Zim's E20 reintroduction could raise stink

Zim's E20 reintroduction could raise stink
Published: 22 June 2018
ZIMBABWE has re-introduced the mandatory blending of petrol to the levels of E20 (a mixture of 80 percent petrol and 20 percent anhydrous ethanol) on the back of fuel price increases.

With effect from last Friday, fuel retailers have been selling E20, up from the prior blending threshold of E15, according to Notice 390A of 2018 published in the Government Gazette.

"The consequence of this approval is that all licensed operators shall from the data of publication of the General Notice be mandated to sell unleaded petrol blended at E20," Energy Minister Simon Khaya Moyo said in the notice.

However, the development is likely to cause a market furore as petrol prices have been on the rise and peaked at $1,47 last week following a huge jump in oil prices after Brent Crude broke through the $80 a barrel mark in May for the first time in nearly four years.

According to central bank governor John Mangudya, the country spends 40 percent of its foreign currency earnings on fuel imports, with diesel taking the lion's share of $851,7 million, while $384 million is spent on petrol imports, giving a total of $1,2 billion per year.

Market watchers contend that E20 thresholds could result in foreign exchange savings.

In July last year, government made a similar announcement but could not follow through as the local ethanol producer, Green Fuel, had difficulties meeting demand and the industry reverted to E15.

The country has implemented mandatory blending of E5 and E85 before.

In the past, Green Fuel has lobbied government to introduce 20 percent mandatory ethanol-petrol blending to maximise national benefits from its $600 million investment at Chisumbanje, and in the process guarantee viability of ethanol production.

The ethanol plant has the capacity to process 374 000 litres of ethanol daily. On a good day, the plant sells between 60 000 and 70 000 litres and sometimes leaves surplus ethanol accumulating at an average rate of 300 000 litres daily.

According to a report by the Minnesota Center for Automotive Research, fuel pumps showed significantly less wear when tested with E20 than with petrol.

The study concluded that overall, E20 did not have any greater negative effects than petrol or E10 on the fuel pumps tested. It also showed there were no substantial differences in the performance of the units tested in the three different fuels.
- fingaz
Tags: E20,


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