By 2014 that percentage will increase to reach 5%. The progress in increasing the presence of ethanol in the fuel used by motorists will continue, reaching 7% in 2015, and 10% in 2016.
The biofuel will initially be produced by the company Campos de Pesé, from sugar cane grown in 5,000 hectares specifically for ethanol production, so that there will not be changes in the market for sugar and alcohol for human consumption.
Another option for the production of ethanol is a type of yucca unfit for human consumption, which European companies already have experience with and have shown interest in getting into the Panamanian market.
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The sugar industry wants the government to pass legislation to mix ethanol into automotive fuel.
The initiative is being promoted by the Sugar Association of Guatemala (Azasgua), The Local Alcohol Productive Arrangement (APLA) and the Brazilian Agency for Promotion and Investment.
The country's ethanol producer has stopped supplying the additive to fuel distribution companies.
Extract from resolution 2188 issued by the National Secretariat of Energy and published in the official newspaper of Panama, La Gaceta:
....that the company Campos de Pesé SA, the only company producing anhydrous ethanol used for blending with gasoline, has suspended sales of this product to importing companies - distributors of fuels, which creates a situation of shortage of anhydrous ethanol for blending with gasoline.
The new Panamanian Biofuels Act provides that from April 2013 a 2% of anhydrous bioethanol be incorporated into motor fuels.
Under the law, that percentage will increase to 5% by 2014. The progression in the increased presence of ethanol in the fuel used by motorists will continue to reach 7% in 2015 and 10% in 2016. This percentage may be increased by the National Energy Secretariat based on the technological advances.
The Panamanian government has delayed until next September using anhydride ethanol as an oxygenate additive in gasoline, which was planned to start in April.
The proposed amendments to Law 42 of 20 April 2001 on establishing the guidelines for a national policy on biofuels and energy was presented by the Minister of the Presidency, Roberto Henriquez, who was assisted by Vincent Prescott, Energy Secretary.