Iran plans to produce bio-ethanol, an environment-friendly fuel that has the potential to provide impressive engine performance results.

An Iranian official has revealed that the oil ministry is to sign an accord in this regard with the Iranian association of ethanol producers.

"The project to produce bio-ethanol is to start in the next three months," said the head of National Iranian Oil Products Distribution Company, Ali Ameri.

Agricultural residues have not commonly been used for energy application, which includes the production of biofuels in Iran.

According to Ameri, bio-ethanol production in Iran -- which is expected to start in a year's time -- can be considered an important step toward a greener environment.

Around 17.86 million tons of wasted crops are being produced each year in Iran. Any kind of fuel made from living things, or from the waste they produce, is named a biofuel.

Bio-ethanol, an alcohol, is usually mixed with petrol while bio-diesel is either used on its own or in a mixture.

Iran's Parliament (Majlis) voted recently against the allocation of any subsidy for imported gasoline. Based on the parliamentary decision, the imported gasoline must be sold at market price.

Ameri denied Tuesday reports claiming that subsidies have been allocated for gasoline imports.

"We are not responsible for providing the budget needed for gasoline imports. The oil ministry will make the decisions in this regard and we will import gasoline on the ministry's behalf," Ameri said.

MVZ/SC/AA