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India fast tracks adoption of ethanol-blended fuel to reduce emissions, cut costs

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NEW DELHI – India, the world’s third-biggest oil importer, has fast tracked a proposal to introduce petrol with a higher blend of ethanol in an effort to reduce its vehicular emissions and cut down on oil import costs.

While it is expected to also benefit Indian farmers, who produce sugar cane and grains used to make ethanol, concerns have been raised that a greater adoption of ethanol could have an adverse impact on the country’s food and ecological security.

Prime Minister Narendra Modi formally announced on June 5 – World Environment Day – the decision to advance the country’s target of 20 per cent ethanol blending in petrol, referred to as E20, by five years to 2025.

Oil marketing companies in India currently retail petrol with a 10 per cent ethanol blend. However, only around 50 per cent of the petrol sold in the country is E10 blended because of inadequate availability of ethanol.

A June 5 report by a government expert committee on ethanol blending in India estimates that the country will require around 10 billion litres of ethanol to meet its E20 target in 2025-26. This is triple the current requirement of 3.32 billion litres.

This increased demand for ethanol will be met by six million tonnes of sugar and 16.5 million tonnes of grains a year in 2025, a requirement that the country can support, according to the committee’s report.

India is also set to spend around 500 billion rupees (S$9 billion) to boost ethanol production, reported Bloomberg on June 11. Vehicles with E20 tuned engines, which are necessary to ensure optimum benefits for the fuel switch, are expected to be rolled out across the country from April 2025.

Among the many benefits cited behind the push for E20 is reduced oil import costs. The government estimates that a successful roll-out of the E20 programme can save around $5.3 billion a year in oil import costs. Reduced vehicular emissions is another advantage, with ethanol-blended petrol known to decrease emissions such as carbon monoxide and nitrogen oxides.

However, there are ecological concerns that the push for ethanol will incentivise greater farming of sugar cane and padi, which are water-intensive crops. Producing just one litre of ethanol from sugar requires about 3,000 litres of water. If successful, food crops and acreage meant for their cultivation could also end up being diverted for ethanol production.

Dr Jyoti Parikh, executive director of Delhi-based Integrated Research and Action for Development think-tank, said the push for ethanol adoption should factor in the overall cost from greater use of water and electricity for growing sugar cane and grains.

“It may be profitable for a few, but socially, you and I may be paying for it,” she said.

She added that the objectives of energy self-reliance and reducing emissions can be served better by the adoption of electric vehicles, which should get higher priority.

Usage of grains “unfit for human consumption” for ethanol production can also raise concerns. “This is a very sharp edge to drive on, particularly when free ration has to be provided to support the poor in a Covid-impacted economy,” she told The Straits Times.

Dr Parikh added that India could also look at importing ethanol. “It will provide a benchmark for the domestic price of ethanol and can reduce the ecological cost to our water and land-scarce economy that may come from producing ethanol entirely domestically,” she said.

The expert committee’s report recommends a switch to environmentally sustainable crops for ethanol production in the long run, including cereals, particularly maize, and second-generation biofuels. The latter includes non-edible oilseeds, used cooking oil, and agriculture residue such as rice straw or corn cobs.

The government has proposed setting up commercial as well as demonstration plants of second-generation biofuel refineries.

With most of India’s ethanol production capacity currently derived from molasses, there are concerns about the impact of sugar prices on ethanol availability. An increase in prices, for instance, could result in sugar cane molasses meant for ethanol being used for producing sugar instead. The expert committee has prescribed an approximately equal amount of ethanol production from molasses and grains in the coming years to reduce reliance on sugar cane.

Diversifying ethanol sources, especially through greater use of non-food biomass, is of critical importance, said Mr Vivek Chattopadhyaya, senior programme manager for air pollution at the Delhi-based Centre for Science and Environment.

“Any clean fuel programme must ensure consistent supply and affordable pricing. You have to price the cleaner fuel lower than regular fuel and supply inconsistencies can drive up costs,” he told The Straits Times.

A similar programme to promote biodiesel in India has not been as successful as expected because of poor commercial viability, including the unavailability of land for large-scale cultivation of jatropha, used to produce biofuel that is mixed with diesel, and poor yields.

The expert committee’s report has recommended tax relief on ethanol-blended fuel as well as tax incentives for vehicles compatible with E20 fuel.

Mr Chattopadhyaya added that further studies are needed to clearly establish the green credentials of using ethanol, including how much it reduces carbon dioxide emissions, as well as increased emissions of certain pollutants such as acetaldehyde vis-a-vis petrol.

Emissions from fossil fuel use in ethanol production and transport will also have to be factored into the overall evaluation of ethanol’s environmental impact.

“This is why we cannot be just end-use focused. We need to see how we can link energy security, food security¬†and farmers’ welfare, besides the obvious goals of emissions reduction, into a holistic road map to ensure ethanol adoption is an all-round success,” Mr Chattopadhyaya said.

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