To deal with lower capacity utilisation, the grain-based ethanol manufacturers have urged the government to increase blending in petrol marginally from the current level of 20% and explore the possibility of using biofuels based cooking stoves as complementary source of energy along with LPG.
“Currently ethanol manufacturing from grains – rice and maize – is operating at the capacities utilisation in the range of 40% to 90% across states, which may put investment at risk for the banks,” C K Jain, president, Grain Ethanol Manufacturers Association (GEMA) told FE. Jain has stated that ethanol blending with petrol can be increased by 2% to 3% from the current 20% level without any issues with the auto industry.
This increase in the blending would ensure lifting of an additional 2000 million litres of ethanol by oil marketing companies (OMCs) leading to higher capacities utilisation.
Capacity Crisis
At present, OMCs procure 11,000 – 12,000 million litres of ethanol made from sugarcane, rice and maize annually for 20% blending with petrol while the existing manufacturing capacity is of around 17,000 million litres. In the 2025-26 ethanol supply year (November-October), the OMCs have agreed to lift 10,500 million litres of ethanol, out of which 7500 million litres is to be contributed by the grain based biofuel markers while the rest is being sourced from sugarcane based units. Industry sources said that the OMCs will bid for another 2000 million litres in the second round.
Currently out of the total 400 ethanol manufacturers, around 250 units are grain based (rice and maize).
Beyond the Tank
The bio-fuels makers in a communication to Prime Minister Narendra Modi have suggested adoption of ethanol-based cook-stoves as a complementary option alongside LPG for both domestic households and commercial establishments such as restaurants, street vendors, and institutional kitchens.
GEMA has called for initiations of pilots in collaboration with departments, OMCs and institutions to examine the technical feasibility, safety standards and economic viability of ethanol based cooking solutions.
“This could help diversify India’s clean cooking energy mix, enhance resilience in the cooking fuel sector, and create new avenues for the utilization of domestically produced bio-fuels,” Jain, of GEMA stated.
The ministry of petroleum and natural gas recently stated that it is formulating a mechanism to address the issue of excess ethanol capacity with the sugar and food grain processing industry, in consultation with the ministry of food.
The options include easing export of ethanol and laying a road map for increasing the share of biofuel blended with petrol.