THE FUTURE of bioethanol as an alternative to petrol is in doubt after one of the main suppliers expressed doubts whether it will ever prove commercially viable.
Just three years after it introduced a blend of ethanol and petrol suitable for "flexifuel" vehicles, Maxol says Ireland is at a "significant crossroads" in relation to the uptake of biofuels.
Sales of flexifuel cars have slumped since changes were made to Vehicle Registration Tax (VRT) rules last July. As a result, sales of the bioethanol mix that powers these cars have stagnated, according to the company, which has expressed its worries about the viability of the product in a letter to the Minister for Finance.
In the letter, Maxol chief executive Tom Noonan appealed to Mr Lenihan to reintroduce measures to stimulate sales of flexifuel cars in tomorrow's budget.
He said the new VRT and road tax measures had proved very effective in steering customers towards lower CO2-emitting vehicles.
However, they had also had the effect of discouraging the purchase of flexifuel cars, because no account was taken of the environmental benefit of E85, a blend of 85 per cent ethanol and 15 per cent petrol. VRT on flexifuel is now up to 40 per cent higher than on diesel equivalents.
"Maxol believes that we are at a significant crossroads in relation to biofuel uptake. We have to ask ourselves, as a company, will it ever become a commercially viable product, and the answer to this question lies in the ability of our country to get sufficient flexifuel cars on Irish roads."
Biofuels have declined in popularity over the last year as concerns grow over world food shortages, caused in part by farmers growing fuel crops instead of food.
Much of the bioethanol supplied by Maxol comes from Carbury Milk Products, which manufactures it from whey, a milk derivative and a by-product of its cheese manufacturing operations.
Ford was the first carmaker to provide a flexifuel option in Ireland in 2005 and Volvo and Saab now also sell flexifuel cars. Manufacturers claim a 70 per cent reduction in CO2 emissions over ordinary cars.
