EU will need African ethanol to meet targets: study

MIDRAND, South Africa (Reuters) - Imports of ethanol from Africa could become essential for the European Union (EU) to meet its 10 percent renewable energy target in gasoline for road transport by 2020, a study showed on Thursday.

Massimo Marletto, consultant for African biofuels trade association PANGEA, said that with the ethanol production in place at the moment, factories under construction and those planned, the EU would still have a deficit of 5-8 billion litres of ethanol by 2020.

"The EU would have to build between 40 and 62 new factories with an average capacity of 129 million litres of ethanol ... that's highly improbable," Marletto told a biofuels conference.

"A big part of this ethanol could come from Africa," he said, especially given the continent's preferential trade agreements with Europe over other ethanol suppliers like Brazil.

While Marletto's study focused only on gasoline, he said additional potential for African biofuels could come from the need to meet the same target for diesel, which now accounts for 60 percent of the EU's fuel consumption.

Africa's biofuels potential is largely unexploited due to a lack of political commitment, proper legislative frameworks and industry incentives, but industry analysts say biofuels could prove valuable for the continent if implemented properly.