Germany politicans spark new E10 debate but refiners still confident

30 August 2011 17:11  [Source: ICIS news]

LONDON (ICIS)--Leading politicians in Germany’s coalition government are questioning the country’s bioethanol strategy but a refining industry group said on Tuesday it remains confident about the long-term outlook for 10%-bioethanol blended gasoline (E10).

Germany approved E10 for sale at the pump since 1 January, but the fuel turned out to be unpopular as many drivers feared it may damage the engines of their cars.

Patrick Doring, parliamentary vice chair of the Free Democrat party, said the government’s E10 policy has failed.

In an interview with regional daily Passauer Neue Presse, Doring called on the government to promote biodiesel, instead of bioethanol, in order to comply with EU fuel and renewable targets.

Meanwhile, the Free Democrat's parliamentary chair, Rainer Bruderle, told Saarbrucker Zeitung that E10 needs to be “discussed once more.”

A high-profile summit with industry leader earlier this year to promote E10 had not yielded the results Bruderle had expected, the former economics minister added.

The comments came after an oil industry executive said last week that Germany’s refiners could face penalties of up to €400m ($580m) from the troubled E10 launch, which they would seek to pass on to drivers.

Refiners launched E10 because it enables them to comply with EU fuel quality standards and quotas. If they fail to comply, they face penalties.

Germany’s refining industry trade group MWV said on Tuesday that an estimated 3m cars are running on E10 on a regular basis – with no reports of motor damage.

MWV is confident that E10 future sales will rise, spokeswoman Karin Retzlaff said.

However, so far, Germany’s E10 sales are not at levels to allow refiners to comply with quotas, she said.

Retzlaff added that refiners would seek to include all costs related E10 into gasoline prices at the pump.

($1 = €0.69)

Check out Doris de Guzman’s Green Chemicals Blog for views on sustainability issues

By: Stefan Baumgarten
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