'Mandatory blending to ease import bill'

HARARE - New regulations making it mandatory for oil companies to sell blended petrol will help ease the country’s fuel import bill, the Zimbabwe Energy Council (Zec) says.

According to Statutory Instrument (SI) 17 of 2013 published this week, fuel dealers are compelled to blend petrol with five percent of locally-produced ethanol.

Zimbabwe spends $45 million a month on importing 30 to 40 million litres of petrol.

Zec said the decision by government will save the country between 1,5 million and 2,5 million litres — equivalent to $2 million every month.

“While Zimbabwe Energy Council would have been comfortable with a 10 percent mandatory blending, we believe that this is a strong starting point and will fully support government in this regard,” said Zec executive director Panganayi Sithole.

“What is now very key and strategic is the immediate implementation of this statutory instrument so that the plant will start operating,” he said adding that it was very key that all stakeholders co-operate to enable the resumption of operations at Chisumbanje.

With Billy Rautenbach’s multi-million dollar Chisumbanje ethanol project stopping operations last year due to policy fights in government, there is also huge feeling that the move to legislate for the tycoon’s project creates a monopoly.

Sithole said Energy minister Elton Mangoma must take a leading and decisive role in the implementation of the Statutory Instrument.

“Hopefully, the over 2 000 employees that were laid off will be recalled as a matter of urgency,” said Sithole adding “we believe that the benefit of this decision will trickle down to the motorists on the road, who will cumulatively enjoy significant savings.”

Zec says government should also authorise the introduction of 20 percent and 85 percent blends, albeit on an optional basis.

Witness Chinyama, an economist, said the new regulations would free funds for other projects of national interest.

“Mandatory blending will have a positive effect in that it will reduce the price of fuel and Zimbabweans will benefit in the long-term,” he said.

The country has been battling an acute liquidity crisis since the introduction of a multi-currency system — dominated by the United States dollar — early 2009.

Mangoma said the new regulations will assist in saving “the country and the planet while at the same time we are creating our own industry.”

“We are going towards a green economy and we are talking of biofuel,” he said.

According to the new regulations no person other than a licensed ethanol blender shall blend anhydrous ethanol with unleaded petrol.

The law also restricts the procurement of the ethanol from only licensed producers.

“No licensed ethanol blender shall blend anhydrous ethanol with unleaded petrol except at a facility specified in the blender’s licence,” read part of the regulations.

Producers will also be required to make submissions to the Zimbabwe Energy Regulatory Authority (Zera) specifying that the ethanol used is compliant with set standards.

They will also provide monthly returns on the volume of ethanol produced and to whom it was sold and the quantity sold to each of them.

The blenders are also equally expected to provide Zera with weekly returns on the volumes and names of the source of the ethanol used.

Such records should be readily available when required by Zera officials.

“Those found in contravention of the regulations shall be liable to a fine not exceeding level nine and the Criminal Procedure and Evidence Act (Chapter 9:07) shall be applicable for any offences committed,” the law says. - John Kachembere

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