Understanding India’s Ethanol Blending Policy

Why does the government want to increase the percentage of ethyl alcohol in petrol? From where does India source its ethanol?

Why does the government want to increase the percentage of ethyl alcohol in petrol? From where does India source its ethanol?

the story So Far: The Union Cabinet on Wednesday approved amendments to the National Policy on Biofuels, 2018 to allow fuel companies to increase the percentage of ethanol in petrol to 20% from 2030 to 2025. The policy to introduce 20% ethanol is expected to be effective from April 1, 2023.

What is the history of ethanol-blending in India?

For over two decades, India has been moving towards establishing an ecosystem for blending more ethanol in petrol for use vehicles, especially two and four wheelers. Government records show that about 75% of India’s 220 million vehicles are two-wheelers and 12% are four-wheelers. Ethanol, or ethyl alcohol, is a hydrocarbon that when burned can generate heat and electric engines.

However, it takes more ethanol to run a vehicle engine than petrol. It also leaves residual by-products that can corrode and damage the vehicle, which is why, while vehicles can be run on ethanol, they need to be tuned accordingly to ensure efficiency and Don’t compromise on usability. On the other hand, the benefits are potentially significant as ethanol can be derived from sugarcane, molasses, maize, which could substantially reduce India’s dependence on petroleum, given India’s agricultural base.

Since 2001, India has tested the feasibility of ethanol-blended petrol, supplying 5% ethanol blended petrol (95% petrol-5% ethanol) to retail outlets. In 2002, India launched the Ethanol Blended Petrol (EBP) program and began selling 5% ethanol blended petrol in nine states and four union territories, which was expanded to twenty states and four union territories in 2006. As of 2013–14, however, the percentage blending never exceeded 1.5%.

In 2015, the Ministry of Road Transport and Highways notified that the E5 [blending 5% ethanol with 95% gasoline] The petrol and rubber and plastic components used in gasoline vehicles produced since 2008 are E10 fuel compatible. In 2019, the ministry notified E10 fuel [blending 10% ethanol with 90% gasoline], The rubber and plastic components used in petrol vehicles are currently compatible with E10 fuel. Financial incentives as well as policy support for distilleries have seen an average blending touch of 5%. Standards have already been set for E20, E85 and even E100 fuels. This includes standards for ethanol blended diesel. From 2020, India is declaring its intention to achieve 10% blending by the end of 2022 and 20% blending by 2030. The center has also set a target of 5% blending of biodiesel with diesel by 2030.

Summary

The Union Cabinet on Wednesday approved amendments to the National Policy on Biofuels, 2018 to extend the date by which fuel companies will have to increase the percentage of ethanol in petrol to 20% from 2030 to 2025.

The NITI Aayog Committee report for June 2021 presents a comprehensive picture of ethanol blending, challenges and roadmap.

Car manufacturers have stated that with modifications to the engine (hardware and tuning), the efficiency loss due to mixed fuel can be reduced. To compensate consumers for the drop in efficiency from ethanol blended fuels, tax incentives on E20 fuels may be considered.

What does it mean to switch to E20?

The NITI Aayog Committee report for June 2021 presents a comprehensive picture of ethanol blending, challenges and roadmap. India’s net imports of petroleum stood at 185 million tonnes in 2020-21 at a cost of $55 billion. Most of the petroleum is used by vehicles and hence a successful 20% ethanol blending program could save the country $4 billion per year or about Rs 30,000 crore. To achieve such savings, the committee estimates that there will be a demand of 1,016 crore liters of ethanol based on the expected increase in the vehicular population. As electric vehicles are also expected to grow, this should partially meet the demand for ethanol, which will require 722-921 million liters in 2025.

However, this is an “optimistic” projection as noted in the policy report itself. India’s current ethanol production capacity includes 426 million liters from molasses-based distilleries and 258 million liters from grain-based distilleries. This is expected to increase to 760 crore liters and 740 crore liters respectively and will be sufficient to produce 1016 crore liters of ethanol required for EBP and 334 crore liters for other uses. This would require six million tonnes of sugar and 16.5 million tonnes of food grains per year in ESY 2025.

How does this affect the engines?

When using E20, there is an estimated loss of 6-7% fuel efficiency for four wheelers originally designed for E0 and calibrated for E10, two wheelers designed for E0 For vehicles 3-4% and calibrated to E10 and 1-2% for four wheelers designed for E10 and calibrated for E20. Car manufacturers have stated that with modifications to the engine (hardware and tuning), the efficiency loss due to mixed fuel can be reduced. To compensate consumers for the drop in efficiency from ethanol blended fuels, tax incentives may be considered on E10 and E20 fuels. The report said the test vehicles performed well in several test conditions.

What is international experience?

Flex fuel engine technology (FFE), or vehicles that run entirely on ethanol, are popular in Brazil and comprise about 80% of the total number of new vehicles sold in 2019. Flex fuel vehicles (four wheelers) can cost about ₹17,000 to ₹25,000 more than the current generation vehicles.

Two wheeler flex fueled vehicles will be costlier by ₹5,000 to ₹12,000 as compared to regular petrol vehicles. Global production of the fuel ethanol reached 110 billion liters in 2019, or an average increase of 4% per year over the past decade. The US and Brazil make up 92 billion liters or 84% of the global share, followed by the European Union (EU), China, India, Canada and Thailand.

Due to the MSP provided by the government, the prices of ethanol produced in India are higher as compared to the US and Brazil.

What are the environmental costs of ethanol blending?

Since ethanol burns more completely than petrol, it avoids emissions such as carbon monoxide. However, tests conducted in India showed no reduction in nitrous oxide, one of the major environmental pollutants. A report by the Institute for Energy Economics and Financial Analysis (IEEFA) states that India needs to bring 30,000 additional sq km of land to come under maize, to meet its target of 20% ethanol blended in petrol by the year 2025. would be required. Farming. He says half of that land could be used more efficiently to generate clean electricity from solar power.

Sugarcane is the cheapest source of ethanol for India. On average, one ton of sugarcane can produce 100 kg of sugar and 70 liters of ethanol, but it would take 1,600 to 2,000 liters of water to produce 1 kg of sugar, which means about 2,860 liters for one liter of ethanol from sugar. Water is required.