Guatemala has started a nationwide programme requiring petrol to contain 10% ethanol, creating a new export market for US ethanol and making it the first Central American country to introduce a mandatory E10 blend, the US Grains & BioProducts Council (USGBC) said.
The programme began on July 1, more than 40 years after Guatemala passed its Fuel Alcohol Law in 1985. Under the new rules, all petrol sold in the country will have to contain 10% ethanol, Ethanol Producer Magazine reported.
The fuel supply chain is currently undergoing an initial adjustment period, which is scheduled to end on August 21, when E10 is expected to reach petrol stations nationwide. US ethanol shipments have already arrived to support the launch.
Guatemala uses about 1 billion gallons of petrol a year. The E10 requirement is expected to create demand for about 100 million gallons of ethanol annually. USGBC estimates that US producers could supply 70 million to 100 million gallons a year, worth between $154 million and $220 million.
The programme is also included in the US-Guatemala Agreement on Reciprocal Trade, which identifies ethanol as a potential area for trade and refers to purchases of at least 50 million gallons of US ethanol each year.
The country had enacted its biofuel law in 1985, but implementation was delayed for decades by political, economic and technical obstacles and the lack of regulations needed to put the law into effect.
USGBC said it helped develop the programme by providing studies on the environmental, health and economic effects of ethanol blending, as well as technical support on fuel standards and market rules.
The council also arranged visits for Guatemalan government officials and industry representatives to the United States to study the ethanol sector. It worked with the Inter-American Institute for Cooperation on Agriculture and the Latin American Energy Organization to provide biofuel training and strengthen technical skills among officials.
In March, USGBC held a regional biofuels seminar in Guatemala City attended by Guatemalan President Bernardo Arévalo and US Agriculture Department Under Secretary for Trade and Foreign Agricultural Affairs Luke Lindberg.
The council expects the programme to encourage other countries in Central America and the Caribbean to adopt similar policies. Costa Rica, Panama, El Salvador, Honduras and the Dominican Republic are considering or developing ethanol blending programmes.
USGBC said it invested about $200,000 over three years through US agricultural promotion programmes to support Guatemala’s E10 rollout. It estimates the programme could generate about $160 million in annual US ethanol exports, or roughly $800 in export sales for every dollar invested.
