As India looks around at anything from electric vehicles to green hydrogen in its quest to reduce dependency on petroleum products as well as clean up its act in the countdown to Net Zero carbon footprint (India has set its target as 2070), could ethanol be the quick fix to the current scenario? Many believe so.
The government is amongst the believers, leading from the front. Having achieved 15% ethanol blending with petrol, the Modi government had announced recently that it will advance the target for taking the blend percentage to 20% from 2030 to the coming year.
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“The country has traditionally depended on oil imports to meet its growing energy demands. This reliance not only poses challenges to energy security but also leads to a substantial outflow of foreign currency. However, with ethanol blending, India has a promising opportunity to reduce its dependence on imported oil while addressing environmental concerns,” said the government statement.
Ethanol is essentially renewable fuel made from various plant materials, collectively known as ‘bio mass’. It also contains ethyl alcohol, the same that’s used in alcoholic beverages, but is used mainly at motor fuel. Blending ethanol into petrol often helps in an increase of the fuel's octane and get engines to run better by cleaning them and preventing build-up of deposits.
In India, ethanol is produced primarily from sugar, considering their widespread availability. The ethanol blend programme was started in 2001 but had inched forward slowly for years, until Nitin Gadkari, an unabashed champion of ethanol usage, took over as transport minister.
“By blending ethanol with petrol, India not only reduces its foreign exchange outflow but also cuts down on vehicular emissions,” said Pinaki Mukherjee, CEO of Zuari Envien Bioenergy. “The government’s decision to advance the target for 20% ethanol blending (E20) in petrol to 2025 demonstrates the country’s commitment to cleaner energy alternatives. While this transition brings immense opportunities, it also poses several challenges that require strategic interventions to ensure long-term viability.”
Prices are a big pain point. While the procurement price for ethanol does not match with that of feedstocks like rice and maize, the falling price of byproducts of the distilleries make the business unviable. This week, faced with massive excess of rice stocks, the government had tried to offload them to ethanol makers, but it found no takers, the manufacturers finding the price too high to afford.
"Simultaneously, investments in storage infrastructure, multimodal transportation, and blending facilities are critical to overcoming logistical bottlenecks and ensuring smooth supply chain operations," added Mukherjee.
But the government is already looking way into the future. At a recent conference in Delhi, Hardeep Singh Puri, union minister of Petroleum and Natural Gas said that the government has already begun planning for the future by exploring goals beyond the 20% ethanol blending target.
