For ESY 2024-25, favorable policies on ethanol pricing and feedstock availability will be crucial: Tarun Sawhney
Oil Marketing Companies (OMCs) have allocated 837 crore liters of ethanol for Ethanol Supply Year (ESY) 2024-25 (Cycle 1) out of 916 crore liters tendered, with manufacturers offering 970 crore liters. Feedstock availability will be key to meeting the target, with maize accounting for the largest share. India aims for 20% ethanol blending by 2025, supported by favorable policies on ethanol pricing, feedstock, and government assistance for distillery expansion.
Oil Marketing Companies (OMCs) have allocated around 837 crore liters of ethanol against tenders invited for the supply of 916 crore liters of ethanol for Ethanol Supply Year (ESY) 2024-25 – Cycle 1. Meanwhile, 970 crore liters of offers have been submitted by manufacturers across the country for ESY 2024-25. In the new ESY, feedstock availability will be crucial to meet the target.
Tarun Sawhney, Vice Chairman & Managing Director at Triveni Engineering and Industries Ltd said, “India remains focused on the Ethanol Blended Petrol (EBP) programme, which includes a stated target of 20% EBP for the Ethanol Supply Year (ESY) 2025-26. For ESY 2024-25 (November 2024 – October 2025), favorable policies on ethanol pricing and feedstock availability will be crucial for enabling distillery expansions and ensuring efficient production. The recent Central Government announcements on removing the cap on sugar diversion for ethanol production for ESY 2024-25 augurs well for the industry and the nation to meet the annual targets. Further notification by the Department of Food & Public Distribution allowed ethanol distilleries to participate in the auction of FCI (Food Corporation of India) for rice procurement. These initiatives are paving the way for the ethanol manufacturers to plan and achieve targets for the ESY 2024-25.”
“The industry must continue investing in new distilleries and expanding the existing ones to increase the ethanol production capacity particularly in molasses-based, grain-based, and dual-feed distilleries. Continued Government financial assistance and effective tripartite agreements between sugar mills, banks, and OMCs are essential for securing funding and facilitating ethanol sales. A clear regulatory framework for ethanol blending, coupled with constant policy support, will help stabilize profitability and ensure a market for ethanol producers. Moreover, infrastructure development for transportation and distribution of ethanol are also necessary to integrate ethanol into existing fuel supply chains”, he further added.
Sawhney emphasised that there needs to be feasible ethanol prices to ensure the smooth achievement of ethanol blending targets. He said, “At TEIL, we are actively contributing to India’s E20 program by producing high-quality ethanol at our distillation facilities, which can operate on a diverse range of feedstocks to mitigate dependency risks. However, viable pricing for each feedstock remains crucial to ensure continuous capacity expansion to meet the overall ethanol blending targets.”
In the given allocation, maize holds the largest share at 51.52 percent (around 431.1 crore liters), followed by sugarcane juice at 22.56 percent (around 188.7 crore liters), B Heavy Molasses at 13.61 percent (around 113.9 crore liters), damaged food grains at 11.22 percent (around 93.8 crore liters), and C Heavy Molasses at 1.09 percent (around 9.15 crore liters).
The government has set a target of achieving 20 percent ethanol blending with petrol by 2025 and is confident in reaching this goal.
