The government is planning to create a carryover stock of ethanol for the next year anticipating a rise in demand for E20 fuel in the country, according to a senior food ministry official. E20 fuel is a blend of 20 percent ethanol with petrol. The government aims to achieve the 20 percent ethanol blending target by 2025.
"Ethanol blending is going well. Oil Marketing Companies (OMCs) have started dispensing E20 fuel in about 100 outlets in 31 cities in the country. We have started E20 fuel, if it goes well then, the requirement will be more," said Subodh Kumar, Additional Secretary in the food ministry.
Like sugar, the government plans to create a carryover stock of ethanol with OMCs and distilleries for 2023-24 ethanol year (December-November) and more sugar would be diverted for the same, he said. The government has kept the 12 percent ethanol blending target in the ongoing 2022-23 ethanol year while 15 percent for the next year.
"About 1.20 billion litres has been blended with petrol till February-end. We are continuously blending 12 percent. The ethanol availability and production capacity are sufficient to meet this year's target," the official said.
To meet 15 percent blending target next year, the official said that additional 1.50 billion litres of ethanol would be required, and the government is encouraging sugar mills and distilleries to enhance production capacity.
The ethanol production capacity has gone up to 10.40 billion litres till February this year. The government is encouraging ethanol capacity creation under an interest subvention scheme. The official said that the government has approved 243 projects and banks have already sanctioned Rs 203.34 billion loans and out of which Rs 110.93 billion has been disbursed.
Last week, the government reviewed the upcoming projects and about 2.50-3.00 billion litres of ethanol capacity will come in the next 9-10 months, he added.
