Projection

Japan’s government has extended its biofuels mandate, keeping the annual target of 500 million liters of oil equivalent of biofuels to be blended with conventional fuels until the end of the fiscal year (FY) 2027/2028. Moreover, starting from FY 2028/2029, the government mandates the addition of 10 million liters of advanced bioethanol, including cellulosic ethanol.

However, the cost to produce advanced ethanol is significantly higher than that of conventional bioethanol produced from starch or sugar. Thus, SGS INSPIRE projects the annual volume target for advanced ethanol will remain at 10 million liters of oil equivalent.

Moreover, Japan’s petroleum industry prefers to blend bio-ethyl tert-butyl ether (bio-ETBE), rather than blend bioethanol, directly into gasoline. This is prim