According to a recent article on E85.whipnet.net, Peru’s governor, Cesar Trelles, predicts that northwest Peru will someday produce 400 million gallons of ethanol each year. While this represents only 7 percent of the ethanol sold in America in 2006, the demand for ethanol as an alternative fuel source is rising, growing 30 percent in 2006 and still climbing.
Peru’s favorable weather conditions allow for more ethanol production, and evolving environmental laws are also boosting supply. Many U.S. states require a blend of ethanol and gasoline; and many automakers are hinting that more vehicles in the near future will run on 85 percent ethanol, gasoline or a combination of the two. About four million of the “flex-fuel vehicles” are expected to be on the road by 2010.
Stratos Renewables (OTCBB: SRNW) is already banking on the future of ethanol. The development-stage company engages in the production, processing and distribution of sugarcane-based ethanol in Peru. The company’s interest in sugarcane is fueled by the increasing demand for ethanol, tax incentives and blending mandates sweeping the world.
To mention just a few of the current and upcoming mandates: in Brazil, gasoline is required to include between 20 and 25 percent ethanol; in Peru, effective 2010, 7.8 percent of gasoline must be ethanol; and in the United States, energy policies are expected to create a market for up to 7 billion gallons of renewable fuel by 2012.
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