LA PAZ – Bolivia gave the green light to the massive production of bioethanol to replace the importation of additives for gasoline and diesel fuel in accord with a law signed by President Evo Morales.
Morales signed the Law on Vegetable Derived Additives on Saturday during a ceremony in Minero, a city in the eastern region of Santa Cruz, attended by representatives of the main business and industrial unions, along with workers from the sugar cane sector.
The president emphasized that the promulgation of the measure is “something historic” because farmers and industry have waited 30 years for the project to come to fruition.
“Ethanol is not only for the sugar cane growers, ethanol is for everyone. We all win, the state, the agroindustrial sector and thus we’re building the new Bolivia with economic growth,” Morales said.
The law establishes the legal framework allowing production, storage, transport, marketing and mixing for additives of vegetable origin with an eye toward progressively replacing the importation of additives for fuels, thus guaranteeing the country’s food and energy security.
Calculations are that ethanol production will result in growth in the gross domestic product (GDP) of 0.90 percent in one year and 4.4 percent in the agricultural sector in particular, the president said.
The project will allow the government to save about $20 million the first year by reducing the subsidy for fuels and those savings will total $130 million by 2025, Morales said.
The president noted the investments made in several sugar mills before the promulgation of the law, a situation that – in his judgment – shows the confidence of the private sector in the government.
Last Thursday, Mariano Aguilera, the chairman of the board of the Guabira sugar mill, said in a press conference that he was pleased that the government was moving ahead to enact legislation for the production, sale and blending of vegetable-derived additives.
Aguilera said that once Morales signed the legislation into law, the mill could immediately enter into contracts with state energy company YPFB and start distributing bioethanol so domestic consumers could begin using fuels with the new blend.
YPFB has called on domestic sugar mills to produce some 80 million liters of bioethanol in the first year, Aguilera said, adding that that volume could increase steadily in subsequent years.
Located in Montero, a town in Santa Cruz, Guabira is made up of 1,670 shareholders (sugar cane entrepreneurs), 1,400 industrial workers and more than 1,526 cane growers.
Aguilera said the mill planned to invest $40 million over the next two years to take on the “great challenge” of bioethanol production.
The mill has already produced more than 6 million liters of ethanol that is in its warehouses and ready to be delivered to YPFB when required, he said.