The government is to develop a number of new crop bases by 2010 to provide sufficient biomass resources to meet the country's growing demand for ethanol, the Ministry of Agriculture has said.
According to its Agricultural Biofuel Industry Plan, released yesterday, the bases will mostly grow sugarcane, sweet sorghum, cassava and rape for use in the production of both ethanol and biodiesel.
The plan rules out the expansion of grain-based ethanol production, specifically corn and potato-based, to avoid any detrimental impact on the food sector.
According to the plan: "The total production of biomass energy from non-grain crops will grow to 500 million tons of coal equivalent, worth some 3 trillion yuan, which will account for 24 percent of the nation's total energy consumption."
Of all the non-grain ethanol resources, sweet sorghum is a favorite among agricultural experts due to its low cost and the fact it can be grown on non-arable land. Under the plan, a total of 3.8 million tons of ethanol will be produced annually from the stalks of the sweet sorghum.
The plan proposes to integrate sweet-sorghum-based ethanol products into the current oil sales system, a privilege so far reserved for grain-based ethanol products.
Nine provinces - Heilongjiang, Jilin, Liaoning, Jiangsu, Shandong, Henan, Anhui, Hubei and Hebei - currently have gas stations that offer fuel mixed with 10 percent ethanol. The number of provinces is expected to grow this year as ethanol output is increased.
The country's four existing State-approved ethanol plants, which produce some 1.2 million tons per year, are located in the corn and maize production centers of Heilongjiang, Jilin, Anhui and Henan.
Like the many unlicensed producers, the plants mostly use corn.
However, the rapid expansion of corn-based production has had a huge impact on corn prices and last year spurred fears of possible food shortages.
"The new investment is likely to be in plants that produce ethanol without competing with grain supplies or taking up arable land," Zhou Dadi, former director of the energy research institute of theNational Development and Reform Commission, said.