India’s ethanol production capacity is experiencing significant expansion, which is expected to drive the country’s overall production levels higher.
As of November 30, 2024, India’s ethanol production capacity has reached 1,685 crore liters. This includes 744 crore liters from grain-based distilleries and 941 crore liters from molasses-based distilleries, according to the Department of Food & Public Distribution (DFPD).
The government has been rolling out the Ethanol Blended with Petrol (EBP) Programme nationwide, which requires Oil Marketing Companies (OMCs) to sell petrol blended with ethanol. The goal is to achieve a 20% ethanol blending target by 2025 under this initiative.
With the expanded production capacity, the government is confident that it will be able to meet domestic ethanol demand. However, to reach the 20% blending goal, an estimated 1,016 crore liters of ethanol will be needed, bringing the total required to 1,350 crore liters when factoring in other uses. By 2025, it is projected that ethanol production will need to reach around 1,700 crore liters, assuming plants operate at 80% efficiency.
In the Ethanol Supply Year (ESY) 2023-24 (Nov 2023 – Oct 2024), cumulative ethanol blending in petrol reached 14.6%.
For ESY 2024-25, OMCs have allocated 837 crore liters of ethanol for supply against tenders for 916 crore liters in Cycle 1. Recently, they also invited bids for the supply of approximately 88 crore liters of denatured anhydrous ethanol for the fourth quarter (Cycle 2) of ESY 2024-25.
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