May 10 (Renewables Now) - Brazil's minister of mines and energy, Moreira Franco, has signed a decree ensuring a 5% minimum participation of small biodiesel producers in public biodiesel auctions.
The new decree is aimed at stimulating the participation of small biodiesel plants and increasing competition in the sector. The maximum amount that can be awarded to small producers in auctions is 10%.
To encourage competition, the ministry also stated that the total volume purchased in each auction cannot exceed 70% of the total offered by the country's small producers. Among the criteria to take part in future competitions, small producer now have to bear the Social Fuel Seal.
The decree also contains safeguards in order to prevent tenders to have insufficient supply due to the output of small plants, thus avoiding harm to the market and the end consumer, the ministry noted.