Ethanol consumption set to rise as govt looks to increase rate of fuel blending

Food secretary Sudhanshu Pandey on Friday said the country’s fuel ethanol consumption is set to rise and the government is targeting the implementation of motor fuel blending at the rate of E20 (20:80 ethanol: gasoline) by the year 2024. Motor fuel blending of 20% will become mandatory from 2025, he said.

While delivering the inaugural addressing an event organised by the Indian Sugar Mills Association (Isma), he said that the government has come out with regulations for the automobile sector according to which, E10 (10:90 ethanol: gasoline) has already been allowed. By 2025, the 20% fuel blending target shall be achieved by using 17 million tonne of foodgrains, which is also surplus. This move will help farmers, industry and the environment. “Currently the country has 90 million tonne of foodstock in public stock holding. Many countries thought that stock is burdening the market. But during the Covid-19 pandemic, almost 60 million tonne of foodgrains were distributed free of cost to 800 million people. This helped the country fight Covid-19 pandemic in an effective way. Now India will be moving towards E20 target by using about 17 million tonne of foodgrains for ethanol production,” he said.

The country also intends to move towards flexifuel engines so that higher level of blending is permitted in the country, he declared. Pandey said that the automobile industry has been invited to bring in technology which is already available globally so that surplus foodgrains and sugarcane are used, providing relief to all stakeholders in the entire eco system.

Outlining India’s journey towards the use of ethanol, he said that a policy was made to divert excess production to ethanol production. “The industry came forward in a big way and last year 2 million tonne of sugar were diverted towards ethanol production. This year we hope to divert 3.5 million tonne and next year 6 million tonne of sugar will be reduced and diverted towards ethanol production. “India started this journey very late and the country was not sure about achieving a balance between sugar and ethanol. With our own consumption of 26 million tonne, we were producing 40-45 lakh tonne of surplus sugar every year,” he pointed out. With sugar prices remaining depressed, the impact was felt by farmers with delayed payments and mounting arrears.

Abhinash Verma, director general, Isma, stated that India has become a surplus sugar producer in the last 10 years. The country is expected to produce 31 million tonne of sugar in the 2021-22 season with an estimated sugar consumption of 26.5 million tonne and exports of 6 million tonne, he said. The closing balance as on September 30, is 7 million tonne, he added. To reduce surplus sugar, mills are diverting to production of ethanol and opting for exports, he said. With incentives coming from the government, the industry is targeting the production of 14 billion litres of ethanol by 2025 from 3.5 billion litres of annual capacity in 2018. The target is to divert 6 million tonne of surplus to ethanol by 2025, he said.