Beijing, June 10:

China will restrict its ethanol and coal liquidification industries as part of efforts to address environmental pollution and realise sustainable development, state press said Sunday.

The State Council, China’s cabinet, has approved in principle a “long-term renewable energy development plan,” which calls for restrictions on developing the two energy sources due to their environmental impact, the Beijing Youth Daily said.

It was not immediately clear when the plan would be formally approved.

“The rapid development of grain-based ethanol biofuels has resulted in commodity price pressures in non-developed nations,” the paper said. China’s grain stores should be focused on feeding its 1.3 billion people and crop lands should reserved for food production, not energy production, it said.

The renewable energy plan would restrict China’s ethanol industry to producing fuel from non-grain sources, such as grasses, corn stalks or other plant by-products, it said.

China produced 1.54 million tonnes of ethanol in 2006.