Government has increased the mandatory blending ratio of unleaded petrol from 10 percent ethanol to 15 percent with immediate effect following significant improvement in supplies of ethanol from Green Fuel.
The move is likely to see a decrease in the pump price of the blend which is currently pegged between $1,46 and $1,53 per litre, depending on location.
Energy and Power Development Minister Dr Samuel Undenge announced the new ratios in a Government Gazette published yesterday.
“It is hereby notified that in terms of section 4(1) of the Petroleum (Mandatory Blending of Anhydrous Ethanol with Unleaded Petrol) Regulations, 2013, published in Statutory Instrument 17 of 2013, as amended by Statutory Instrument 81 of 2014, the Minister approves the current level of mandatory blending to 15 percent,” reads part of the gazette.
“The blending of ethanol and unleaded petrol at E15 is now sustainable because there is now adequate supply of ethanol to sustain blending at the 15 percent level.”
The blending ratio was reduced from 15 percent to five percent in December last year due to low sugar cane supplies from Green Fuel, which is the country’s sole ethanol supplier.
This was after the company faced challenges in harvesting the cane due to water clogging.
Green Fuel is a joint venture between the Government through arda and two private investors Macdom and Rating.
Arda board chair Mr Basil Nyabadza is on record as saying the company was keen to reach 20 percent ratio before the end of this year.
Green Fuel initially projected that by 2018, it would have completed the construction of Kondo Dam, which is worth $300 million and also employ 36 500 people.
It is no longer certain if Green Fuel would be able to sustain the demand of ethanol after it emerged that there is a mass exodus of employees at the company due to erratic payment of salaries.
Sources said the company owes its employees salaries for the past six months.
As a stop gap measure, Government last year, contracted Triangle to temporarily supply ethanol after Green Fuel failed to meet the increasing demand on the market.