As the government aims to boost ethanol production, the industry is seeking an increase in ethanol prices and a stable long-term policy on ethanol blending. The government views the ethanol blending programme as crucial for meeting green energy commitments and enhancing the financial stability of sugar mills.
Speaking to ChiniMandi, Dr. Rahul Kadam, Chairman and Managing Director of Udagiri Sugar, emphasises the need to raise ethanol prices to support biofuel production. He stated, “We urge the government to revise the ethanol procurement prices for various feedstocks used in ethanol production, considering the fair and remunerative price (FRP) of sugarcane. An increase in prices will not only boost ethanol production but will also improve the financial health of sugar mills, allowing them to settle cane dues more quickly and smoothly.”
Currently, ethanol produced from cane juice is priced at Rs.65.61 per liter, while ethanol from B-Heavy and C-Heavy molasses is priced at Rs.60.73 and Rs.56.28 per liter, respectively.
He stressed the importance of transportation rates, advocating for an increase, and called for a long-term ethanol policy from 5 to 7 years to support and encourage ethanol producers. These measures will help sugar mills reach the 20 per cent ethanol blending target by 2025.
In August, ethanol blending in petrol reached 15.8 per cent, with cumulative ethanol blending from November 2023 to August 2024 hitting 13.6 per cent.
Recently, the government allowed sugar mills and distilleries to manufacture Rectified Spirit (RS) and Extra Neutral Alcohol (ENA) from sugarcane juice and B-Heavy molasses. Additionally, the government has permitted the production of ethanol from sugarcane juice, B-Heavy molasses, and C-Heavy molasses during the Ethanol Supply Year (ESY) 2024-25. It has also lifted a previous ban, allowing the sale of up to 23 lakh tonnes of rice from Food Corporation of India (FCI) stocks to grain-based ethanol distilleries.
According to the Department of Food & Public Distribution (DFPD), India’s ethanol production capacity has risen from 518 crore liters in 2017-18 to an impressive 1,623 crore liters in 2023-24 (as of August 31, 2024), demonstrating the government’s commitment to fostering a greener future.
