PM Modi: Government to raise target for ethanol blending of petrol

State-run oil marketing companies (OMCs) currently implement the EBP programme with the annual target of 5 per cent blending with ethanol, while India has targeted a 10 per cent blending of petrol with the biofuel by 2022

The government intends to further increase the target level for the Ethanol Blended Petrol (EBP) programme that aims to bring down India's imports of petroleum products, as also provide cleaner fuel, Prime Minister Narendra Modi said on Thursday.

State-run oil marketing companies (OMCs) currently implement the EBP programme with the annual target of 5 per cent blending with ethanol, while India has targeted a 10 per cent blending of petrol with the biofuel by 2022.

"Government intends to raise the target for a programme of blending petrol with ethanol, the production of which has crossed a record 140 crore litres this year," Modi said at the foundation stone laying event here for city gas distribution (CGD) projects across 129 districts in the country.

According to Petroleum Ministry officials, the target for the EBP programme could be increased to 20 per cent by 2030. India currently imports over 80 per cent of its oil requirements.

For the next ethanol supply year, that begins in December, OMCs have indicated a requirement of 329 crore litres of ethanol, which is more than double of this year, that will result in a blending rate of 10 per cent, officials said.

The government has already approved a hike in the price for the forthcoming year's procurement of ethanol by OMCs by over Rs 3, increasing the rate for the clean fuel derived out of B-heavy molasses from the current Rs 47.13 per litre to Rs 52.43.

In a decision taken in September, the Union Cabinet also decided to fix the ex-mill price of ethanol derived from 100 per cent sugarcane juice at Rs 59.13 per litre, from prevailing price of Rs 47.13, for those mills which will divert 100 per cent of sugarcane juice for production of ethanol, thereby not producing any sugar.

At the event, Modi also said that the government has budgeted a sum of Rs 5,000 crore for setting up compressed biogas plants over the next five years.

"It is also planned to set up 12 bio-refineries in the country with an investment of Rs 12,000 crore," he added.

According to officials, the 12 upcoming refineries will be owned by state-run companies like HPCL (four), IOCL (three), BPCL (three), MRPL (one) and Numaligarh Refinery (one).

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