NEW DELHI: Road Transport and Highways Minister Nitin Gadkari on Tuesday stressed on the need to divert excess sugar stock for ethanol manufacturing as provision of subsidies on exports of sweetener will not be permissable after December 2023 under the WTO regime.
Addressing a webinar on alternative fuels organised by industry body ISMA, the minister said the government is promoting ethanol manufacturing in a big way and assured that it will procure all ethanol produced in the country.
With increased supply of ethanol, Gadkari said the government plans to introduce flex fuel engine vehicles in the country.
With the rollout of flex-fuel vehicles on 100 per cent bio-ethanol, the demand for ethanol will immediately jump by 4 to 5 times, he added.
The minister also asked sugar mills to set up their own ethanol pumps, which are being permitted by the government.
“It is under our purview that we can take the decision for making mandatory flex engine for the petrol vehicles. So, that can increase the demand of ethanol in Indian market,” Gadkari said.
Stating that the government is giving permission for the ethanol pump, the minister told sugar mills that they can establish their own pumps.
“Now there is a policy and my own sugar factory, also my son has taken the permission,” he added.
Gadkari said the government is providing export subisdy to the tune of Rs 3,000 to Rs 6,000 crore to sugar mills for liquidating surplus sugar stocks.
“Due to our commitments to international organisations such as WTO, these subsidies will not be permissable after December 2023,” he pointed out.
As a solution to this problem, Gadkari suggested that the excess sugar stocks can be diverted towards producing ethanol by adding 15-20 per cent sugar into B-Heavy Molasses.
“This will have multiple benefits – firstly, it will utilise an excess stock of around 45 to 60 lakh metric tonnes of sugar and will improve the ethanol recovery by 30 per cent due to better quality of raw material,” he said.
Stressing on the need to discourage the use of petrol or diesel as a fuel, he said the focus should be on the adoption of alternative fuels which will be import substitute, cost-effective, pollution-free and indigenous.
“To make this possible, I am giving a special push for ethanol as fuel. The biggest benefit is that it is a clean fuel with very low greenhouse gas emissions,” the minister said.
The additional income that is generated is directly diverted to the farmers, which empowers the rural and backward economy.
“Ethanol can be the tool to empower our rural and backward areas where we can increase employment and bring prosperity into the lives of our farmers,” he observed.
Gadkari highlighted that India started its programme for ethanol blending with petrol in 2003 but made it mandatory at 5 per cent in 2007.
The government brought the fixed ethanol procurement pricing policy from December 2014.
From around 1 per cent blending in 2014, the country has achieved 5 per cent ethanol blending with petrol in the next 5 years.
From 2018 onwards, Gadkari said the government has been fixing multiple prices for ethanol, based on the feedstock used to produce ethanol.
This encouraged diversion of B-heavy molasses and sugarcane juice into the production of ethanol, he added.
“Now, we have allowed the use of grains like corn, surplus rice, damaged food grains, sweet sorghum, bajra, jawar for the production of ethanol,” he said.
Looking at the ethanol production capacity and its adoptability as a fuel, Gadkari said the government has redesigned and launched the E-20 fuel programme which will ensure the use of bio-ethanol in 20 per cent blend with petrol by 2025 in India.
To achieve 20 per cent ethanol blending, the country will require around 10 billion litres of ethanol by 2025. At present, the sugar industry contributes to 90 per cent of ethanol demand as a blended fuel in the country.
To increase ethanol production with available resources, Gadkari suggested to add 15-20 per cent sugar into B-Heavy Molasses.
“For the pricing, the production of ethanol from sugarcane juice or syrup has been facing some problems. The same pricing of approx. Rs 62/litre can be considered as an incentive for sugar millers to divert their excess sugar stocks into B-Heavy Molasses,” he said.
Gadkari also spoke about the need to discouraging production of C-Heavy Molasses from sugar.
“This will standardise the production of B-Heavy Molasses and will permanently lead to lesser production of sugar by 1.5 per cent per metric tonne of sugarcane,” he said, adding that these steps could boost ethanol output.
The minister pointed out that the country’s import dependence on petroleum is expected to go up to the tune of Rs 15 lakh crore in the next 5 years.
“Increased availability of ethanol will directly help in introduction of flex engines, which we will soon introduced in India,” he said.
Gadkari said the incentives provided to sugar mills have been extended to the grain-based ethanol distilleries since January 2021.
“The target is to get around 4 billion litres of ethanol production from grain-based distilleries,” he said.
Gadkari said that with 100 per cent use of a 20 per cent blend of bio-ethanol, the country will be able to save Rs 30,000 crore on import of fossil fuels.
“We are planning to introduce flex-fuel vehicles soon which allow the operation of the vehicles on 100 per cent bio-ethanol or 100 per cent petrol,” he added.
Gadkari said the government of India is seriously working on how to increase the use of ethanol in transport sector.
The Prime Minister has recently launched three 100 per cent ethanol pumps and the petroleum ministry is now promoting the setting up of dispensing units by private entities.
“Currently, the ethanol economy is Rs 20,000 crore which I am targeting to raise to Rs 2 lakh crore,” he said.
Gadkari emphasised on conducting research on how to successfully blend ethanol with diesel.
The minister said that bio-ethanol can also be a sustainable fuel for aviation purpose.
Besides ethanol, he said the government is promoting the use of clean and green alternative fuels such as Methanol, Bio-diesel, Bio-CNG, LNG, H-CNG, Electricity, and Hydrogen fuel cell in addition to ethanol.