INDIA'S ETHANOL DILEMMA

INDIA ACHIEVED A 20% ETHANOL BLENDING IN PETROL THIS YEAR, FIVE YEARS AHEAD OF SCHEDULE. WHILE IT IS AN IMPORTANT STEP TOWARDS REDUCING CRUDE OIL IMPORTS, AUTO OWNERS ARE COMPLAINING ABOUT REDUCED MILEAGE AND DAMAGED ENGINES. DOES INDIA'S ETHANOL POLICY NEED A TWEAK?

- BY RICHA SHARMA

THE GOVERNMENT SAVED over ₹1.4 lakh crore in foreign exchange on account of the Ethanol Blended Petrol (EBP) Programme, Union Petroleum and Natural Gas Minister Hardeep Singh Puri said in the Lok Sabha recently. However, behind the national success story lies a more complicated reality for consumers as they complain about reduced mileage and claim rejection by insurance companies.

According to the government, the EBP Programme has also played a key role in improving farmer incomes by enabling better crop prices and more timely payments, particularly in sugarcane, where payment delays by mills have been endemic. Puri said that from ethanol supply year (ESY) 2014-15 up to June 2025, the programme has facilitated payment of over ₹1.21 lakh crore to farmers and replaced more than 238 lakh metric tonnes of crude oil.

As the government races ahead with its ethanol blending roadmap—reaching the E20 milestone in 2025, five years ahead of schedule—the ripple effects are being felt in every corner of the country. Social media is flooded with complaints of 10-15% fuel efficiency loss, far beyond the government's estimate of 2-4%. Meanwhile, oil marketing companies (OMCs) are absorbing a ₹1.7 per litre loss on E20, citing high feedstock costs. While automakers insist that no engine damage has been reported, some insurers have warned that using ethanol-blended fuel in non-compatible vehicles may void engine-related claims.

This brings us to the larger question of whether India's ethanol policy, as it stands now, requires a re-examination.

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