CCEA approves hike in ethanol price

In a bid to curb India’s dependency on imported crude oil, the Cabinet Committee on Economic Affair has approved a hike in the price of ethanol used for blending in petrol for the forthcoming sugar season 2022-23 during Ethanol Supply Year (ESY) 2022-23.

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New Delhi, Nov 3: The price of ethanol from C heavy molasses route will be increased from existing Rs.46.66 per litre to Rs.49.41 per litre. The price of ethanol from B heavy molasses route be increased from Rs.59.08 per litre to Rs.60.73 per litre and the price of ethanol from sugarcane juice/sugar/sugar syrup route be increased from Rs.63.45 per litre to Rs.65.61 per litre.

At present, the Oil Marketing Companies or OMCs sell petrol blended with ethanol up to 10% (rest 90% petrol). The central government, however, is aiming at a target for selling 20% ethanol blended petrol (EBP) by about five years from the earlier deadline of 2030. The target of achieving average 10% blending has been achieved in June, 2022, much ahead of the target date of November, 2022.

In an official statement, it has been stated, “All distilleries will be able to take benefit of the scheme and a large number of them are expected to supply ethanol for the EBP programme. Remunerative price to ethanol suppliers will help in early payment to cane farmers, in the process contributing to minimize difficulty of sugarcane farmers.”

The Government has been implementing Ethanol Blended Petrol (EBP) Programme throughout the country except Union Territories of Andaman Nicobar and Lakshadweep islands from 1st April, 2019 to promote the use of alternative and environment friendly fuels. The said intervention by the government also seeks to reduce import dependence for energy requirements and give a boost to the agriculture sector.

For the first time during 2018, the differential price of ethanol based on feed stock utilized for ethanol production was announced by the Government. The central government states that the these decisions have significantly improved the supply of ethanol, consequently ethanol procurement by Public Sector OMCs has increased from 38 crore litre in Ethanol Supply Year 2013-14 (ESY – currently defined as ethanol supply period from 1st December of a year to 30th November of the following year) to contracts of over 452 crore litre in ongoing ESY 2021-22.