The Department of Energy has released a circular in June that sets biofuel standards, requiring oil companies to use and sell coco methyl ester conforming to government regulations. This circular intends to "ensure the integrity of the products for retail" by requiring oil companies to "adhere to good housekeeping protocol particularly with regard to handling, storage, and dispensing of biofuel blends.

Only qualified entities will be allowed to import unblended or base diesel. These entities will also need to secure an energy department clearance after proving that they are fit to mix import unblended diesel with the required biofuel component. The circular was issued in preparation for the implementation of the Biofuels Act of 2006. The law seeks to reduce dependence on imported fuel with due regard to the protection of public health, the environment and natural ecosystems consistent with the country’s sustainable economic growth that would expand opportunities for livelihood. It also intends to mitigate toxic and greenhouse gas emissions and increase rural employment and income. It ensures the availability of alternative and renewable clean energy without any detriment to the natural ecosystem, biodiversity and food reserves of the country.

The Act also mandates that within two years from its effectivity, all liquid fuels for motors and engines sold in the Philippines shall contain locally-sourced biofuels components of at least five percent bioethanol in the annual total volume of gasoline fuel actually sold and distributed by each and every oil company in the country.
Biofuel refers to bioethanol and biodiesel and other fuels made from biomass and primarily used for motive, thermal and power generation with quality specifications in accordance with the Philippine National Standards (PNS).