According to the Ministry of Industry and Trade, the bio-fuel industry of Vietnam is growing rapidly. As planned, by 2011, the country will have five ethanol fuel factories in operation with the total capacity of 365,000 tons per year which is enough for producing 7.3 million tons of E5 gasoline. By 2025, bio-fuel production technologies in our country will reach the advanced level of the world; output of ethanol and vegetable oil will reach 1.8 million tons meeting about 5% of petrol needs of the whole country.

Currently, PVN (Vietnam National Oil and Gas Group) is building three ethanol plants in Tam Nong district (Phu Tho), Dung Quat Economic Zone (Quang Ngai) and Bu Dang district (Binh Phuoc). All the three are expected to go into operation by 2011.

Under the original plan, when the bio-fuel plant in Binh Phuoc is put into operation, it will purchase 240,000 tons of cassava per year, creating stable jobs for more than 15,000 cassava farmer households in poor and remote areas of Binh Phuoc and Dac Nong.

In 2009, the national cassava production reached nearly 10 million tons. Each year, Vietnam exports millions of tons of dried cassava to countries such as China, Korea and Taiwan. However, to promote bio-fuel industry, Vietnam will reduce the rate of exported raw cassava to provide materials for ethanol plants in the country.

Three quarters of Vietnam’s territory is mountainous and hilly regions, so cassava is well suited to the climate and soil of Vietnam. Especially, the Northern midland and mountainous regions, Southeast and Central Highlands regions are favorable for long-term development of cassava.

Mr. Nguyen Xuan Son - General Director of PVN, said: "It is important that we not only purchase. In the overall material strategy of the company, we have planned material supplying regions, built systems to purchase and supply services to farmers including seed, technology, credit, guidance and information".

The bio-fuel scheme will create opportunities for poor farmers to directly engage in the industrialization, help reduce the rich – poor gap between urban and rural areas, plain and mountainous areas. Cassava which is consumed in domestic factories would save a lot of transportation costs and intermediary expenses compared to cassava exported as raw materials. So income of farmers will be more stable. Besides, price of cassava as well as cassava exports are heavily dependent on fluctuations of world markets, while domestic plants have committed stable consumption at the floor price guaranteeing income for farmers.

E5 bio-petrol after launched in Ho Chi Minh City, Hanoi, Vung Tau, Hai Phong and Hai Duong with over 20 points of sale in August has obtained very encouraging results. Bio-petrol (denoted EX, where X is the percentage of denatured ethanol in the blending formula) is a mixture of traditional gasoline and bio-ethanol which is used as the fuel for internal combustion engines such as motorcycles, cars.

Besides reducing the dependence on gradually depleted sources of fossil fuels, plus being produced from renewable materials which is biodegradable, bio-petrol is also contributing to reducing greenhouse gas emissions because it releases less greenhouse gas than the traditional petrol. This is the reason why the government of Vietnam has determined that bio-fuel industry is the key industry to ensure energy security and environment protection.

Deputy Prime Minister Hoang Trung Hai has assigned the Ministry of Industry and Trade to chair the construction of distribution and consumption network of bio-fuels in the whole country; build and issue regulations on bio-fuels distribution and use; coordinate with the Ministry of Science and Technology to build and issue national standards for bio fuel production and distribution; coordinate with the Interdisciplinary Executive Board to examine and supervise ministries, industries, localities and enterprises in implementing schemes and projects to ensure the rate of progress and quality; every 6 months, periodically report to the Prime Minister the specific results of implementing activities, tasks and projects and propose solutions to ensure the rate of progress and quality. Ministry of Agriculture and Rural Development shall coordinate with the Ministry of Industry and Trade and the Ministry of Planning and Investment to build raw material areas for each specific bio-fuel production project.

According to Dr. Nguyen Phu Cuong - Deputy Director of Ministry of Industry and Trade’s Department of Science and Technology, "the year of 2009 marked the official coming of bio-fuel industry in Vietnam, especially the ethanol fuel manufacturing industry group. Under the plan, by 2011, the country will have five ethanol facilities with the total designed capacity of about 365,000 tons per year, enough for 7.3 million tons of E5 gasoline, exceeding the original target of the project in terms of both quantity and timing".

 Currently, in many countries all over the world, especially in Europe and other developed countries, the use of bio-fuels has been mandatory. World famous automakers such as Honda, Toyota, GM, and Ford have produced ranges of automobiles able to use the E10 bio-petrol without reforming engines. Regional countries like Thailand, Malaysia or China have used this type of gasoline.

According to the plan, by 2012, ethanol plants of PVN will provide about 240-300 million liters per year. Along with the output of ethanol plants deployed by other investors, the domestic supply of bio-fuels in the coming time is expected to meet market needs, while ensuring the stability of cassava output for farmers.

E5 bio-petrol roll-out has marked an important milestone in the energy industry of Vietnam. E5 bio-petrol not only contributes to the protection of energy security and environment but also promotes the development of agriculture economy in rural areas.

 By Minh Duc