I have been using E10 from a leading oil company for several months now. My car allows me great mobility and convenience but more importantly, I know that it emits less harmful pollutants to the environment.

Before E10, I used unleaded gas and maintained my car regularly to at least mitigate the emissions.

When E10 was introduced, I was attracted to its obvious benefits of being environment-friendly since less pollutants are emitted, better mileage and, of course, its cheaper price.

At the macro level, there was the added attraction of lessening dependence on imported oil, as well as creating livelihood opportunities for Filipinos since its components come from agricultural produce which can be planted locally like corn, cassava or sugar cane.

Very recently, Congress passed the Biofuels Act of 2006, the pioneering law on the use of alternative fuels. The Act provides for the mandatory use of biofuels. Hence, all liquid fuels for motors and engines sold in the Philippines must contain locally sourced biofuel components.

Within two years after the law is signed, the annual total volume of gasoline fuel sold and distributed in the country must contain at least 5-percent bioethanol from local sources.

The blend must be increased to 10 percent within four years.

For diesel, the bill prescribes that on effectivity of the Implementing Rules and Regulations of the Act, a minimum of 1 percent by volume shall be blended into all diesel engine fuels sold in the country, increasing to 2 percent within two years. The sale of biofuels shall be VAT zero-rated with the raw materials used such as coconut, sugar cane, cassava and corn.

The Act is expected to encourage investors to put up ethanol plants, thus creating new employment for our people. This will, in turn, increase the income of our farmers as the demand for their produce increases.

The ethanol wave happening not only in the Philippines but in the other countries as well has obvious benefits. I believe the more telling ones are finding alternate fuel to the depletable and nonrenewable sources of oil right now and reducing the environmental degradation caused by using traditional fossil-based fuels to power vehicles, manufacturing plants, power generators and other gas-fed machines which modern man cannot do without.

There is, however, a fly in the biofuel ointment, so to speak, that needs to be addressed. A recent University of Minnesota study argues that the rush into ethanol threatens to divert massive amounts of corn and other food crops into biofuels. This could have devastating effects on food prices and worsen world hunger.

Biofuels in the US are currently sourced primarily from corn and soybeans. The US government offers incentives to ethanol manufacturers using these crops. The study pointed out a World Bank information suggesting that caloric consumption among the worldís poor declines by about half of 1 percent whenever the average prices of all major food staples increase by 1 percent.

Given that governments that encourage ethanol production, including the Philippines, offer subsidies and incentives toward this end, this has the effect of pushing farmers into diverting massive amounts of corn, oilseeds and other crops into ethanol manufacture.

The study further asserts that with the prices of staple foods increasing because of the demand for biofuels, the number of food-insecure people in the world would rise by over 16 million for every percentage increase in the real prices of staple foods.

That means that 1.2 billion people could be chronically hungry by 2025ó600 million more than previously predicted.

It is said that the biofuel craze could push up corn prices 20 percent by 2010 and 41 percent by 2020. This could affect other crops, such as rice or wheat, since farmers are converting their fields to corn or other plants more profitable because of their potential for ethanol.

ìIn the United States, the growth of the biofuel industry has triggered increases not only in the prices of corn, oilseeds, and other grains but also in the prices of seemingly unrelated crops and products,î they said.

ìThe use of land to grow corn to satisfy the need for ethanol is reducing the acreage devoted to other crops. Food processors who use crops such as peas and sweet corn have been forced to pay higher prices to keep their supplies secure, costs that will eventually be passed on to consumers.î

The above arguments are just from one study but several others are available which support the points enunciated. In the same vein, tons of material can also be accessed in support of the biofuel direction. Notwithstanding the arguments for increasing ethanol production, it is agreed that production of alternative fuels should not be at the expense of sectors which may be negatively affected.

In this instance, a balance needs to be drawn to address the need for food to alleviate world hunger and hunger for fuel for the worldís machines.

Berino teaches at the De La Salle Professional Schools Ramon V. del Rosario Sr. Graduate School of Business. He welcomes comments at dennis.berino@dlsps.edu.ph. ìMirror Imageî is a rotating column featuring writers from the DLSU Professional Schools Inc.