Current Ethanol Gasoline Policy is Controversial

Taking ethanol as a starting point for digesting aged foods has been promoted in China for 10 years. The next step is to stop or continue to expand the scope of the pilot? Reporters recently conducted investigations in Anhui, Jilin, Henan, and other places. People from all walks of life have different opinions. However, all parties believe that it is imperative to promote clean energy represented by fiber ethanol on a larger scale and reduce the emission of vehicle pollutants. The grassroots suggested that the current clean energy support policies be adjusted appropriately to adapt to the changed market environment, while vigorously developing various types of clean energy represented by non-grain ethanol, and planning the new energy industry layout from the top-level design of high-intensity local conditions. Meet the needs of clean energy in all regions of the country.

The existing ethanol gasoline policy is facing controversy: To solve the oil shortage, digest grain and promote ecological environment protection, China started to use ethanol gas in the provinces of Jilin, Anhui, Heilongjiang, Henan, etc. in 2003, that is, in the general unleaded gasoline. A 10% proportion of fuel ethanol is added to the formulation.

In 2012, the State approved five fuel ethanol companies. The scope of promotion of vehicle ethanol gasoline has covered 27 cities in 9 provinces. The actual total production capacity has reached 2.2 million tons. China has become the world’s third largest fuel after the United States and Brazil. Ethanol production use country. Reporters recently learned from surveys in Anhui, Jilin, Henan, and other places that the trial area market was basically stable.

In the interview, the interviewed grass-roots cadres, business representatives, and consumers had different views on whether ethanol gasoline should continue to be closed and “forced” use. In Anhui, many respondents suggested canceling the closed operation policy of ethanol gasoline, stop compulsory use, and allow the market to sell two types of gasoline, “delivering the right of choice to consumers”. At the same time, by subsidizing the terminal, the price of ethanol gasoline will be reduced, and consumers will be guided to continue to choose ethanol gasoline. On the one hand, on the one hand, domestically accumulating severe Chenhua grain has already been digested, and a large part of the production of fuel ethanol has shifted to the use of new grains such as corn and wheat. With the shortage of food and the increase in prices, there are new problems with ethanol gasoline “competition with people for food and land for food”. The closed operation maintains a huge market demand, and with the rapid increase in the number of car ownership and consumption of refined oil, this contradiction will be exacerbated.

On the other hand, closed operations, fixed-point production, and fixed-point deployment have made it difficult for private service stations to survive, distorting market conditions, exacerbating monopolies, and even pushing up oil prices in pilot regions. A survey conducted by the Anhui Provincial Chamber of Commerce and Industry Petroleum Association revealed that during the period of the closed operation of the promotion of ethanol-gasoline, the original more than 60 privately-owned refined oil wholesale enterprises in the province had shrunk to only 3, and only diesel oil could be sold. The purchase price of gas stations is also about 400 yuan more than the ordinary unleaded gasoline in neighboring provinces.

However, some people in the industry believe that the existing policy coverage should continue to expand. “In 2012, the corn production in Jilin Province was nearly 30 million tons. The company digested 1.6 million tons per year, which accounts for a very small proportion and has limited impact on the grain market.” Deputy General Manager of China Petroleum Jilin Petrochemical Company, Jilin Fuel Ethanol Co., Ltd. General Manager Li Chun said.

He also calculated that at present, China's annual production of fuel ethanol is about 1.9 million tons, of which 1.7 million tons are corn and wheat. According to the ratio of 1 ton of fuel ethanol produced by 3 tons of corn, a total of approximately 5.1 million tons of corn will be required; 2012 China's corn production is 20.812 million tons, and the consumption of fuel ethanol is less than 2.5%. In addition, China's grain market has been highly internationalized, and foreign corn, which can be imported cheaper, can basically meet the processing needs.

Zhang Xiaoyang, chairman of Henan Tianguan Group, proposed that the entire process of carbon production, extraction, consumption, to achieve a closed cycle of carbon, with clean, convenient, safe and many other irreplaceable advantages. "To develop a recycling economy and build a beautiful China, the fuel industry is an industry that has seen practical results. For the past 10 years, the country has chewed on teeth, and it is time to return to the country. Policies must continue to expand."

These enterprises are worried that, in the current consumer awareness and acceptance of new energy is not high today, once the new energy industry does not directly intervene in the policy, the original fragile development environment will worsen, and further advise the country on the fiscal tax, etc. Support policies are adjusted.

Zhang Xiaoyang said that the subsidies for grain ethanol in 2012 fell from 950 yuan per ton to 500 yuan, and the concessions on taxation are also continuously decreasing. By 2015, tax incentives will be completely eliminated, which is equivalent to “one radish with two heads cut”, the company said. The factors that reduce costs are still far from the reduction of policy preferences.

"The ex-factory price of fuel ethanol per ton is 91.1% of the ex-factory price of gasoline, and the selling price is the same as that of regular gasoline. With the current price of gasoline of 8,000 yuan per ton, each company selling 1 ton of Sinopec and PetroChina will earn about 720 yuan. The subsidy for grain ethanol is only 500 yuan per ton, which is equivalent to giving subsidies to Sinopec and PetroChina, said Lu Shengqi, deputy general manager of Tianguan Group.

Consensus in the industry: Non-food ethanol is the focus While policy trends are controversial, there is no dispute over the development of clean energy. In the aspect of fuel ethanol, people in the industry agree that non-food and cellulosic ethanol should be the focus of the next step.

Since the beginning of 1997, Henan Tianguan Group has developed 15 years of R&D to develop key fiber ethanol technologies with completely independent intellectual property rights. Zhang Xiaoyang stated that as the core of the new energy game in the world, the fiber ethanol industry has been highly valued and strongly supported by governments of all countries, among which the U.S. government has made fiber ethanol industrialization a national strategy and introduced a series of fiscal and taxation support policies, including the elimination of fiber ethanol by US$1.01. / Gallon tax, and give fiber ethanol equivalent to grain alcohol 2.24 times the tax subsidies.

Jilin Fuel Ethanol Co., Ltd. is also negotiating the introduction of cellulosic ethanol technology with DuPont Co., Ltd., which can use corn stover as raw material to process ethanol.

At present, the production of corn stalks and corn in Jilin Province is similar. Farmers cannot handle so much straw, and most of them are directly burned in the fields. "And we estimate that if a 80,000-ton cellulosic ethanol plant is built, only a few dozen kilometers of stalks around Jilin City will have new uses, and the benefits to farmers will exceed one billion!"

Industry insiders also suggested that a set of long-term and stable fiscal and taxation policies that support the development of fiber ethanol be introduced as soon as possible.

The first is to comprehensively use the current fiscal and taxation support policies for the bio-fuel ethanol industry. In addition to the non-grain ethanol exemption of non-food ethanol and VAT first-come-first-out policies, the straw straw used in straw ethanol production is subject to the existing straw sizing. Power generation incentives are given to subsidies for fiber ethanol production, such as 0.35 yuan per unit of electricity, and about 350 yuan per ton of straw.

The second is to learn from the successful experience of the development of China's power industry, the establishment of fiber ethanol special ** or vehicle biofuels special **. According to the current market price of oil, plus 0.02 yuan per liter of oil, as the country's unified management of **, specifically for the production of fiber ethanol plant and operating subsidies.

The third is to arrange special subsidies for recycling and transportation of straw. Li Chun said that at the initial stage of the cellulosic ethanol project, the acquisition of straw requires the government's strong support.

However, Zhang Xiaoyang also proposed that while maintaining the stability of the policy, it should also be adjusted on a stage-by-stage basis so that the company can develop rapidly without “living on the subsidies to eat the national meal”. He suggested that it is possible to use a five-year period as the phase of support policy is stable, and each phase will be appropriately reduced to some support. "This will probably push the fiber ethanol industry up by two or three stages."

Alternative energy market "diversification"

First of all, the grass-roots level suggested that the relevant departments should adjust their local conditions and scientifically plan the layout of clean energy in the country from the perspective of top-level design. This will not only meet the energy needs of all regions, but also ensure stable supply, save costs, and reflect economic benefits, especially when closed and promoted. In the case of clean energy, it must first consider regional characteristics.

For example, in the large grain-producing provinces such as the Northeast, it is possible to continue the development of grain ethanol gas and non-grain ethanol gasoline produced from straw; in the Yangtze River basin and the southern subtropical regions, such as Guangxi, it is possible to develop fuel blends of sweet sorghum, cassava, etc. In the coal-producing provinces such as the northwest, methanol gasoline can be developed; in areas where there are no biological crops and coal resources, natural gas power can be developed.

Second, we must actively develop other alternative energy sources so that we can “walk on multiple legs”. Gao Wei, Minister of Production Support of Jianghuai Automobile Power Research Institute, proposed that methanol in the industrial chain also has the advantage as a fuel compared with ethanol in the agricultural chain.

In addition, among various alternative energy sources for vehicles, natural gas is also an ideal clean fuel, with multiple advantages in resources, environmental protection, economy, and safety. For example, compressed natural gas vehicle CNG has low energy consumption and low pollution emission, and it is an internationally recognized alternative energy source for automotive use. LNG LNG vehicles have the advantage of long-range mileage in addition to the advantages of compressed natural gas vehicles. At the same time, electric vehicles as a zero-emission vehicle, its power mainly from the power generated by the power plant, you can also choose to charge at night, avoid power peaks, improve the efficiency of electrical energy, but also should strongly support.