- E20 = petrol blended with 20% ethanol + 80% petrol by volume; minimum octane rating 95 RON.
- Ethanol: organic alcohol (C₂H₅OH) produced from sugarcane, maize, barley, wheat, damaged grains, agricultural residues.
- Octane value: Ethanol has ~108 RON vs petrol's ~91 RON → better combustion.
- Nodal Ministry: Ministry of Petroleum and Natural Gas; OMCs (IOC, BPCL, HPCL) procure ethanol.
- From 1 April 2026: All ~90,000 petrol pumps in India mandated to supply E20; E5/E10 withdrawn.
Next target
- E30 blending by 2030; exploring E100 (pure ethanol) for energy self-reliance
- Policy Framework.
Key policies & institutions
- National Policy on Biofuels (NPB) 2018: Foundation framework; amended 2022 to advance targets and expand feedstocks.
- NPB 2022 Amendments: Advanced E20 to ESY 2025-26; allowed FCI surplus grains; permitted biofuel exports in specific cases; new members to NBCC; SEZ/EOU units allowed to produce biofuels under Make in India.
- National Biofuel Coordination Committee (NBCC): Apex body; oversees feedstock use based on surplus declarations.
- Pradhan Mantri JI-VAN Yojana: Viability gap funding for 2G/advanced biofuels from agricultural/forestry residues, industrial waste, algae.
- Global Biofuel Alliance (GBA): India-led international initiative (G20, 2023) for biofuel tech transfer and standards.
- Long-Term Offtake Agreements (LTOAs): OMCs sign with distilleries → assured demand → investment confidence.
- Ethanol Interest Subvention Scheme: Capital aid for setting up molasses- and grain-based distilleries.
Sources of ethanol (1G / 2G / 3G)
- 1G (First Generation): Sugarcane juice, molasses, maize, barley, wheat, damaged grains, surplus FCI grains, rotten potatoes — currently dominant.
- 2G (Second Generation): Cellulosic biomass, paddy/wheat straw, corn cobs, bagasse, bamboo, municipal solid waste — non-food feedstock; Panipat refinery (IOC, 2022) is a pioneer plant using paddy straw (addresses stubble burning too).
- 3G (Third Generation): Algae, microbes, novel biochemical routes — R&D stage globally; supported via GBA.
- India became a net maize importer in 2024-25 partly due to ethanol demand — highlights food-fuel tension.
Benefits
♦ Energy security: Reduces crude oil import dependence; hedge against West Asia geopolitics.
♦ Forex savings: ₹30,000 cr/year estimated at E20; ₹41,500 cr saved till 2022.
♦ Environment: ~700 lakh tonnes CO₂ avoided till 2025; lower CO, hydrocarbons, particulate matter; aids Paris Agreement NDCs.
♦ Farmer income: ₹40,600 cr paid to farmers by 2022; supports sugarcane & maize growers.
♦ Waste-to-wealth: Damaged grains, paddy straw, molasses → ethanol; aligns with circular economy.
♦ Rural employment: Distillery expansion creates jobs in rural areas.
♦ Better octane: Ethanol (108 RON) improves combustion quality vs plain petrol.
Challenges
♦ Food vs fuel: Sugarcane & maize diversion risks food supply; India became net maize importer 2024-25.
♦ Water stress: Sugarcane is highly water-intensive; conflicts with water-scarce regions.
♦ Vehicle compatibility: Most older vehicles designed for E10; mileage loss of 2–4% with E20 (govt. claim); older vehicles may suffer more.
♦ Flex-fuel gap: Absence of Flex-Fuel Vehicles (FFVs) or retrofit regulations for E20+ in mass market.
♦ Infrastructure: Ethanol-compatible storage, pipelines, and pumps needed at scale.
♦ 2G technology lag: Cellulosic ethanol nascent; high cost and technical barriers.
♦ Seasonal supply: Distilleries pause June–Sept; supply gaps possible.