Friday, 17 May, 2024
By: Yash Gupte
Nitin Gadkari announced that he will be launching Toyota’s Camry car in August which will run 100 percent on ethanol and also generate 40 percent electricity. Image Source: IANS
The Union Government has laid a major emphasis on the production of ethanol in the country and also blending it with petrol. The government has taken various steps in providing a boost to the ethanol production and ethanol production capacity in the country.
Speaking at an event in Maharashtra’s Nagpur on June 26, Union Minister for Road Transport and Highways, Nitin Gadkari said that India will soon witness new vehicles that will run solely and entirely run on ethanol. He said, “We are bringing new vehicles that will run entirely on ethanol. Bajaj, TVS and Hero scooters will run 100% on ethanol." "If you compare it with petrol, it will be Rs 15 per litre of petrol because ethanol’s rate is Rs 60, while the rate of petrol is Rs 120 per litre. Plus it would generate 40 percent electricity. The average would be ₹15 per litre,” he added.
Nitin Gadkari announced that he will be launching Toyota’s Camry car in August which will run 100 percent on ethanol and also generate 40 percent electricity. Earlier, speaking at a bio energy summit organised by the Confederation of Indian Industry (CII), Gadkari had marked that the central government is working on a policy for establishing ethanol pumps across the country to speed up the adoption of clean energy and dump the polluting fossil fuels. He added that there is a requirement of 1000 crore litres of ethanol if it is used to blend with the petrol by up to 20 percent.
The Union Government has laid a major emphasis on the production of ethanol in the country and also blending it with petrol. The government has taken various steps in providing a boost to the ethanol production and ethanol production capacity in the country. A “Roadmap for Ethanol Blending in India 2020-25” was released by the PM in June 2021 which laid out a detailed pathway for achieving 20 percent ethanol blending. Due to the coordinated efforts of the Public Sector Oil Marketing Companies (OMCs) and the increase in diversion of sugar for ethanol production, the target of 10 percent blending under the programme had been achieved much ahead (August 2022) of the targeted deadline of November 2022 wherein the Public Sector OMCs have attained an average 10 percent ethanol blending in petrol across the country.
Also, recently in the month of February, 20 percent ethanol-blended petrol was made available at a few select petrol pumps in 11 states and the union territories as part of a campaign to increase the use of biofuels to reduce emissions and reliance on foreign exchange depleting imports. The 20 percent ethanol-blended petrol was launched by PM Narendra Modi two months ahead of the planned rollout in April at the India Energy Week in Bengaluru, Karnataka. The chart below shows the ethanol production capacity in the country.
The ethanol production capacity in India has increased from 423 crore litres in 2019-20 to 947 crore litres in 2022-23. This means that the ethanol production capacity has doubled in just three years. The Central Government has taken various steps to increase production and utilization of ethanol. The Government has amended the Industries (Development & Regulation) Act to ensure free movement of ethanol in the country. The Government has also reduced Goods & Service Tax (GST) on ethanol meant for Ethanol Blended with Petrol (EBP) Programme from 18 percent to 5 percent since 2018.
Under the ethanol blending programme, an indicative target of 20 percent blending of ethanol in petrol by 2030 was laid out. Subsequently, the target year for achieving 20 percent ethanol blending in petrol was also advanced to 2025. By blending 20 percent ethanol, the nation could experience significant benefits, including energy security, reduced carbon emissions, improved air quality, self-reliance, the use of damaged food grains, an increase in farmer incomes, the creation of jobs, and more investment opportunities. Also, the central government is urging sugar mills to divert extra sugarcane to ethanol in order to find a long-term solution to the issue of excess sugar. About 45–50 LMT of extra sugar in the current sugar season (2022–2023) is intended to be converted to ethanol. According to Sudhanshu Pandey, secretary, department of food and public distribution, these activities are leading to transforming the Indian farming community from ‘Anna Daata’ to ‘Urja Daata.’
The chart shows that there is a rise in payment to farmers enabled by the EBP Programme. From Rs. 1119 crore in 2013-14, the payment to the farmers has increased to Rs.16,793 crore in 2021-22. In addition to this, in the past six years, ethanol supplies and blending percentages have surged by more than five times. In past three Ethanol Supply Years (December- November), revenue of about Rs. 48,573 crore has been realized by sugar mills from the sale of ethanol to Oil Marketing Companies (OMCs), which has helped sugar mills/molasses based distilleries to make timely payment of cane dues of farmers. Therefore, with a view to support sugar sector and in the interest of sugarcane farmers, the central government is encouraging sugar mills to divert excess sugarcane & sugar to ethanol. This shows that apart from saving foreign exchange reserves, ethanol blending has been beneficial for farmers, OMCs and the environment too.
Oil Marketing Companies (OMCs) have paid sugar mills Rs 81,796 crore under the EBP in the last seven years for ethanol supplies, which helped mills in paying farmers' bills. In order to reach the EBP target, it has also been decided to purchase damaged and excess food grains for ethanol production, guaranteeing a fair market price for the excess grain stock. Ethanol is environment friendly as one crore litre of ethanol blended petrol can save around 20,000 tons of carbon dioxide emission. Greenhouse gas emissions due to the EBP Programme were reduced by 318.2 lac tons during 2014 to November 2022.
The government is also looking forward to set up maximum 2G ethanol plants. Rice straw, wheat straw, and other agricultural leftovers can be converted to ethanol in a second generation or 2G ethanol plant. With India producing about 160MMT of surplus agricultural residues each year, 2G ethanol facilities present a huge business opportunity. A 100 kl per day facility can use 2 lakh tonnes of agricultural waste annually to produce about 3 crore litres of ethanol.
The Government of India in order to ensure efficient ethanol production had banned the export of broken rice in September 2022. The government had amended the broken rice export policy in order to ensure adequate availability of broken rice for consumption by domestic poultry industry and other animal feedstock; and to produce ethanol for successful implementation of EBP (Ethanol Blending Programme) programme. According to experts, the primary reason behind the prohibition on the export of broken rice is to meet the targets of ethanol blending program. Sugar-based feed stocks alone cannot meet the 1100 crore litres of ethanol required for 20 percent ethanol blending by 2025. The chart below shows the export of broken rice from India during the last five years.
Source: Ministry of Commerce and Industry
The export of broken rice has been rising continuously over the years. In the FY 2017-18, 1200.355 tons of broken rice was exported from India. The FY 2019-20 witnessed a massive decline in the exports of broken rice due to the outbreak of the covid-19 pandemic which forced the government to impose nationwide lockdowns and which ultimately disrupted the global supply chains. Only 270.338 tons of broken rice was exported in the FY 2019-20. The exports in the FY 2020-21 registered a growth of 663.7 percent as 2064.562 tons of the essential commodity was exported to different countries. The FY 2021-22 witnessed the highest exports of broken rice till date as 3890.866 tons of broken rice was exported. But the export of broken rice fell drastically in 2022-23 as much of the broken rice was diverted to poultry industry and ethanol blending programme.
The chart shows that the diversion of sugar for the ethanol production has increased from 0.33 MT in 2018-19 to 3.6 LMT in 2021-22 and it is estimated that about 4.5 million tons of sugar would be diverted for the production of ethanol. The ethanol supply year is calculated from November 1 to October 31st. The government has taken a number of steps for increasing the ethanol production in the country as it is beneficial for the OMCs, farmers, economy and the environment too.
India is trying to reduce its dependence on fossil fuels and move towards a future powered by ethanol but the journey is not easy as it seems as it involves a number of difficulties. But the Government of India along with all the stakeholders is actively working towards maximizing production of ethanol and building a green future for the country.
