The long-awaited biofuels policy document should be finalised by the end of October, Department of Minerals and Energy chief director of clean energy Sandile Tyatya said on Monday.

Tyatya noted that the document had been discussed and reviewed by the inter-ministerial committee on biofuels, and would be presented to Cabinet in the next two weeks.

He added that, at this stage, the plan for the sector was “a broad policy document”, but that there was a potential view to legislate the sector in future.

Tyatya said that, owing to the “array of comments” that had been received in response to the document, the process had taken longer than expected.

The policy was initially expected to be finalised in May this year.

The wait for the policy document, and particularly confirmation of the support to be provided by government for the sector, has made certain industry participants hesitant to invest and move forward with biofuels projects.

However, this has not been the case for all the companies involved in the sector.

Black-empowered firm Siyanda Biodiesel is proceeding with preparations for the development of a soya bean-based biodiesel production plant, despite continued policy delays.

CEO Madi Ramsamy said that Siyanda had secured a supply of soya bean seed from New Crop Seed, and was planning to plant the first crop in October, near Newcastle in KwaZulu-Natal.

The project includes the development of a proposed 100 000 t/y soya bean-based biodiesel plant valued at between R1,2-billion and R1,3-billion. It includes the construction of the soya bean processing plant, an oil cake manufacturing facility, an oil extraction facility and a biodiesel refinery.

The project, should it go ahead, will be a joint venture (JV) between petrochemicals giant Sasol, the State-owned Central Energy Fund and Siyanda.
Siyanda has also secured contracts for the supply of fuel and fertiliser for the farms.

However, Ramsamy said that JV partner Sasol wanted to delay the project until a policy was in place. Sasol's widely reported standpoint is that a biodiesel plant in South Africa is not economically viable without government support.

Engineering News reported in July that the project would be decided on by Sasol's board after government's national biofuels sector strategy document had been published, and Sasol confirmed that in the absence of a finalised policy document a decision is yet to be made.

Ramsamy agreed that government support was critical for the development of the industry. In a telephonic interview, he noted that he would like to see support in the form of agricultural or crop subsidies that would promote local emerging farmers.

Ramsamy said that Siyanda wanted to use local feedstock, and that he would like to see government assist farmers by lowering their input costs, such as seed, fertiliser and fuel, through subsidies.

These cost reductions would ripple through and also benefit buyers of the feedstock, such as Siyanda.

Despite previous delays, Ramsamy was optimistic that the policy would be in place by October.