As the government strives to enhance ethanol production, the industry is advocating for an increase in ethanol prices and a stable, long-term policy for ethanol blending. The government considers the ethanol blending program vital for fulfilling green energy commitments and strengthening the financial viability of sugar mills.
In an interview with ChiniMandi, Dr. Rahul Kadam, Chairman and Managing Director of Udagiri Sugar, highlighted the necessity of increasing ethanol prices to promote biofuel production. He stated, “We urge the government to adjust the procurement prices for various feedstocks used in ethanol production, taking into account the fair and remunerative price (FRP) of sugarcane. Raising these prices will not only enhance ethanol production but will also bolster the financial stability of sugar mills, enabling them to settle cane dues more efficiently.”
Currently, the price of ethanol derived from cane juice stands at ₹65.61 per liter, while ethanol from B-Heavy and C-Heavy molasses is priced at ₹60.73 and ₹56.28 per liter, respectively.
Kadam emphasized the need to address transportation rates and advocated for a long-term ethanol policy lasting 5 to 7 years to support and incentivize ethanol producers. These initiatives are expected to help sugar mills achieve the goal of 20 percent ethanol blending by 2025.
In August, the ethanol blending rate in petrol reached 15.8 percent, with cumulative blending from November 2023 to August 2024 reaching 13.6 percent.
Recently, the government has permitted sugar mills and distilleries to produce Rectified Spirit (RS) and Extra Neutral Alcohol (ENA) from sugarcane juice and B-Heavy molasses. Furthermore, the production of ethanol from sugarcane juice, B-Heavy molasses, and C-Heavy molasses is now allowed during the Ethanol Supply Year (ESY) 2024-25. The government has also lifted a previous ban, enabling the sale of up to 23 lakh tonnes of rice from Food Corporation of India (FCI) stocks to grain-based ethanol distilleries.
According to the Department of Food & Public Distribution (DFPD), India’s ethanol production capacity has surged from 518 crore liters in 2017-18 to an impressive 1,623 crore liters as of August 31, 2024, reflecting the government’s commitment to a greener future.
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