China seeks to promote the development of its biofuels industry through a series of supportive measures despite mass production difficulties. A spokesperson for the National Energy Bureau said that the Chinese government has set a goal of utilizing five million tons of ethanol fuel during the "12th Five-Year" period spanning 2011 to 2015, nearly double that set for the prior period (2006-2010).

While biofuel technology is already becoming increasingly sophisticated across the country, a lack of raw materials is restricting large-scale commercial application.

Biofuels are not only an alternative to petroleum but also a catalyst of economic growth. “The biofuels industry is an integrated system that can drive the development of a variety of other industries, including agriculture, chemicals, plastics, automotive, power generation, transportation and services while helping boost domestic demand, ” said Li Shizhong, deputy director at New Energy Research Center, Nuclear Research Institute, Tsinghua University. “Unlike other industries, biofuels help maintain social stability by addressing a number of agriculture-related issues, including increasing farmers’ income and creating jobs for millions of farmers.”

Li Shizhong also said that the Chinese government will give priority to the development of biofuels as an alternative to petroleum, which is part of its national energy development strategy, and take a number of measures to support the development of the biofuels industry.

The National Development and Reform Commission and the Ministries of Agriculture and Finance issued a plan for the comprehensive utilization of crop stalks for the 12th Five-Year period to promote the industrialization of cellulosic ethanol and increase stalk utilization to 30 percent. Industry analysts said that the policy has provided new opportunities for the development of the Chinese non-food fuel ethanol sector.

In 2011, imported petroleum accounted for over 55 percent of China’s total petroleum consumption. With the continued rise in international oil prices, the market for petroleum imports has faced many uncertainties due to the nuclear crisis in Iran and increased air pollution caused by exhaust emissions that harms human health. A 660-square meter sweet sorghum field is capable of producing about one ton of ethanol, while automobiles powered by biofuels reduce CO2 emissions by over 30 percent, added Li.

However, the mass production of sweet sorghum stalks, which are one of the principal raw materials of fuel ethanol, is difficult due to the lack of a comprehensive system for the collection, storage and transportation of the material. A series of supportive policies relating to the prices of non-food biofuels, tax discounts and fiscal subsidies are under consideration.

Li Shizhong suggested the government develop a roadmap for the biofuels industry based on technologies and economic feasibility: the production of first generation biofuels should be restricted, while the production of 1.5-generation and the development of second generation - cellulose ethanol - should be encouraged and accelerated. He also suggested the government expand the production of biofuels with production bases in Inner Mongolia and Xinjiang, two regions with substantial sunshine and heat resources suitable for the planting of sweet sorghum, as well as in the Bohai Rim Region, where a five million-ton fuel ethanol production base can be built in the region’s large saline areas.

Based on available information, a demonstration project using the ASSF ethanol technology developed by Tsinghua University has been established in Inner Mongolia. 

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