Ethanol Blending Programme Current Affairs - 2020

Implementation Updates: National Biofuel Policy

The Ministry of Petroleum and Natural Gas notified a new National Policy on Biofuels in June 2018. On a written reply at the opening session of Lok Sabha on November 18, 2019, the Ministry of Petroleum and Natural Gas provided its implementation steps.

Government measures and achievements

  • The percentage of Ethanol in Ethanol blended petrol has been increased from 1.53% in 2013-14 to 4.22% in 2017-18
  • GoI has procured 180 crore litres of ethanol against the target of 225 crore litres for the year 2018-19
  • The total Ethanol production capacity of the country is 355 crore litres per annum.

Current Government schemes on Biofuels

  • The Sustainable Alternative Towards Affordable scheme aims at establishing 5000 compressed bio gas plants across the country by 2023.
  • The Oil Marketing Companies that are part of the Ethanol Blended Petrol Programme can sell blended petrol with maximum ethanol percentage of 10%.

Salient Features of the Policy

  • The Biofuels will be categorized as Basic Biofuels and Advanced Biofuels.
  • Government will provide incentives, viability gap funding and off-take insurance for advanced biofuels. Advanced Biofuels are derived from non-food feedstocks. They are also known as second-generation biofuels.
  • According to the new policy, B-molasses, damaged food grains, sugarcane juice and surplus food grains can be used for ethanol production
  • A supply chain will be set up for the production of biodiesel. It is to be produced from non-edible oil seeds, short gestation crops and used cooking oil
  • The Policy defines the roles and responsibilities of all the ministries and other concerned departments that are involved in production and supply of Biodiesel.

CCEA approves Pradhan Mantri JI-VAN Yojana

The Cabinet Committee on Economic Affairs has approved the “Pradhan Mantri JI-VAN (Jaiv Indhan- Vatavaran Anukool fasal awashesh Nivaran) Yojana” under the Ministry of Petroleum & Natural Gas to provide financial support to Integrated Bioethanol Projects using lignocellulosic biomass and other renewable feedstock.

Pradhan Mantri JI-VAN

  • The scheme aims to incentivise 2G Ethanol sector and support this nascent industry by creating a suitable ecosystem for setting up commercial projects and increasing Research & Development in this area.
  • Under the scheme  12 Commercial Scale and 10 demonstration scale Second Generation (2G) ethanol Projects will be provided with a Viability Gap Funding (VGF) support in two phases:
  • Phase-I (2018-19 to 2022-23): Six commercial projects and five demonstration projects will be supported.
  • Phase-II (2020-21 to 2023-24): Six commercial projects and five demonstration projects will be supported.
  • The ethanol produced by the scheme beneficiaries will be mandatorily supplied to Oil Marketing Companies (OMCs) to further enhance the blending percentage under the ethanol blending programme.

Objectives of the Scheme

  • Accomplishing the Government of India vision to reduce import dependence by way of substituting fossil fuels with Biofuels.
  • Meeting of the GHG emissions reduction targets through progressive blending/ substitution of fossil fuels.
  • Addressing environmental concerns caused due to the burning of biomass/ crop residues & to improve the health of citizens.
  • Augmenting the farmer’s income by providing them remunerative income for their otherwise waste agriculture residues.
  • Creation of rural & urban employment opportunities in 2G Ethanol projects and Biomass supply chain.
  • Complementing the Swacch Bharat Mission by supporting the aggregation of non­food biofuel feedstocks such as waste biomass and urban waste.
  • Indigenizing of Second Generation Biomass to Ethanol technologies.

The government has set the target to achieve 10% blending percentage of Ethanol in petrol by 2022. The challenges like higher ethanol prices and simplification of the ethanol purchase system have become a hindrance. The highest ever ethanol procurement stood at around 150 crore litres during 2017-18 which is sufficient for around 4.22% blending on Pan India basis.

Hence to create 2G Ethanol capacity in the country and attract investments in this new sector Pradhan Mantri JI-VAN Yojana has been launched by the government.