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In a significant move towards sustainable energy, the Indian Government has announced the advancement of its ethanol blending targets. The National Policy of Biofuels-2018, which initially set a goal of 20% ethanol blending in petrol and 5% biodiesel blending in diesel by 2030, has been revised to achieve these targets by the Ethanol Supply Year (ESY) 2025-26.
Minister of State in the Ministry of Petroleum and Natural Gas, Rameswar Teli, in a written reply in the Rajya Sabha today said that "The decision comes on the heels of a successful seven-year performance under the Ethanol Blending Programme. An inter-Ministerial Committee’s Roadmap for Ethanol Blending in India 2020-25 estimates that 1016 crore litres of ethanol will be required to meet the 20% blending target in ESY 2025-26".
India’s current ethanol production capacity stands at 1364 crore litres, with significant contributions from the surplus states of Uttar Pradesh, Maharashtra, and Karnataka. This capacity is deemed sufficient to meet the revised blending targets.
Oil Marketing Companies (OMCs) have already achieved 10% ethanol blending during ESY 2021-22 and 12% during ESY 2022-23, indicating steady progress towards the goal.
Since 2014, the Government has implemented various measures to support the ethanol blending targets. These include the expansion of feedstock for ethanol production, an administered price mechanism for ethanol procurement under the Ethanol Blended Petrol (EBP) Programme, a reduced GST rate of 5% on ethanol for the EBP Programme, and amendments to the Industries (Development & Regulation) Act to facilitate the free movement of ethanol across states. Additionally, an interest subvention scheme has been introduced to enhance and augment the country’s ethanol production capacity, along with regular Expressions of Interest (EoI) floated by Public Sector OMCs for ethanol procurement.
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