updated 6/29/2006 8:14:38 AM ET 2006-06-29T12:14:38

Japan plans to fight global warming and surging oil prices by requiring that all vehicles on the road be able to run on an environment-friendly mix of ethanol and regular gasoline by 2030, an official said Thursday.

The new policy, adopted by the Environment Ministry this month, will require all new cars to be able to run on a blend of 10 percent ethanol, an alcohol fuel often made from corn or sugar, and 90 percent gasoline, starting in 2010, said Takeshi Sekiya, an official at the ministry’s global warming division. Costs and implementation are still being studied.

The switch to ethanol underlines the new urgency felt by industrialized countries trying to rein in the effects of greenhouse gases and reduce dependence on foreign oil.

Ethanol blends are already widely used in Brazil, and on Wednesday, U.S. automakers announced plans to double production of vehicles using the so-called flexible-fuel technology by 2010.

“The main goal is to counter global warming,” Sekiya said. “Adopting the new technology is not that difficult.”

Japan currently allows ethanol mixtures of up to 3 percent at the nation’s pumps, but in practice “almost no cars” run on the fuel, Sekiya said.

To encourage the market, the ministry will ramp up production of ethanol fuel on the southern island of Miyako, where a plentiful supply of sugar cane will be converted into fuel for the island’s estimated 20,000 cars in the next three years.

The goal is to have all cars on the nation’s roads capable of running on the new fuel by 2030.

By mixing in the plant-based fuel, scientists can reduce the harmful greenhouse gases churned out in vehicle exhaust — a top priority for Japan, which is the world’s second-large economy and a top air pollution offender, despite being a key driver behind to the Kyoto Protocol — an international agreement to cut global output of carbon dioxide by 2012.

Japan also imports nearly all its oil and is keen to find alternative energy sources.

Yet many obstacles remain to a smooth switchover, starting with the fact that ethanol fuel is more expensive than gasoline and contains about two-thirds of the fuel value. Japan’s goal of a 10-percent ethanol blend also falls short of the standards being met by U.S. automakers, which are already producing cars that can run on 85-percent ethanol blends.

General Motors Corp., Ford Motor Co. and DaimlerChrysler AG’s Chrysler Group have produced 5 million flexible fuel vehicles that can run on 85 percent ethanol. They are expected to produce an additional 1 million of the vehicles this year, and Wednesday’s new commitment would lead to 2 million annually by 2010.

While only a handful of cars in Japan are actually running on ethanol blends, all vehicles produced by Toyota Motor Co., the world’s No. 2 automaker, already meet the new 10-percent standard, Sekiya said.

The trial run on Miyako will help bring down production costs so the technology can be spread nationwide, he added.

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