Price of ethanol increased

3 Nov 2022 , 08:47 AM

In an effort to reduce India’s dependency on imported oil, the government increased the price of ethanol used to blend with gasoline on Wednesday.

For the supply year starting in December 2022, the Cabinet Committee on Economic Affairs (CCEA), led by Prime Minister Narendra Modi, increased the price of ethanol produced from sugarcane juice to Rs65.60 per litre from Rs63.45 per litre.

According to news reports, the price of ethanol produced from C-heavy molasses has grown to Rs49.40 per litre from Rs46.66 per litre, and the price of ethanol produced from B-heavy has decreased to Rs59.08 per litre from Rs60.73 per litre.

The government wants to increase the amount of ethanol that is now blended into gasoline (10% ethanol, 90% gasoline) by 2024—2025.

The third-largest oil consumer and importer in the world can lessen its dependency on international supplies by using ethanol, which is made from sugarcane, broken rice, and other agricultural products. India presently relies on imports for 85% of its oil requirements.

During the supply year ending November 30, 2022, ethanol was blended into gasoline in amounts of up to 452 crore litres. With a view to beginning bigger volumes of blending, 540 crore litres of procurement are being sought for the following year.

Since 2014, the government has announced the administered price of ethanol. The Government declared the differential pricing of ethanol based on the feedstock used to produce ethanol for the first time in 2018.

Because of these decisions, the supply of ethanol has significantly improved, and as a result, public sector oil marketing companies (OMCs) have increased their purchases of ethanol from contracts worth over 452 crore litres in the ongoing Ethanol Supply Year 2021—22 to 38 crore litres in the previous ESY 2013—2014.

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