India’s ethanol roadmap: The targets and challenges

Context:

The government of India has advanced the target for 20 per cent ethanol blending in petrol (also called E20) to 2025 from 2030. E20 will be rolled out from April 2023.

Relevance:

GS-III: Environment and Ecology (Conservation of Environment, Environmental Pollution & Degradation)

Dimensions of the Article:

1. What is Ethanol fuel?
2. Ethanol Blended Petrol Programme (EBP)
3. Roadmap for Ethanol Blending in India by 2025
4. Advantages of Ethanol Blending
5. National Policy on Biofuels 2018
6. Way Forward: Recommendations on Ethanol blending

What is Ethanol fuel?

• Ethanol fuel is ethyl alcohol, the same type of alcohol found in alcoholic beverages, used as fuel.
• It is most often used as a motor fuel, mainly as a biofuel additive for gasoline.
• Ethanol is commonly made from biomass such as corn or sugarcane.
• Bioethanol is a form of renewable energy that can be produced from agricultural feedstocks.
• It can be made from very common crops such as hemp, sugarcane, potato, cassava and corn.
• There has been considerable debate about how useful bioethanol is in replacing gasoline.
• Concerns about its production and use relate to increased food prices due to the large amount of arable land required for crops, as well as the energy and pollution balance of the whole cycle of ethanol production, especially from corn.

Ethanol Blended Petrol Programme (EBP)

• Ethanol Blended Petrol (EBP) programme was launched in 2003- and this initiative is pursued aggressively in the last 4 to 5 years to reduce import dependence of crude oil as well as mitigate environmental pollution.
• The Ethanol Blending Programme (EBP) seeks to achieve blending of Ethanol with motor sprit with a view to reducing pollution, conserve foreign exchange and increase value addition in the sugar industry enabling them to clear cane price arrears of farmers.
• Although the Government of India decided to launch EBP programme in 2003 for supply of 5% ethanol blended Petrol, it later scaled up blending targets from 5% to 10% under the Ethanol Blending Programme (EBP).
• The Government of India has also advanced the target for 20% ethanol blending in petrol (also called E20) to 2025 from 2030.
• Currently, 8.5% of ethanol is blended with petrol in India.

Roadmap for Ethanol Blending in India by 2025

• The central government has released an expert committee report on the Roadmap for Ethanol Blending in India by 2025 that proposes a gradual rollout of ethanol-blended fuel to achieve E10 fuel supply by April 2022 and phased rollout of E20 from April 2023 to April 2025.
• The Ministry of Petroleum & Natural Gas (MoP&NG) had instituted an Expert Group to study the issues such as pricing of ethanol, matching pace of the automobile industry to manufacture vehicles with new engines with the supply of ethanol, pricing of such vehicles, fuel efficiency of different engines etc.

Advantages of Ethanol Blending

• Use of ethanol-blended petrol decreases emissions such as carbon monoxide (CO), hydrocarbons (HC) and nitrogen oxides (NOx).
• The unregulated carbonyl emissions, such as acetaldehyde emission were, however, higher with E10 and E20 compared to normal petrol. However, these emissions were relatively lower.
• Increased use of ethanol can help reduce the oil import bill. India’s net import cost stands at USD 551 billion in 2020-21. The E20 program can save the country USD 4 billion (Rs 30,000 crore) per annum.
• The oil companies procure ethanol from farmers that benefits the sugarcane farmers.
• Further, the government plans to encourage use of water-saving crops, such as maize, to produce ethanol, and production of ethanol from non-food feedstock.

National Policy on Biofuels 2018

• The National Policy on Biofuels expands the scope of raw material for ethanol production by allowing use of Sugarcane Juice, Sugar containing materials like Sugar Beet, Sweet Sorghum, Starch containing materials like Corn, Cassava, Damaged food grains like wheat, broken rice, Rotten Potatoes, unfit for human consumption for ethanol production.
• The Policy allows use of surplus food grains for production of ethanol for blending with petrol with the approval of National Biofuel Coordination Committee.
• The Policy encourages setting up of supply chain mechanisms for biodiesel production from non-edible oilseeds, Used Cooking Oil, short gestation crops.
• Among other things, the policy expands the scope of feedstock for ethanol production and has provided for incentives for production of advanced biofuels.
• The policy has the objective of reaching 20% ethanol-blending and 5% biodiesel-blending by the year 2030.

Way Forward: Recommendations on Ethanol blending

1. Notifying Ethanol Blending Roadmap: MoP&NG should immediately notify the plan for pan-India availability of E10 fuel by April, 2022 and its continued availability thereafter until 2025 for older vehicles, and launch of E20 in the country in phases from April, 2023 onwards so as to make E20 available by April, 2025.
2. Augmenting Infrastructure for Oil Marketing Companies: OMCs will need to prepare for the projected requirement of ethanol storage, handling, blending and dispensing infrastructure.
3. Expediting Regulatory Clearances: Currently, ethanol production plants/distilleries fall under the “Red category” and require environmental clearance under the Air and Water Acts for new and expansion projects. This often takes a long time leading to delays. While several steps have been taken to expedite Environment Clearances (EC) under the Environment Protection Act there are few areas of concern which if addressed, will facilitate early setting up of ethanol distillation capacities in the country.
4. Incentivising Ethanol Blended Vehicle: Globally, vehicles compliant with higher ethanol blends are provided with tax benefits. A similar approach may be followed so that the cost increase due to E20 compatible design may be absorbed to a certain extent, as is being done in some states for promoting Electric Vehicles.
5. Pricing of Ethanol Blended Gasoline: For better acceptability of higher ethanol blends in the country, retail price of such fuels should be lower than normal petrol to compensate for the reduction in calorific value and incentivize switching to the blended fuel. Tax breaks on ethanol as a fuel may be considered by the government.

-Source: Down to Earth Magazine