The New South Wales government's decision to mandate a 2 percent ethanol content in gasoline will probably boost fuel prices for motorists, said Caltex Australia Ltd., the nation's biggest oil refiner.
The state has only one ethanol supplier and the company's production capacity is 75 million liters a year, less than the mandated requirement of 120 million liters, Sydney-based Caltex said late yesterday in an e-mailed statement.
State Premier Morris Iemma said yesterday that if re-elected in March, he will require all gasoline sold in Australia's most populous state to contain at least 2 percent ethanol starting in September, as a step toward a 10 percent ethanol content by 2011. The government is promoting use of biofuels such as ethanol to cut carbon dioxide emissions, blamed for global warming.
``A monopoly supplier and a shortage of ethanol mean high prices for ethanol,'' Caltex Managing Director Des King said in the statement. ``When the United States mandated ethanol in 2006, ethanol prices at one point were twice the price of petrol.''
Caltex instead wants governments to ensure that E10, a 10 percent ethanol blend, can be priced below regular gasoline through a grant for producers. The company sells E10 at a 3 cents a liter discount to regular unleaded gasoline.
Closely held Manildra Group is the only ethanol producer in New South Wales. Ethanol is made from agricultural crops such as sugar or grains. Mandating 2 percent ethanol content in gasoline will cut greenhouse gas emissions from transport in the state by an estimated 2-7 percent, Iemma said yesterday.
The state has only one ethanol supplier and the company's production capacity is 75 million liters a year, less than the mandated requirement of 120 million liters, Sydney-based Caltex said late yesterday in an e-mailed statement.
State Premier Morris Iemma said yesterday that if re-elected in March, he will require all gasoline sold in Australia's most populous state to contain at least 2 percent ethanol starting in September, as a step toward a 10 percent ethanol content by 2011. The government is promoting use of biofuels such as ethanol to cut carbon dioxide emissions, blamed for global warming.
``A monopoly supplier and a shortage of ethanol mean high prices for ethanol,'' Caltex Managing Director Des King said in the statement. ``When the United States mandated ethanol in 2006, ethanol prices at one point were twice the price of petrol.''
Caltex instead wants governments to ensure that E10, a 10 percent ethanol blend, can be priced below regular gasoline through a grant for producers. The company sells E10 at a 3 cents a liter discount to regular unleaded gasoline.
Closely held Manildra Group is the only ethanol producer in New South Wales. Ethanol is made from agricultural crops such as sugar or grains. Mandating 2 percent ethanol content in gasoline will cut greenhouse gas emissions from transport in the state by an estimated 2-7 percent, Iemma said yesterday.
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