India’s Ethanol Blending Programme Sees Significant Progress, Expands Nationwide Reach
In the past few years, India’s Ethanol Blended Petrol (EBP) scheme has done incredibly well. EBP’s ethanol blending with petrol has increased to as high as 14.6% in ESY 2023–24 against 5% in the previous period of 2018–19. Enhanced blending has also had an increase in sizeable supply, which is above 700 crore litres against an earlier figure of 188.6 crore litres.
He made the disclosure in his written reply to the Rajya Sabha on Monday. This growth is part of India’s efforts toward greener fuel alternatives. This falls under a more comprehensive energy policy to progressively reduce dependence on imported crude oil, promote sustainable farming, and cut carbon emissions.
Ethanol Blending: A National Success Story The EBP scheme, introduced in 2003, was operationalised in 2006 under a directive to public sector OMCs to provide 5% ethanol-blended petrol in 20 states and four Union Territories. Since then, the programme has scaled up exponentially. In 2019, ethanol-blended petrol was available at 43,168 retail outlets across the country.
This will reach all retail outlets by 2024 and therefore constitutes a considerable achievement in national energy transition.
However, along with a series of other added merits that come from increased ethanol blending in petrol, country’s reliance on imports has come down, additional farmer-friendly revenues, and environmental-friendly practice, the program helps control the expenses on forex expenditure. Estimated savings were nearly over Rs 75,000 cr across three years.
It has also substituted almost 110 lakh metric tonnes of crude oil and simultaneously helped in reducing India’s overall oil import bill. Environmental benefits are also quite substantial through the reduction of about 332 lakh metric tonnes of CO2 emissions through the consumption of ethanol-blended petrol.
Financial benefits to farmers and the economy:
Moreover, the EBP program has benefited Indian farmers. Over the last three years, more than Rs 57,552 crores has been released to farmers under the program so that they receive stable and handsome income for growing sugarcane and other ethanol feedstocks. Talking further, Gopi said that with a target to reach 20% of ethanol blending by 2025–26, the program could give over Rs 35,000 crores for farmers annually.
Actually, the thrust in this policy has helped hasten the increase in blending ethanol. The target for 20% blending by 2030 has been brought forward to 2025-26. The new target for 2025-26 will help strengthen the energy security of India, reduce greenhouse gas emissions, and improve financial prospects for farmers further.
Government Welfare and Incentives
The Indian government has given the EBP program much support through various financial instruments. For instance, there is the Ethanol Interest Subvention Scheme whereby it offers 6% interest subvention per annum or 50% of the rate of interest levied by banks on loans for producing ethanol. It has been relatively easy for distilleries to access funds and expand their capacity to produce ethanol.
The government has also brought an administered price mechanism for cane-based ethanol procurement to ensure fair prices to the farmers and producers. It has been one of the prime reasons that has increased the supply of ethanol for blending in petrol.
Future prospects and policy push
The ethanol blending program is expected to continue on the growth path in the near term so that it achieves 20 percent of blending by 2025–26. This very ambitious target has been advanced in order to accelerate the green energy transition in India as well as give a push to local agriculture. The commitment of the government to this transition can be seen in the continued subsidizing of distilleries as well as incentives for producing ethanol.
It goes very well with large energy goals for India: reducing carbon intensity of the country’s energy sector and meeting climate obligations envisioned in international treaties. Policies-backed, and the public sector OMCs’ continued coordination with distilleries and farmers, India is moving into a future that is at the same time more sustainable and more energy-independent.
The EBP program is an excellent example of how the government is incorporating energy security, environmental sustainability, and economic development in order to meet the rising energy needs of the country as well as the benefits of farmers and the economy at large.
Conclusion:India has indeed done well on the scale of ethanol blending, also in terms of the potential economic, environmental, and agricultural sectoral impacts of this program. The program continues to exist in the form of a strategic and integral part of the energy strategy for the country with ambitious targets such as 20% blending by 2025–26. It has also increased the ethanol blending that not only reduces the dependence of the country on the importation of crude oil but also has economic benefits to farmers, ensures environmental sustainability, and has been able to place India in a prominent position among nations using alternative fuels. Source: Suresh Gopi’s reply in Rajya Sabha, Ministry of Petroleum and Natural Gas.
Source: Suresh Gopi’s reply in Rajya Sabha, Ministry of Petroleum and Natural Gas.