The Cabinet Committee on Economic Affairs (CCEA), chaired by the Prime Minister Narendra Modi, has approved revision of ethanol procurement price for Public Sector Oil Marketing Companies (OMCs) for the Ethanol Supply Year (ESY) 2024-25 starting from 1st November, 2024 to 31st October 2025 under the Ethanol Blended Petrol (EBP) Programme of the Government of India. Accordingly, the administered ex-mill price of ethanol for the EBP Programme derived from C Heavy Molasses (CHM) for the Ethanol Supply Year 2024-25 (1st November 2024 to 31st October 2025) has been fixed at Rs.57.97 per litre. The earlier CHM price was Rs 56.28.
The government said that the price approval will not only facilitate the continued policy for the Government in providing price stability and remunerative prices for ethanol suppliers but will also help in reducing dependency on crude oil imports, savings in foreign exchange and bring benefits to the environment.
There were various media reports stating that the government might hike the prices of ethanol produced from B-heavy molasses and sugarcane juice; however, the prices remained unchanged.
An increase in prices of CHM Ethanol by 3 per cent will assure sufficient availability of ethanol to meet the increased blending target.
The government has been implementing the Ethanol Blended Petrol (EBP) Programme wherein OMCs sell petrol blended with ethanol up to 20 per cent. This programme is being implemented across the country to promote the use of alternative and environment friendly fuels.
This intervention also seeks to reduce import dependence for energy requirements and give boost to agriculture sector.
During the last ten years, ethanol blending in petrol by Public Sector Oil Marketing Companies (OMCs) has resulted in approximate savings of more than Rs 113,007 crore of foreign exchange and crude oil substitution of about 193 lakh metric tonnes.
Ethanol blending by Public Sector Oil Marketing Companies (OMCs) has increased from 38 crore litre in Ethanol Supply Year 2013-14 (ESY – currently defined as the ethanol supply period from November 1, of a year to October 31, of the following year) to 707 crore litre achieving average blending of 14.60 per cent in ESY 2023-24.
The government has advanced the target of 20 per cent ethanol blending in petrol from earlier 2030 to ESY 2025-26 and a “Roadmap for ethanol blending in India 2020-25” has been put in the public domain.
As a step in this direction, OMCs plan to achieve 18 per cent blending during the ongoing ESY 2024-25. Other recent enablers include enhancement of ethanol distillation capacity to 1713 crore litre per annum; Long Term Off-take Agreements (LTOAs) to set up Dedicated Ethanol Plants (DEPs) in ethanol deficit States; encourage conversion of single feed distilleries to multi-feed; availability of E-100 and E-20 fuel; launch of flexi fuel vehicles etc.
“All these steps also add to ease of doing business and achieving the objectives of Atmanirbhar Bharat,” the government said.
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