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New Delhi: In what may add heft to India’ green energy credentials, the union government will direct oil companies to sell up to 20% ethanol blended petrol from 1 April 2023.

The government has been pushing for ethanol production with surplus sugar production depressing sugar prices and consequently increasing the dues of sugarcane farmers. This comes against the backdrop of protests by farmers against the new farm laws.

“To commemorate World Environment Day, Government of India is releasing E-20 Notification directing Oil Companies to sell ethanol blended petrol with percentage of ethanol up to 20% from 1st April 2023; and BIS Specifications for higher ethanol blends E12 & E15," the Prime Minister's Office said in a statement on Friday.

Increased ethanol blending with fossil fuels will help reduce pollution and strengthen India’s resolve towards fulfilling commitments made at COP-21, the UN Climate Change Conference held in France in 2015. It will also help lower India’s energy import dependency and lead to lowering the crude oil import bill.

While participating in the World Environment Day event on Saturday, Prime Minister Narendra Modi will release the “Report of the Expert Committee on Road Map for ethanol blending in India 2020-2025".

The blending percentage of ethanol with petrol has gone up from 1.53% in 2013-14 to 8.5% in 2020-2. The National Biofuel Policy 2018 envisages an indicative target of 20% blending of ethanol in petrol and 5% blending of biodiesel in diesel by 2030.

“These efforts will facilitate setting up of additional ethanol distillation capacities and will provide timelines for making blended fuel available across the country. This will also help increase consumption of ethanol in the ethanol producing states and the adjoining regions, before the year 2025," the statement added.

This comes in the backdrop of the Cabinet Committee on Economic Affairs (CCEA) in December approving a 8,460 crore modified scheme for extending interest subvention for those setting up standalone ethanol distilleries. The focus is for increasing India’s ethanol production capacity, with the scheme extended to those setting up distilleries using grain, molasses, dual feed, sugar beet, sweet sorghum, and cereals as a feedstock.

"Prime Minister will launch a Pilot Project of E 100 dispensing stations at three locations in Pune," the statement added.

India has an ethanol production capacity of 684 crore litre. For the targeted 20% blending of ethanol in petrol by 2030, the country will need a 1,000-crore litre capacity.

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