Ethanol blending in petrol has saved more than ₹20,000 crore in foreign exchange during the ethanol supply year (ESY) 2021-22 (December 2021 to November 2022).

Public sector oil marketing companies have saved 433.6 crore litres of petrol due to ethanol blending during ESY 2021-22, according to data provided by the Union Minister of State for Petroleum & Natural Gas in the Rajya Sabha.

To address environmental concerns arising from the transportation sector, reduce dependence on crude oil imports, and boost the agriculture sector, the Indian government had launched the ethanol-blended petrol (EBP) programme in 2003, targeting to supply petrol blended with 5 per cent ethanol. It reset the target to blend petrol with 20 per cent ethanol by 2025 through the National Biofuels Policy.

The country achieved the target of supplying 10 per cent EBP in June 2022, five months ahead of schedule, up from 0.67 per cent blending in 2012. To achieve 20 per cent blending by 2025-26, it may require about 10.15 billion litres of ethanol.

Flex-fuel vehicles

E20 fuel, the 20 per cent ethanol blend with petrol, was launched in February this year at 84 outlets of oil marketing companies across the country. Further, the sale of E100 on a pilot basis has commenced at three outlets in Pune.

Flex fuel engines can run on ethanol blend ranging from 20 per cent to 85 per cent. Indian automotive manufacturers are gearing up to adapt their products for flex fuel. Several manufacturers showcased their flex-fuel vehicles and engines at the recent Auto Expo 2023.

The market for ethanol in India is currently driven primarily by demand for disinfectants, beverages and other industrial applications; the Indian ethanol market is estimated to reach $5.64 billion (about ₹40,593 crore) by 2027, according to estimates.