Ethanol Blended Petrol Programme

The Ethanol Blended Petrol Programme mixes domestically produced ethanol with petrol for use as transport fuel. It seeks to replace part of fossil petrol with a renewable biofuel, thereby strengthening energy security while supporting environmental and agricultural objectives.

Role in India's energy strategy

The programme diversifies the transport-fuel mix by substituting domestically produced ethanol for a portion of imported petroleum. Its principal strategic purposes are:

• It reduces petrol consumption and crude-oil import dependence, improving resilience to external supply and price shocks.
• It can save foreign exchange and retain a larger share of transport-fuel expenditure within the domestic economy.
• Ethanol can lower lifecycle greenhouse-gas emissions relative to petrol, although the benefit depends on the feedstock and production process.
• Demand for sugar-based and grain-based ethanol creates an additional market for agricultural produce and supports distilleries, rural employment and value addition.

Policy design and operation

Oil marketing companies procure ethanol and blend it with petrol. The National Policy on Biofuels, 2018, as amended in 2022, advanced the target of 20 per cent ethanol blending to the ethanol supply year 2025-26.

• E10 and E20 denote petrol containing 10 per cent and 20 per cent ethanol by volume, respectively.
• Permitted feedstocks include sugar-industry intermediates and specified grain-based sources, enabling diversification of ethanol supply.
• Differential procurement prices and support for distillery capacity are intended to make production commercially viable and ensure adequate supply.

Limits and safeguards

Ethanol blending is a complement to, not a complete substitute for, wider transport-energy diversification.

• Large-scale production must manage possible food-fuel trade-offs, water use and the environmental effects of feedstock cultivation.
• Storage, transport and blending infrastructure must expand because ethanol is hygroscopic and requires careful handling.
• Higher blends require compatible vehicles and materials; ethanol's lower energy content can also affect fuel economy.