22 July 2024 – The Hindu

Ethanol Production in India

• India is walking a tightrope when it comes to meeting its aim of blending ethanol, given that over 100 nations at COP28 in Dubai committed to tripling the amount of renewable energy produced globally by 2030. While Ethanol Blended Petrol (EBP) climbed from 1.6% in 2013–14 to 11.8% in 2022–23, low sugar supplies in 2022–23 and the upcoming shortage in sugarcane production this year have caused issues for the 20% objective by 2025. The Minister of Consumer Affairs has made it clear that in order to accomplish the goal, the government plans to make a significant shift to ethanol derived from grains.
• An organised maize-feed supply chain for ethanol will be bolstered by the recent authorization of the National Agricultural Cooperative Marketing Federation of India (NAFED) and the National Cooperative Consumers’ Federation of India (NCCF) to purchase maize (corn) for supplying ethanol distilleries. This authorization highlights the importance of this transition. But doing so runs the danger of making the economy face further difficulties.

What is meant by ethanol?

• Ethanol: An organic substance, ethanol is a clear, colourless liquid that burns easily and has a distinct smell.
• Production: Yeast fermentation, which is also how alcoholic beverages are made, is one way to produce it from sugar. Additionally, it can be produced chemically by doing things like hydrating ethylene.

Applications:

• Drinks: The sort of alcohol contained in alcoholic beverages is called ethanol. It is ingested in social contexts in a variety of forms, including wine, spirits, and beer.
• Fuel: It can be used as a biofuel and is frequently blended with petrol to create fuels containing ethanol.
• Industrial Solvent: Ethanol is employed as a solvent in the production of medications, fragrances, and other goods because of its broad dissolution range.
• Applications in Medicine and Laboratories: In medical and laboratory settings, ethanol is employed as a preservative, antiseptic, and disinfectant.
• Chemical Feedstock: It is used as a raw material to make different kinds of chemicals.

The Ethanol Blending Programme (EBP): What is it?

• The Indian government launched the EBP programme to encourage the use of ethanol, an environmentally benign and renewable fuel, in petrol.
• The program’s objectives are to decrease foreign fuel imports, preserve foreign exchange, and boost value addition in the sugar sector.
• The “Roadmap for Ethanol Blending in India 2020-25” established a 10% ethanol blending objective for the Ethanol Supply Year (ESY) 2021–2022. This target has now been met, and Public Sector Oil Marketing Companies (OMCs) have begun selling E20 (20% ethanol blended) petrol throughout the nation.
• Furthermore, by ESY 2025–2026, 20% of petrol will contain ethanol, according to the National Policy on Biofuels – 2018.
• Molasses, a byproduct of the sugar industry, is the primary raw material used to make ethanol; other raw materials include sugarcane juice, sugar, sugar syrup, and damaged food grains.
• In order to make the purchase and delivery of ethanol under the EBP easier, the government has implemented a number of measures, including setting fair prices, streamlining the process, eliminating excise taxes, and providing financial support.
• The supply of ethanol to OMCs has increased by more than 13 times in ESY 2022–23 from ESY 2013–14 thanks to efficient government measures.
• Additionally, from 1.53% in ESY 2013–14 to the planned 12% in ESY 2022–2023—the blending percentage has increased.

Why Does Blending Ethanol Into Fuels Matter?

• Reducing Dependency on Fossil Fuels: Since India imports the majority of its oil, it is susceptible to changes in international markets and geopolitical threats. India can boost its energy independence and decrease its reliance on foreign oil by utilising ethanol.
• Preserving the Environment: Since ethanol burns more cleanly than petrol, it emits less toxic pollutants that contribute to air pollution and global warming. India can accomplish its climate goals and enhance air quality by utilising ethanol.
• A study conducted by the Indian Institute of Science, Bangalore, found that adding ethanol to petrol can cut emissions of hydrocarbons by 20% and carbon monoxide by 30–50%.
• Helping Farmers: Crop inputs like corn or sugarcane are needed for the manufacturing of ethanol. India may increase the demand for these products by using ethanol, which will improve farmers’ and rural populations’ income and standard of living.
• Improving Energy Security: India’s reliance on a single, foreign energy source can be lessened thanks to ethanol, a native and varied energy source. India can improve its energy resiliency and security by utilising ethanol.
• Gaining Economic Benefits: By encouraging the expansion of the ethanol sector, blending can lead to the creation of new employment, capital, and inventions. It can also assist India in creating a more cutting-edge and sustainable energy system.
• Blending ethanol can save the nation USD 4 billion (about Rs. 30,000 cr) annually.
• Enhanced Vehicle Performance: Because ethanol has a greater octane rating than gasoline, it helps minimise knocking and enhance engine performance.

What Are the Restrictions on Blending Ethanol?

• Feedstock Availability and Cost: A significant quantity of biomass, such as sugarcane, corn, or lignocellulosic materials, are needed for the manufacture of ethanol and may compete with food, feed, or other purposes. The cost and availability of various feedstocks might change based on the time of year, the market, the weather, and the state of policy.
• Conflict with Food Security: There is a direct conflict between food security and the usage of maize for the production of ethanol.
• When it comes to sugarcane, ethanol is made by processing the molasses (which are C- and B-heavy), and the amount of sugar produced is minimally traded off.
• While the B-heavy molasses approach yields more sugar than the C-heavy one, both routes use sugarcane to concurrently make ethanol and sugar.
• However, corn’s use as food or animal feed is immediately decreased when it is used to produce ethanol.
• Not only does it redirect grain towards fuel consumption, but it also establishes a direct demand-side relationship between food prices and crude oil prices.
• Conversion Efficiency and Yield: The production of ethanol entails a number of phases, including pretreatment, hydrolysis, fermentation, and distillation. Depending on the feedstock’s quality and type, the process technology, and the operating circumstances, these steps may have varying conversion efficiencies and yields.
• For instance, more extensive and sophisticated pretreatment and hydrolysis are needed for lignocellulosic biomass, which is more varied and abundant than maize or sugarcane, in order to convert the cellulose and hemicellulose into fermentable sugars.
• The economic feasibility and environmental impact of the production process are also influenced by the yield and conversion efficiency of ethanol.
• Infrastructure and Distribution: In order to move, store, and provide the gasoline and feedstock to the final consumers, ethanol production needs a sufficient infrastructure and distribution systems. This could entail significant startup and ongoing expenses, in addition to logistical and legal difficulties.
• Because ethanol, for instance, is corrosive and hygroscopic, it might pollute or damage existing pipelines, tanks, and pumps used for petrol or diesel.
• Vehicle Performance and Compatibility: Vehicles that can run on pure ethanol or fuel blends that are compatible and efficient are needed for the generation of ethanol. This might necessitate adjustments or upgrades to the cars’ engines, fuel systems, and pollution control systems in addition to adjustments to the drivers’ maintenance schedules and driving styles.
• For instance, ethanol has a lower energy density than petrol, requiring a larger volume of the fuel to provide the same amount of energy. This leads to increased expenses for storage and transportation of ethanol.
• What Actions Has the Government Taken to Encourage the Blending of Ethanol?
• Differential Ethanol Pricing: The price of ethanol made from damaged food grains or rice, sugarcane juice, sugar, or sugar syrup, and B and C heavy molasses and syrups has been set by the government.
• The Cabinet Committee on Economic Affairs (CCEA) reviews the prices every year taking into account a number of variables such demand, availability, and manufacturing costs.
• In order to meet the goal of 20% ethanol blending in gasoline by 2025, the differential pricing strategy has led to an increase in the supply of ethanol for the Ethanol Blended Petrol (EBP) programme.
• Interest Subvention Scheme: The government has announced a number of ethanol interest subvention schemes that will run from July 2018 to April 2022 in an effort to increase the nation’s capacity for producing ethanol and meet the blending targets outlined in the EBP Programme.
• The government is helping business owners establish new molasses-based, grain-based, and dual-feed distilleries or expand already-existing molasses-based, grain-based, and dual-feed distilleries across the nation through various ethanol interest subvention schemes.
• For a period of five years, including a one-year moratorium, the Central Government will bear interest subvention at 6% annually or 50% of the interest rate charged by banks and other financial institutions, whichever is lower, on loans to be provided by these entities.
• Tax relief: Since E10 and E20 blends pay less in taxes than unblended petrol, customers will find them to be more affordable.
• GST and excise taxes on ethanol are lower than those on fuel.
• Incentives for E20-compatible cars: Manufacturers and purchasers of cars that can handle greater ethanol blends are being offered tax breaks and other incentives.

What More Actions Can Be Done to Strengthen the Ethanol Programme?

Increased Production:

• Diversify your feedstock by promoting the use of non-food sources such as waste paper, cellulosic biomass, and agricultural wastes. This makes use of trash and lessens rivalry with food security.
• Encourage the Development of 2G and 3G Biofuels: Make research and development investments in the technology for producing ethanol from non-edible resources in the second and third generations.
• Increase Production Capacity: Provide financial support and reduced bureaucratic procedures to encourage the establishment of new ethanol distilleries and the modernization of existing ones.
• Encourage Regional Production: To save money on shipping and improve logistics, concentrate on building distilleries near gasoline depots.

Market Mechanisms and Policy:

• Raise Blending Mandate: By 2025, gradually raise the required proportion of ethanol blending over the current 20% target. This guarantees a market for producers of ethanol.
• Long-term Contracts: To promote consistent investment in ethanol production, provide oil marketing companies fixed-price contracts.
• Encourage research and development by allocating funds for studies on blending ratio optimisation, engine compatibility, and the creation of effective conversion technologies.

Progress in Technology:

• Upgrade Infrastructure: To guarantee effective supply chain management, make investments in ethanol storage and transportation infrastructure.
• Vehicle Compatibility: Develop engines and cars that are compatible with greater ethanol mixes by working with automakers.
• Quality Control: To guarantee fuel efficiency and vehicle safety, establish strict quality requirements for ethanol manufacturing and mixing.

Public Education and Awareness:

• Launch Awareness Campaigns: Inform people about the advantages of blending ethanol, debunk rumours about how it affects cars, and promote its use.
• Transparency and Labelling: Make sure that ethanol blended fuels at petrol stations are clearly labelled to let customers know what options they have.

Way Forward:

• India’s programme for blending ethanol has advanced significantly. Over the last eight to ten years, this accomplishment has increased India’s energy security and resulted in savings of over Rs. 41,500 crores in foreign exchange, a decrease in Green House Gas (GHG) emissions of 27 lakh Metric Tonne (MT), and the prompt payment of over Rs. 40,600 crores to farmers.