Syllabus
GS Paper 3 – Infrastructure: Energy, Ports, Roads, Airports, Railways etc., Awareness in the fields of IT, Space, Computers, Robotics, Nano-technology, Bio-technology, Conservation, Environmental Pollution and Degradation, Environmental Impact Assessment
Context
India is on its way to achieve its target of blending 20% ethanol with petrol by 2025-26.
Source
The Indian Express | Editorial dated 21st August 2024
On the ethanol blending programme
India’s ambitious goal to achieve a 20% ethanol blend in petrol by 2025-26 is a significant step toward reducing dependence on fossil fuels and promoting renewable energy. The rapid expansion of ethanol production capacity and the ongoing adjustments in government policies reflect the country’s commitment to this target.
Ethanol
Ethanol is a clear, colourless, flammable liquid with a distinct odour, classified as an organic compound.
- Production Methods: Ethanol can be produced through the fermentation of sugars by yeast, a common method in alcoholic beverage production, or synthesized chemically, such as through the hydration of ethylene.
- Primary Uses:
- Beverages: Ethanol is the alcohol present in drinks like beer, wine, and spirits, consumed socially worldwide.
- Fuel: It serves as a biofuel, often mixed with gasoline to create ethanol-blended fuels.
- Industrial Solvent: Ethanol’s solvent properties make it valuable in the production of pharmaceuticals, perfumes, and other products.
- Medical and Laboratory: Ethanol is used as an antiseptic, disinfectant, and preservative in medical and laboratory settings.
- Chemical Feedstock: It is also a precursor in the production of various chemicals.
Ethanol Blending Program (EBP)
- The Ethanol Blending Program (EBP) is a key government initiative to promote the use of ethanol in petrol, enhancing renewable fuel use in India.
- Progress and Targets: Having achieved the 10% ethanol blending target in 2021-22, the government now aims for a 20% blend by 2025-26, as outlined in the National Policy on Biofuels (2018).
- Government Support: The government has simplified procurement processes, fixed remunerative prices, waived excise duty, and provided financial assistance, leading to a 13-fold increase in ethanol supply to Oil Marketing Companies (OMCs) since 2013-14.
Significance of Ethanol Blending in Fuels
- Reducing Fossil Fuel Dependence: By increasing ethanol use, India can cut oil imports, enhancing energy self-reliance and reducing vulnerability to global market fluctuations.
- Environmental Protection: Ethanol burns cleaner than gasoline, reducing harmful emissions. Studies show ethanol blending can lower carbon monoxide emissions by 30-50% and hydrocarbon emissions by 20%.
- Supporting Farmers: Ethanol production creates new demand for crops like sugarcane and corn, boosting farmers’ income and benefiting rural economies.
- Enhancing Energy Security: As a domestic energy source, ethanol reduces dependence on foreign oil, improving national energy security.
- Economic Benefits: The ethanol industry can generate jobs, stimulate investments, and foster innovation, potentially saving India USD 4 billion annually.
- Improved Vehicular Performance: Ethanol’s higher-octane rating enhances engine performance, reducing knocking and improving fuel efficiency.
Steps Taken to Promote Ethanol Blending in India
- Nodal Agency: The Department of Food and Public Distribution serves as the central authority responsible for promoting the establishment of fuel-grade ethanol distilleries across the country.
- Ethanol Procurement: The government has approved the procurement of ethanol from sugarcane-based raw materials, surplus rice, and maize through the Food Corporation of India, ensuring a diversified supply for ethanol production.
- Ethanol Blended Petrol Program (EBP): Launched in 2003, the EBP Program aims to encourage the use of renewable fuels.
- Initially targeting a 5% ethanol blend, the program set a 10% blending goal by 2022, and a 20% blending target (E20) by 2030, which has now been advanced to 2025-26.
- National Policy on Biofuels : Introduced in 2018, this policy sets an indicative target of achieving a 5% biodiesel blend in diesel by 2030, supporting broader biofuel adoption.
- Differential Pricing: To compensate sugar mills for revenue losses due to reduced or zero sugar production, the government established higher prices for ethanol derived from B-heavy molasses and whole sugarcane syrup.
- Reduced GST: The Goods and Services Tax (GST) on ethanol designated for the Ethanol Blended Petrol (EBP) Program has been lowered from 18% to 5%, reducing costs and encouraging ethanol use.
- Interest Subvention Scheme: This scheme supports the expansion of ethanol production capacity by providing financial incentives, facilitating year-round ethanol production.
- Roadmap for Ethanol Blending (2020-25): Released by NITI Aayog, this roadmap outlines recommended measures for enhancing ethanol blending in India, providing a strategic framework for achieving blending targets.
Limitations of Ethanol Blending
- Feedstock Availability and Cost:
- Ethanol production relies on large quantities of biomass, competing with food and feed uses.
- Feedstock availability and costs fluctuate with seasons, market conditions, and policies.
- Conflict with Food Security:
- Ethanol production from corn directly impacts food security by diverting grain from food and livestock feed to fuel, linking food prices to crude oil demand.
- Conversion Efficiency and Yield:
- Ethanol production involves multiple steps, with varying efficiencies depending on feedstock type, process technology, and conditions.
- Lignocellulosic biomass, while abundant, requires complex processing, affecting yield and economic viability.
- Infrastructure and Distribution:
- Ethanol requires specialized infrastructure for transport and storage, involving high costs and logistical challenges.
- Its corrosive and hygroscopic nature complicates distribution through existing systems designed for gasoline.
- Vehicle Compatibility and Performance:
- Ethanol-blended fuels require vehicle modifications, affecting engine performance and maintenance.
- Ethanol’s lower energy density increases transportation and storage costs.
State-Level Perspectives on Ethanol Policy
- Uttar Pradesh:
- U.P. is the largest contributor to the ethanol blending program.
- The state government reserves 25% of ethanol for Extra Neutral Alcohol (ENA) production, although fuel ethanol offers higher value due to higher sugar content.
- Tamil Nadu:
- Ethanol blending has not gained as much traction in Tamil Nadu, where the government controls liquor sales.
- Water constraints limit the expansion of sugarcane cultivation, and political concerns may hinder the use of broken rice for ethanol production.
- Maharashtra:
- ENA production for other uses, such as manufacturing and medicine, is more profitable than ethanol blending in Maharashtra.
- The state’s booming economy drives demand for ENA, making it a preferred option over fuel ethanol.
Recommendations for Boosting the Ethanol Program
- Production Boost:
- Diversify Feedstock: Promote ethanol production from non-food sources like cellulosic biomass, waste paper, and agricultural residues to reduce competition with food security.
- Support 2G and 3G Biofuels: Invest in research and development of advanced ethanol production technologies using non-edible resources.
- Expand Production Capacity: Encourage the establishment of new distilleries and modernization of existing ones through financial incentives and streamlined processes.
- Promote Regional Production: Focus on setting up distilleries near fuel depots to minimize transportation costs and improve logistics.
- Policy and Market Mechanisms:
- Raise Blending Mandate: Gradually increase the mandatory ethanol blending percentage beyond 20% to create a stable market for ethanol producers.
- Long-term Contracts: Offer fixed-price contracts with OMCs to ensure stable investment in ethanol production.
- Support Research and Development: Invest in research to optimize blending ratios, address vehicle compatibility issues, and develop efficient conversion technologies.
- Technological Advancement:
- Upgrade Infrastructure: Invest in storage and transportation infrastructure to ensure efficient supply chain management for ethanol.
- Vehicle Compatibility: Collaborate with automobile manufacturers to develop engines and vehicles that can efficiently run on higher ethanol blends.
- Quality Control: Implement strict quality standards for ethanol production and blending to ensure consistent fuel performance and vehicle safety.
Conclusion
While India is on track to meet its ethanol blending targets, a balanced approach that considers food security, environmental sustainability, and economic viability is crucial. Diversifying into second and third-generation ethanol production and ensuring the equitable distribution of resources across states can help address these challenges. Continued government support and strategic planning will be essential to sustaining the momentum and achieving the broader goals of energy security and rural development.
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Related PYQ
Do you think India will meet 50 percent of its energy needs from renewable energy by 2030? Justify your answer. How will the shift of subsidies from fossil fuels to renewables help achieve the above objective? Explain. [ UPSC Civil Services Exam – Mains 2022]
Practice Question
Discuss the challenges and opportunities presented by India’s ethanol blending program. [150 words]