Methanol and its gaseous form — dymethylether (DME) — are likely to be notified as transport fuel soon, which will help lower fuel costs in India.

“The Highways and Shipping Ministry Ministry has already prepared the draft notification of M15, M100 & DME as transport fuel and is expecting a clearance from the Law Ministry to be notified officially. India has had extensive discussions with Israel, which has successfully implemented Methanol 15 (M15) blending program for Technology transfer,” stated a release, quoting Nitin Gadkari, Union Minister of Road Transport and Highways, Shipping, Water Resources, River Development & Ganga Rejuvenation, who made a statement in the Lok Sabha on Thursday. Global engine manufactures such as Volvo, Caterpillar and Mercedes, in collaboration with Indian players, can manufacture these engines under Make in India and this will result in big foreign investments. Development of this sector will create jobs in the engineering sector, the release added.

India needs around 2,900 crore litres of petrol and 9,000 crore litres of diesel per year currently, making it the sixth highest consumer in the world. By 2030, consumption will double, making India the third largest consumer.

“Our import bill on account of crude stands at almost ₹6 lakh crore,” said the Minister.

Methanol is a clean burning drop-in fuel that can replace petrol and diesel in transportation and LPG, wood, kerosene in cooking fuel. It can also replace diesel in Railways, marine sector, gensets, and power generation. Methanol-based reformers could be the ideal complement to hybrid and electric mobility, the release said.

A methanol locomotive prototype is being implemented by the Railways under a grant by the Department of Science and Technology and once all the 6,000 diesel engines are converted to methanol (at very minimal cost of less than ₹1 crore a engine), the annual diesel bill can be reduced by half.

India has an installed methanol production capacity of 2 million tonnes per annum.

As per the plan prepared by NITI Aayog, using Indian high ash coal, stranded gas, and biomass can produce 20 mt of methanol annually by 2025.

India, with 125 billion tonnes of proven coal reserves and 500 million tonnes of biomass generated every year and the huge quantities of stranded and flared gases, has a huge potential for ensuring energy security based on alternate feedstock and fuels, it added.