Experts have warned that if the government doesn’t cut the environmental protection tax and fees on petroleum products, the national economy will suffer.

The high price of input materials to produce ethanol and the policies on restricting imports to protect local production have made E5 petrol prices unattractive to consumers.

With the decision to replace RON 92 petrol with E5 biofuel commencing early next year, plus new tax policies, two ethanol plants which have been taking losses will be brought back to life.

The Ministry of Industry and Trade (MOIT) estimates that from January 1, 2018, when Vietnam shifts from using RON 92 to RON 95 and E5, total E5 consumption volume would be around 5.357 million cubic meters, or 70 percent of total fuel demand.

VietNamNet Bridge - The government’s decision to stop the use of RON 92 petrol is expected to revive a series of ethanol plants which have been bogged down in problems.

VietNamNet Bridge - The plan to make a switch from the popular RON A92 petrol to biofuel E5 by January 1, 2018 may fail as ethanol plants have become bogged down in difficulties.

The national oil and gas group PetroVietnam, which has insisted on building biofuel plants as part of a biofuel development strategy, has halted the operation of the Dung Quat bio-ethanol plant.

VietNamNet Bridge - Doubts have been raised about the feasibility of a plan to replace A92 petrol with E5 biofuel, even though distributors have been told to stop selling A92 to focus on E5.

VietNamNet Bridge –  The biofuel E5 (ethanol 5 percent) RON 95, used in next-generation vehicles, is still not available in Vietnam, while E5 RON 92 is being sold at hundreds of filling stations nationwide.

The Ministry of Finance (MOF) plans to raise the import tariff on E5 bio-fuel sharply by seven times so as to protect domestic production and encourage sales in Vietnam.

 VietNamNet Bridge – The Vietnamese scientists from the leading research institute have affirmed that E5, the biofuel made in Vietnam, can be used for the old-generation engines, the popular ones in Vietnam.

 VietNamNet Bridge – While 5 per cent bio-ethanol (E5) is still a new type of energy source in Viet Nam, other countries have made more progress in producing and applying 85 and 100 per cent ethanol bio-fuel,

 Viet Nam will continue to develop its production of bio-fuel, despite the fact it has been slow to catch on.

Scientists believe that the government should encourage people to use biofuels instead of forcing them to do that.

 VietNamNet Bridge – Viet Nam will start blending bio-fuels with petrol to power road vehicles from 2014, as the government seeks to push ahead with its commitment to establish green credentials.