Ho Chi Minh City has announced a plan to make all government offices and state-owned companies switch to a locally-produced biogasoline product that has not been selling well.
Six months after it was introduced, the 5-percent ethanol blend E5 hardly left any impression among local consumers, who still prefer the popular 92-octane gasoline (A92) to the environmentally friendly alternative.
Tat Thanh Cang, vice chairman of the city, said it is going to order users of official vehicles to use the new fuel, local media reported.
“Only then can the city encourage more people to switch to E5,” he said, cited by Thoi bao Kinh te Saigon (Saigon Times).
He said the new customers will quickly raise sales of the biofuel, which are currently very low compared to the city’s total fuel consumption.
But it’s not clear when the order will take effect.
The city had 58 has stations selling E5 at the beginning, and it planned to add 115 by the end of June.
But a recent report from the trade department said only 55 stations are selling it.
E5 is now selling at VND20,050 per liter, only 1.6 percent cheaper than 92-RON.
While the government has not managed to set an attractive price, many stations have poorly promoted the new fuel. They were not willing to invest in new gas pumps suitable for E5 as they were afraid that it would not pay off.
Representatives from major retailers like Saigon Petro or PVOil said at a recent conference that the consumption remains low as the city government still gives sellers and consumers a choice.
They said when most gas stations are selling both E5 and 92-RON, the biofuel product will not be able to compete with the other.
They said the city should make the stations sell only E5, like some provinces in the central region.