Biofuel Market Promotion Law

The Law's primary objective is to incentivise the diversification of the fuel industry by promoting investment in the production of biofuels, defined as any chemical fuel type originating in agricultural products to a standard defined by the national government. The policies defined in the legislation, to be implemented by the executive branch, are: - to strengthen the scientific research system necessary to developing biofuels - to educate workers about innovative fuel technologies - to incentivise the application of biofuel technologies - to incentivise private capital investment in biofuel production - to incentivise the commercialisation of biofuels - to promote the production of biofuels in rainforest regions within the framework of sustainable development The Law outlines co-ordination with anti-drug programmes, so that national and interna-tional funds designated to The War on Drugs are used to incentivise farmers to cultivate crops designated for biofuels rather than production of coca plants. The legislation calls for the creation of a technical commission, which will create quality standards related to the production of various biofuels. The executive authority issued a decree to regulate the Law nearly two years after its promulgation. The Decree offers further legal definitions of terminology (such as biodiesel, denaturised chemical compounds etc.) as well as specifying the chemical make up of commercialised biodiesel (95% gasoline, 5% biodiesel) and ethanol fuel (92.2% gasoline, 7.8% ethanol). Additionally, the Decree identifies different funding streams to accomplish the legislative objectives established in Law No. 28054, including through the National Clean Development Mechanism, government-backed credits and funds designated for The War on Drugs.The Act No. 32.276 modifies Articles 2, 3, and 4 of Peru’s Law 28054, expanding the legal definition of ‘biofuel’, now requiring that such fuels be derived from biomass through low-carbon technologies and meet established environmental and social sustainability criteria over their lifecycle, as well as comply with nationally mandated quality standards. The amendment further refines the state’s policy architecture by directing the Executive to incentivise private-sector participation in biofuel production. It mandates the promotion of biofuel use (whether pure or blended) across all economic sectors, and specifically encourages biodiesel production in suitable areas of the Amazon region, provided it occurs within sustainable alternative development programmes and adheres to technical quality norms.