Energy Ministry wants more ethanol

The Energy Ministry wants the Thai Ethanol Manufacturing Association (TEMA) to increase daily production capacity from 930,000 litres now to 1 million litres from the October-November period.

The move is expected to help ease the fuel crunch.

A ministry source yesterday said the TEMA was also urged to talk some manufacturers into shortening their plant-maintenance shutdowns from a month to two weeks.

Five ethanol plants have scheduled maintenance work during the next two months, spurring fears among oil retailers that their supply of ethanol used to make gasohol will be cut off.

The source said the ministry considered the low supply to be seasonal, coming at the end of the sugar-cane crushing season, and made worse by ethanol manufacturers' greed for higher prices.

Some were accused of hoarding until the new ethanol price of Bt22.11 a litre went into effect tomorrow.

The third-quarter price was Bt18 a litre.

"Most ethanol plants will not increase capacity, but they still operate as usual. But some oil retailers may be affected, because some plants supply ethanol for liquor production," he said.

Energy permanent secretary Pornchai Rujiprapha insisted deficiencies would not appear but admitted supply would be tight in the fourth quarter. He expects new supply to come on the market once the ethanol price rises.

TEMA chairman Sirivuthi Siamphakdee said the association had asked ethanol manufacturers not to halt production over the next two months. The TEMA expects the ethanol situation to return to normal in December.

"After the December-April harvest season, molasses stock will reach 3 million tonnes. From this, 1.2 million tonnes will go to alcohol plants, 600,000-700,000 tonnes will be produced as sugar and monosodium glutamate, and the rest will go towards ethanol production," he said.

Shutdowns of ethanol plants for annual maintenance are planned in advance, and oil firms should work around them, he said.

The government should accelerate discussions with the private sector about the situation and also raise ethanol prices, in order to encourage manufacturers to produce ethanol from sugar cane and cassava, he added.