Le Van Tam, Chair of LSS, said that in the 2010-2011 crop, the turnover from alcohol production reached 300 billion dong, or 9.6 percent of the total turnover.

 However, Tam admitted that the turnover from the plant remains too modest, which is does not correspond to the heavy investment. While the company earned 300 billion dong from alcohol production, it had to pay 100 billion dong to treat the environment.

 Besides LSS, the Quang Ngai, Hiep Hoa and Tuy Hoa Sugar Refineries have also invested hundreds of billions of dong in the alcohol making technology. However, like LSS, the turnover from byproducts is not high enough to cover expenses. As a result, Quang Ngai and Hiep Hoa have to stop the plants or keep the plants’ operation at moderate level.

 Nguyen Thanh Long, Chair of the Sugar Cane and Sugar Association, who is also the manager of the Can Tho Refinery, admitted that this is the weak point of the Vietnamese sugar industry.

 According to Long, generally, the byproducts collected from the sugar refinery, can bring the values higher than the values brought by the main product – sugar. For example, bagasse can be used as fuel to create electricity, make pulp, or make board used in construction. Meanwhile, treacle can be used to make alcohol and ethanol, while some other byproducts can be used as fertilizer to improve the land for growing sugar cane.

 However, experts say, due to many different reasons, sugar refineries still can exploit 10 percent of the byproducts.

 Sugar industry needs mechanism applied to recycle energy sector

 According to Long, in the countries with developed sugar industry, like Brazil, sugar production is considered an energy industry, not a food industry like in Vietnam. Therefore, the governments apply reasonable policies with incentives given to enterprises to encourage them to exploit the values of byproducts.

 Tam said that currently, using biofuels (made of alcohol) remains not a must in Vietnam. This explains why 20 million liters of alcohol collected every year does not have stable sale. Therefore, it would be unprofitable for enterprises to spend hundreds of billions of dong to invest in plants like LSS.

 In general, a power plant which generates electricity from bagasse costs 1000-2000 dollars for every kw of installation, depending on the technologies. For example, a sugar refinery with the capacity of 3000 tons a day can have a 30MW electricity plant with the investment capital of 30-60 million dollars.

 Sugar companies cannot sell electricity at reasonably high prices. Nguyen Van Loc, General Director of the Bien Hoa Sugar Company said in other countries, the energy made of bagasse is considered a kind of renewable energy.

 In Vietnam, the Electricity of Vietnam (EVN), the only electricity wholesale buyer of sugar companies, does not think so, therefore, it only pays 4.4 cent per kwh. Meanwhile, EVN buys electricity from China at 7 cent. This does not encourage sugar companies to make heavy investment and upgrade equipments.

 “In the overall plan to develop power generation sources in 2006-2015, EVN does not mention the renewable energy from sugar plants,” Loc added.

 Source: SGTT