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Russian government to back 30 new biofuel plants

Ethanol & Biodiesel News
Volume XX, Number 17

Russian government to back 30 new biofuel plants

The Russian government will back the construction of 30 new plants to produce ethanol, Prime Minister Viktor Zubkov told a timber industry conference last month.

Zubkov announced the start of government program to develop biofuel production, which includes the construction of 30 new plants to make ethanol, as well as upgrading existing facilities, the Moscow Times reported. He also reportedly said that ethanol production in Russia will come to two million tons per year if the program is successful. However, he did not specify when he hoped to achieve the goal. Zubkov's comments followed President Vladimir Putin calling for Russia to establish a place among the world's top producers of biofuels.

In his State of the Union address last year, President Bush called for the U.S. to produce 35 billion gallons, or 98 million tons, of the fuels by 2017. The production of biofuels has significantly increased globally in recent years, provoked by rising oil prices. However, moving toward crop-based biofuels has driven up food prices worldwide, striking the poor and increasing inflation. Thus, Zubkov's comments had some conference attendees hoping the plans were aimed at developing fuels from wood waste instead of food crops.

Researchers are close to developing a technology to make fuel out of timber waste that will be as capable as the current conversion of crops into fuel, said Alexei Ablayev, director of the National Biofuel Association. About 30 Russian plants that produced ethanol from non-crop raw materials went bankrupt with the collapse of the Soviet Union because the technology made fuel too costly. Plans to redirect some of the country's crop harvests to make fuel should not increase bread prices because there is room to grow larger harvests, Ablayev told the Moscow Times. Russia has about 40 million hectares of unused arable lands, he said.

He also said that if ethanol production does gain ground in Russia, then it will focus on the export market for now. The government charges an excise duty of at least 26 rubles ($1.10) to sell 1 liter of ethanol, the same as for other types of spirits.

The tax alone is more than the cost of one liter of gasoline.

Date:  24.04.2008

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