Public sector oil marketing companies have introduced an incentive of Rs 6.87 per litre for the production of ethanol from C-heavy molasses, a by-product of sugar factories. This move aims to encourage a green economy and enhance ethanol availability for the ethanol-blended petrol programme.
C-molasses, being a by-product of sugar factories, provides an effective and sustainable route for ethanol production. The oil companies anticipate that this incentive will stimulate ethanol production from C molasses, contributing to the success of the ethanol blended petrol programme.
Union Petroleum Minister Hardeep Puri lauded the initiative in a tweet, emphasizing its role in ensuring farmers’ prosperity, conserving foreign exchange, and promoting sustainability. He highlighted that this incentive supports the government’s vision for a cleaner and more eco-friendly future through the Ethanol Blended Petrol Programme, under the leadership of Prime Minister Narendra Modi.
Earlier in December, the Food Ministry directed sugar mills to refrain from using cane juice or syrup to produce ethanol. Subsequently, the central government permitted the use of juice and B-heavy molasses for ethanol production while limiting the diversion of sugar at 17 lakh tonnes for the current marketing season.
However, the government’s ambitious targets of achieving 20% ethanol-blended petrol by 2024-25 and 30% by 2029-30 face potential setbacks due to the halt of ethanol production from sugarcane juice in the 2023-24 season, as reported by Crisil.
Currently, ethanol from cane juice constitutes 25-30% of the total ethanol produced in the country, while ethanol from B heavy molasses accounts for over 60-65%. The remaining percentage comes from ethanol produced from C heavy molasses and grains.
India has already initiated the rollout of 20% blended fuel (E20) in petrol in April 2023, aiming to reduce oil import costs, enhance energy security, lower carbon emissions, and improve air quality. The government accelerated the target for E20 fuel from 2030 to 2025.