Government measures to increase Ethanol Blending beyond 20%

The National Policy on Biofuels – 2018, amended in 2022, advanced the 20% ethanol blending target in petrol from 2030 to the Ethanol Supply Year (ESY) FY26. Public Sector Oil Marketing Companies (OMCs) achieved 10% ethanol blending in June 2022, five months ahead of schedule for ESY FY22. Ethanol blending further increased to 12.06% in ESY FY23, 14.60% in ESY FY24, and 17.98% in ESY FY25 (as of February 28, 2025). However, no decision has been made to increase blending beyond 20%. An inter-ministerial committee's Roadmap for Ethanol Blending in India 2020-25 found that 20% ethanol-blended petrol (E20) leads to a marginal reduction in fuel efficiency for E10-calibrated four-wheelers. However, modifications in engine hardware can reduce this efficiency loss. 

The National Biofuel Coordination Committee allows food grains for ethanol production during surplus phases, promoting feedstocks such as maize, sugarcane juice, molasses, broken rice, and agricultural residues. The Ethanol Blended Petrol (EBP) Programme, launched in 2014, supports ethanol producers through subsidised pricing, a 5% Goods and Services Tax (GST) rate, and regulatory amendments for easier inter-state ethanol movement. The government has also introduced Ethanol Interest Subvention Schemes (EISS) and Long-Term Offtake Agreements (LTOAs) to encourage ethanol production from molasses and grains. This information was provided by the Minister of State for Petroleum & Natural Gas, Mr. Suresh Gopi, in a written reply in the Lok Sabha. 

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.