The ethanol supply in the country to enable blending with petrol is likely to reach 302 crore litres, according to the Economic Survey 2021-2022.
The government has set a target of 20% ethanol blending with petrol to be achieved by 2025 to reduce the country’s crude oil import bill, give a boost to the agriculture sector and reduce environmental pollution.
The ethanol supply under the Ethanol Blended Petrol (EBP) Programme is expected to be more than 302 crore litres by the end of Ethanol Supply Year (ESY) 2020-2021 (December 1, 2020 -November 30, 2021) to achieve approximately 8.1% blending, the Economic Survey noted. This is an increase of 74.5% compared with the previous year when 173.3 crore litres were produced.
The ethanol blending target for ESY 2021-22 is 10%.
The government last year notified mass emission standards for E12 (12% ethanol blended with petrol) and E15 (15% ethanol blended with petrol) to enable the automobile industry to manufacture E12- and E15-compliant motor vehicles.
Under the EBP programme, the government aims to ramp up the production of ethanol, including through opening of ‘alternate’ route for ethanol production, reduction in GST on ethanol from 18% to 5% and via the interest subvention scheme.
The government is also encouraging distilleries to produce ethanol from rice available with FCI and maize and has set a target of ethanol production of 1,500 crore litres by 2025, out of which almost half, or 740 crore litres, would be from grain-based distilleries, with the remainder coming from sugar-based distilleries.