Opinion: The E20 Challenge: The Road to Clean
Mobility through Ethanol Blending

OMI Foundation
4 min readAug 5, 2022

By Adhnan Nazir Wani

Achieving 10% ethanol blending in petrol (E10) five months ahead of its target marks a milestone for India’s bid for clean mobility through biofuels. It also reflects its rapid pace of ethanol production, having grown from 38 crore litres in FY 2013–14 to 867 crore litres in FY 2022–23. This, in turn, has helped reduce up to 27 lakh metric tonnes (MT) of vehicular greenhouse gas (GHG) emissions in the last 8 years. The country is now gearing up for the E20 challenge thrown open by the leadership’s commitment to achieving a 20% blend in petrol by FY2025–26. Reaching this goal would need up to 1,700 crore litres of annual ethanol production. However, the biomass pathway deployed to meet these targets needs to be looked at through a critical lens.

Source: Rawpixel from Freepik

A mainstream biofuel, ethanol, is classified into 3 generations, based on the nature of the feedstock. 1G ethanol is typically derived from sugar-rich food crops; 2G ethanol is primarily based on surplus biomass, agricultural waste and energy crops while 3G ethanol is at a relatively nascent stage of development, derived from algae.

Most of India’s ethanol production comes from 1st generation feedstock, primarily sugarcane molasses. It is sold and distributed to Oil Marketing Companies (OMCs) for blending with petrol under the Ethanol Blending Programme (EBP). The revised targets of this programme prioritise diversified feedstock, which includes edible biomass like corn and the unused surplus of Food Corporation of India (FCI) rice. A modified Interest Subvention Scheme for setting up new grain-based first-generation distilleries is expected to hasten production. If realised, the E20 programme could reduce carbon monoxide emissions by 30–50% and hydrocarbon emissions by 20%.

However, only 40% of the ethanol produced in the country is used for fuel blending, the rest goes into more consumable streams like liquor and chemical production. This puts 1st generation ethanol at loggerheads with other competing applications — critically food security, which risks getting compromised at the altar of clean energy. This is where 2G ethanol, based on non-food biomass like wheat straw, rice straw and crop stubble, comes in handy. With India ranked 94th in the Global Hunger Index 2020, the 2G ethanol route, even though potentially slower, vows to be more sustainable and circular economy friendly.

The National Policy on Biofuels, which provides an overarching framework for biofuel promotion in the country, lays emphasis on second-generation ethanol production. The policy indicates a viability gap funding with tax benefits for 2G ethanol biorefineries in phases across 12 projects, which would be supported under the Pradhan Mantri JI-VAN Yojana. However, setting up a 2G ethanol plant costs around ₹1000 crore, which is 5–10 times more expensive than an equivalent 1G plant, discouraging OMCs from investing.

Brazil is hard to overlook when speaking about ethanol. The country boasts of the world’s most successful ethanol-blending programme. It has adopted standards that require a minimum 27% ethanol blend in petrol. Low-interest loans for setting up refineries, a price differential against petrol favourable to ethanol, aggressive marketing and investments in nationwide distribution have propelled its growth. Brazil’s ethanol production has primarily relied on sugarcane molasses, but now is being dominated by its genetically modified cousin called ‘energy cane’. Energy cane is cultivable on dry and low-fertility soil and is up to 4 times more productive than traditional sugarcane. Being an advanced biofuel feedstock, its application in India holds a lot of promise.

The ethanol boom in Brazil has also been accompanied by the explosive growth of Flex-Fuel Vehicles (FFVs). FFVs can support all blends of ethanol from E0 to E100. Over 70% of vehicles currently running in Brazil are FVVs. For India, the introduction of the PLI (Production Linked Incentive) for manufacturing FFV engine components is likely to provide an impetus for the manufacturers to develop advanced technologies around it.

While developing engine technologies to support the E20 blend may seem like a good interim solution, prepping future-ready FFVs could turn out as a good strategic move. Ethanol addition to petrol results in better oxidation, reduction of engine knocking and reduced tailpipe emissions, but engines supporting lower blends usually face niggles. A drop in efficiency levels, performance characteristics and longevity of components are the main drawbacks. FFVs are also likely to have a higher upfront cost due to upgraded engine parts. A generational transition for every blend increment could become a hurdle for automobile manufacturers already having invested in shifting to BS-VI norms and EV adoption. Therefore, sustainable models for retrofitting flex-fuel engine components in older vehicles could also be explored.

As India aims for global leadership in renewable energy transition, ethanol-blended fuel and FFVs could be the intermediate solution for phased decarbonisation of road transport. While efforts to boost consumption by imposing excise duty on unblended fuel are a good pressure point, the production pathway for ethanol requires a sustainable approach. Future strategies in the EPB could focus on ensuring strong financial support and R&D for 2G ethanol refineries while advocating a radical shift to FFVs over smaller increments in fuel technology.

Adhnan Nazir Wani is Researcher, Energy & Mobility, OMI

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