In 2021, ASEAN contributed to a significant chunk of the world’s biofuel supply, with Indonesia producing 137,000 barrels per day of biodiesel, exceeding the United States and Germany. Other than being an export commodity, biofuel is needed by other major producers like Malaysia, the Philippines and Thailand to support their domestic energy demand and economic growth.
ASEAN Member States have also recognised biofuel’s potential to decarbonise energy systems. To date, five countries have enacted blending mandates – Indonesia with B40 (40 per cent palm-based biodiesel content) by 2030 and E50 (50 per cent ethanol content) by 2050, Malaysia with B20 and E10, Thailand with B20 and E85 and with a target to reach 20 to 25 per cent biofuel share in total energy demand by 2037, the Philippines with B10 by 2040 and E20 by 2040, and Vietnam with B10 and E10 to achieve 25 per cent share in transport sector’s fuel demand by 2050.
Nonetheless, with the rising attention to electric vehicle (EV) development, many question the merits of switching to biofuel over pushing for EVs, considering factors such as affordability, sustainability and supply chain readiness. However, pursuing both biofuel and EV might be the most practical option for Asean, if it is to curb emissions quickly in a way that cost the least.
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