The cities include Zhengzhou, Luoyang and Nanyang in Central China's Henan province, and Harbin and Zhaodong in Heilongjiang Province, in Northeast China.

From June 8 in Zhengzhou, capital of Henan, all motor vehicles with licence plates starting with "Henan A" have been required by the municipal government to use ethanol-based fuel. Motorcycles, military vehicles and vehicles in transit from outside the city are exempted.

The pilot programme has been approved by the State Economic and Trade Commission and the State Development Planning Commission.

Under the program, Henan is introducing the use of ethanol-based fuel across the province by the end of this year.

Officials say the move is of great importance in helping stabilize grain prices, raise farmers' income and reduce fossil fuel pollution.

Ethanol fuel is produced by the Tianguan Group Company, which has a plant in Henan with a production capacity of 200,000 tons of ethanol a year, and another plant in Heilongjiang.

A third plant is under construction in Jilin Province, Northeast China, which will have a production capacity of 800,000 tons. All three plants produce the fuel from corn.

Zhang Xiaoyang, general manager of the Tianguan Group, said the three plants are expected to consume several million tons of corn each year, as it takes three tons of grain to produce one ton of ethanol.

China consumes 36 million tons of petrol each year.

Officials say ethanol-based fuel will be promoted in many big cities in coming years.

An official with the State Development Planning Commission said the use of ethanol-based fuel made from grain would create a long-term, stable and controllable grain market for the country.

(Xinhua News Agency June 24, 2002)