Any solution for gasoline E5?

E5 has been talked about a long time, but has only been used for mass nationwide two-month high. Last month, the Ministry of Industry and Trade said that the number of users this kind of gasoline is rising rapidly, but recently a business in the industry recommendations for using back gas mineral RON 92 (called A92) if there is no possible solution exam E5 boost purchasing power. 

E5 problem is not necessarily the selling price, which lies in the psychology of consumers. Photo: Thanh Hoa

Not as expected 

Company Limited Oil City. Ho Chi Minh (Saigon Petro) has repeatedly sent written recommendations concerning the trading and use of RON 92 petrol E5 (called E5) for the Industry and Trade Ministry and the Finance Ministry. This time, in Document No. 452 / CV-DK-Dealers, dated 07.03.2018, SaigonPetro propose some content related to environmental protection tax (LEP) and development policies biofuel E5 on the market in the coming period.

Specifically, Saigon Petro suggested MOIT same synthetic Finance Ministry data on consumption E5. If you find that the consumption is low, should have the necessary measures to encourage consumers to use E5, and assist traders in trading systems petroleum, especially the major businesses are investment E5 blending system scale.

Represented Saigon Petro said that if the goal of environmental protection (according to the deployment plan E5) proposed not reach, buying less, difficulties in implementation … should be back selling A92 as normal.

Currently, motorbikes, cars need to use 92 RON gasoline remains. The vehicles do not need to use petrol RON 95. Thus, if only because not use E5 that consumers purchase gasoline A95 extra money it costs extra monthly cost.

Nguyen, house in District 2, HCMC. Ho Chi Minh said previously he would dump the car A92 Super Dream. Many gas stations are not selling anymore A92, A95 gasoline he passed. Although sales staff recommend pouring gasoline E5 for cheap, he said, because not accustomed to this kind of gasoline.

In the petition, Saigon Petro guide data on output A92 average consumption from 2017 and earlier are approximately 6,000,000 m3 / year, equivalent to 500,000 m3 / month. If E5 petrol consumption by 50%, only A92. So there will be more people switch to gasoline A95.

Those in the industry calculations, with the price gap between E5 and gasoline A95 on the market today is VND1,600 / liter, the amount due to the delivery vehicles used gasoline A95 (to replace A92) estimated 400 billion / month (250,000 m3).

In fact, output E5 RON 92 gasoline consumption in the first two months of 2018 is still low compared with the previous sales of A92. According to estimates by some major enterprises gasoline, the amount of E5 gasoline consumption accounts for about 30% of the total volume of gasoline sold, some gas stations sell only gasoline A95, not sell E5. While A92 previously accounted for more than 65%.

How to increase? 

In the petition, Mr. Tran The Communications, General Director of Saigon Petro, said that besides increasing the EPT gasoline mineral RON 95 from VND3,000 / liter to VND4,000 / liter, the industry also needs to consider reducing EPT for E5 down 500 dong / liter, or EPT for E5 calculated according to the proportion of ethanol as present. The objective of this solution is to create retail price differentials between E5 and 95 RON gasoline mineralization approximately 2,000-2,500 VND / liter.

According to him, the price is lower than gasoline E5 have minerals, consumers switch positive new use to reduce monthly costs refuel. Currently, petrol A95 is priced at 19,980 dong, while E5 is priced at VND 18,340, VND 1,640 difference (in price date 13/3).

This is also a peaceful solution for both parties, does not reduce the budget revenues (tax increases for petrol and mineral LEP) but encourage consumers to use E5 to protect the environment. Those who use 95 RON petrol and minerals will have to accept higher gas prices.

With current regulations, the EPT for fuel level VI emissions standards for fuel level II is equal. Currently, EPT of E5 with equal diesel oil (VND1,500 / liter). That has led to price E5 can not lower than petrol and minerals, not to attract the attention of consumers.

Earlier, the petroleum enterprises to propose necessary incentives, apply EPT for clean fuels (higher emissions standards), Biofuels / E5 lower than the low fuel standards. For example, can apply environmental taxes for E5 and E10 biofuel respectively by 80% and 70% compared to gasoline tax rate of mineralization.

It is argued that this is a proposal tied to the interests of consumers. In principle, businesses selling E5 gasoline or petrol A95 are also profitable, even when moving through A95 petrol they have better profit margins.