India’s ethanol production capacity is experiencing significant growth, which is expected to boost the country’s overall production.
India’s ethanol production capacity has grown substantially, now reaching 1,685 crore liters. According to the Department of Food & Public Distribution (DFPD), existing capacity of ethanol production in the country (as on 30th November 2024) has increased to 1685 crore litres (744 crore litres of grain based and 941 crore litres of molasses-based distilleries).
The government has been implementing the Ethanol Blended with Petrol (EBP) Programme nationwide, under which Oil Marketing Companies (OMCs) sell petrol blended with ethanol. The government has set a target of achieving 20% ethanol blending with petrol by 2025 under this programme.
The government is optimistic that this expanded capacity will meet the country’s domestic ethanol needs. However, to achieve the 20% blending target, approximately 1,016 crore liters of ethanol will be required, totaling 1,350 crore liters when accounting for other uses. By 2025, it is estimated that an ethanol production capacity of around 1,700 crore liters will be necessary, assuming plants operate at 80% efficiency.
Cumulative ethanol blending in petrol during the Ethanol Supply Year (ESY) 2023-24 (Nov 2023 – Oct 2024) reached 14.6%.
In ESY 2024-25, OMCs have allocated around 837 crore liters of ethanol against tenders for the supply of 916 crore liters in Cycle 1. Recently, OMCs invited bids for the supply of around 88 crore liters of denatured anhydrous ethanol for Q4 (Cycle 2) of ESY 2024-25.
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