majority of fuel

for heat and cooking. Wood, animal dung and crop residues are commonly burned.
Figures from the International Energy Agency (IEA) show that biomass energy
provides around 30% of the total primary energy supply in developing countries;
over 2 billion people depend on biomass fuels as their primary energy source.[25]

The use of biomass fuels for cooking indoors is a source of health problems and
pollution. 1.3 million deaths were attributed to the use of biomass fuels with
inadequate ventilation by the International Energy Agency in its World Energy
Outlook 2006. Proposed solutions include improved stoves and alternative fuels.
However, fuels are easily damaged, and alternative fuels tend to be expensive. Very
low cost, fuel efficient, low pollution biomass stove designs have existed since 1980
or earlier.[26] Issues are a lack of education, distribution, corruption, and very low
levels of foreign aid. People in developing countries often cannot afford these
solutions without assistance or financing such as microloans. Organizations such as
Intermediate Technology Development Group work to make improved facilities for
biofuel use and better alternatives accessible to those who cannot get them.