Ethanol-based fuel a top-seller in France

PARIS, France (Reuters) — Gasoline containing up to 10 percent ethanol has become the top-selling petrol in France, helped by a tax break that makes the crop-based fuel more attractive to drivers.

Sales of unleaded SP95-E10 accounted for 38.5 percent of total petrol sales in France in September, the Bioethanol Collective said in a statement.

That compared with 36.8 percent for SP95 and 23.6 percent for the higher-quality SP98.

Over the first nine months of 2017, SP95-E10 was also ahead with a share of 38.2 percent versus 37.5 percent for SP95.

The rise in demand for SP95-E10 in France contrasts with Germany, where sales of E10 petrol fell last year despite a price advantage due to concern it is not suitable for all cars, and with Britain, where it has not yet been introduced.

Since its launch in 2009 in France, SP95-E10 has widened its network to more than one in two petrol stations in the country, where it is four to five cents a litre cheaper than SP95 thanks to a tax incentive.

Ethanol, made from grain or sugar in France, has also benefitted from French drivers’ distrust of diesel after Volkswagen’s emissions test cheating scandal.

Registrations of petrol and diesel cars were nearly equal in France over the first 10 months of the year in a setback for diesel, whose market share was 8.6 percentage points ahead of petrol a year earlier, said the French car-maker association CCFA.

Demand for SP95-E10 in France was also boosted by an increase this year in the legal biofuel blending level in transport fuel to 7.5 percent overall from seven percent previously.

To meet this goal, fuel distributors were tempted to promote ethanol-rich and easy-to-use SP95-E10 instead of standard SP95 and SP98, which also contain ethanol but only up to five percent, or E85 — with 65 to 85 percent of ethanol — that requires specific engines or conversion kits.

Ethanol’s expansion is being threatened by a proposed change in European Union biofuel policy over concerns that biofuel could contribute to high food prices and indirectly cause deforestation.

The EU executive has proposed cutting by nearly half the use of crop-based biofuel, which includes ethanol, to a maximum 3.8 percent by 2030.

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