Numerous countries including India have adopted the practice of blending ethanol with petrol so as to reduce exhaust emissions from vehicles. This practice also helps to reduce the import burden on account of crude petroleum from which petrol is obtained.
By conservative estimate it is said that even five percent blending can help replace around 1.8 million barrels of crude oil.
Benefits of ethanol blending:
Ethanol content is a by product in the conversion of sugar cane juice to sugar. It is mainly derived by sugarcane molasses. It results in a net reduction in the emission of carbon dioxide, carbon monoxide (CO) and hydrocarbons (HC).
Ethanol burns cleaner and burns more completely than petrol.
History of ethanol blending in India:
- Ethanol blending started in India in 2001.
- In 9 States and 4 Union Territories, government made it mandatory to blend five percent ethanol with petrol in the year 2003.
- In November 2006 it was made compulsory to blend five percent ethanol with petrol in 20 states and 8 union territories.
- In 2006 it was seen as an attempt to reduce the under-recovery of public sector oil marketing companies.
The Minister of State for Petroleum & Natural Gas Mr. Dharmendra Pradhan recently said that the Government has permitted Oil Marketing Companies (OMCs) to sell Ethanol blended petrol with percentage of ethanol up to 10 percent as per BIS Specification to achieve five percent ethanol blending across the country as a whole. During the sugar year 2014-15, OMCs have achieved a blending percentage of 2.3 per cent.
The Government has fixed the price of ethanol. As petrol has been decontrolled with effect from June, 2010 OMCs take appropriate decision on pricing of petrol as per international prices and market conditions.
Ethanol blending in Petrol results in saving of Petrol to the extent of its blending and consequent foreign exchange. The potential foreign exchange earnings for the Sugar Year 2014-15 amounts to around USD 285 Million.
In order to improve the availability of ethanol and encourage ethanol blending, the Government has taken following steps :
- The Government has fixed the delivered price of ethanol in the range of Rs.48.50 per litre to 49.50 per litre.
- Ethanol produced from other non-food feedstocks besides molasses, like cellulosic and ligno cellulosic materials including petrochemical route, have been allowed to be procured.
- Ministry of Petroleum and Natural Gas, on 1st September, 2015, inter-alia has asked OMCs to target ten percent blending of ethanol in Petrol in as many States as possible.
- The procedure of procurement of ethanol under the EBP has been simplified to streamline the entire ethanol supply chain.
- Excise duty has been waived on ethanol supplies to OMCs for EBP by sugar mills during 2015-16.
Above initiatives to incentivise Ethanol Blended Petrol (EBP) Programme are expected to increase blending of ethanol in the near future.