Introduction
India, the world’s third-largest energy consumer, is making strides toward sustainable energy independence by embracing ethanol blending. India’s ethanol push targets 20% blending by 2025, strengthening energy security, supporting rural growth, and lowering carbon emissions.
Historically reliant on oil imports, the country faces challenges around energy security and foreign currency outflows. Ethanol, a sugarcane byproduct, reduces fossil fuel use, cuts carbon emissions, and promotes a cleaner environment.
Early Efforts and Renewed Progress
India initiated ethanol blending as a pilot in 2001. However, limited progress and stagnant production hindered its growth for years. Recently, reforms have revitalized this program, increasing energy security and boosting rural economies. By advancing the 20% blending goal from 2030 to 2025, the government has shown its commitment to sustainable energy. At the 7th G-STIC Conference, Minister Hardeep Singh Puri praised India’s ethanol progress and outlined goals beyond 20% blending. In Ethanol Supply Year (ESY) 2022-23, India achieved 12.06% blending, reaching over 13% by August 2024, up from 1.53% in 2014.
Economic and Environmental Impact
Reaching 20% blending by 2025 needs 1,016 crore liters of ethanol, with demand projected at 1,350 crore liters. This initiative saved ₹1,06,072 crore, cut CO₂ emissions by 544 lakh tons, and reduced oil dependence by 181 lakh tons. Public sector Oil Marketing Companies (OMCs) have also disbursed ₹1,45,930 crore to distillers and ₹87,558 crore to farmers, boosting the agricultural sector.
Key Strategies
- Policy Support: The government extended the Pradhan Mantri JI-VAN Yojana to 2028-29, adding advanced biofuels from agricultural waste and algae.
- Expanded Feedstocks: Increasing ethanol production from varied feedstocks enhances resource use and sustainability.
- Favorable Pricing: A procurement price ensures fair compensation under the Ethanol Blended Petrol (EBP) Programme.
- Reduced Tax Burden: GST on ethanol for the EBP Program was lowered to 5%, making ethanol financially attractive.
- Interest Subsidies: Subsidies support capacity expansion to meet future blending requirements.
Versatility of Ethanol
Ethanol, a biofuel produced by sugar fermentation or ethylene hydration, serves various roles beyond fuel, including as a solvent, in chemical synthesis, and in medical uses as an antiseptic. With 98% of India’s transport fuel coming from fossil fuels, ethanol offers a domestic alternative that can reduce dependence on imports and support initiatives like “Make in India,” Swachh Bharat, and increased farmer income.
Milestones in Ethanol Blending
Under Prime Minister Narendra Modi’s leadership, India advanced the ethanol blending target from 2030 to 2025. By ESY 2023-24, blending volumes exceeded 545.05 crore liters, with significant growth from 1.53% in 2014 to 15% in 2024, reflecting the government’s commitment to sustainability and energy security.
India’s ethanol journey exemplifies its dedication to achieving long-term energy security and cleaner energy solutions, positioning ethanol as a key player in its sustainable energy landscape.
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