Monday, July 22, 2024

PM Modi to launch blended petrol on Monday, 2 years ahead of target


PM Narendra Modi will launch E20, or petrol blended with 20% ethanol, in Bengaluru on Monday, bringing forward by two years the launch of cleaner-burning version of the common man’s fuel with the dual purpose of reducing oil imports and vehicular emission.

“The PM will launch the fuel by pressing a nozzle at the ‘India Energy Week’ conference to start E20 sale at some 67 pumps on pilot basis across several states. We started at 1.4% ethanol blending in 2014 and achieved 10% blending five months ahead of the November 2022 target. The original target of 20% blending was 2030. We revised it to 2025 and then to 2023. We’re introducing it in the market months in advance,” a top government functionary said.

He said the pace of implementation of the ethanol blending programme and several other initiatives underway simultaneously across the energy value chain underlines the Modi government’s commitment to clean energy transition and climate commitment and the investment opportunities they provide.

The PM will also launch an indigenous solar-electric cooktop, which will provide a low-carbon, low-cost cooking option for households. Built by IndianOil’s R&D wing, the cooktop is comparable to modern induction cooktops and operates on solar and grid power. “This will be India’s gift for the world,” he said, adding the Gates Foundation and other entities have evinced interest due to the cooktop’s application potential in the global south.

The oil ministry is exploring the cooktop’s inclusion in the renewable energy’s subsidy plan for solar pumps, known as Kusum, or similar support, as its initial cost of around Rs 10,000 could be daunting for households. “The price will come down to affordable levels once scale is achieved,” he said.

The PM is slated to launch a programme for recycling PET bottles into fabric by the three state-run oil refiner-cum-fuel retailers, scaling up an initiative launched last year by IndianOil. The fabric will be used to make uniforms for petrol pump attendants and supplied to the armed forces.

Additional Information:

What is ethanol?

  • It is the organic compound Ethyl Alcohol which is produced from biomass.
  • It is also an ingredient in alcoholic beverages.
  • It has a higher octane number than gasoline, hence improves the petrol octane number.
  • It is obtained primarily from sugarcane.

Where and how is the ethanol blended?

  • Indian Oil Corporation Ltd. blends ethanol at its terminals at Tiruchi, Coimbatore, Salem and Madurai.
  • Hindustan Petroleum Corporation Ltd blends the bio-fuel with petrol at its terminal in Chennai, while Bharat Petroleum Corporation Ltd. in terminals in Chennai and Karur.
  • stream of ethanol stored in a tank is loaded through a separate pumping and metering mechanism into the petrol loading arm at terminals.

How much does ethanol cost?

  • A litre of ethanol currently costs ₹61.
  • But its price depends on internal fuel prices.
  • There is however no change in the price of petrol or motor spirit, as it is called, due to ethanol blending.
  • The consumer pays for a litre of petrol only.

What has happened?

  • Ethanol blending in India has reached more than 7.2% — the first time it has reached this level — in the first four months of the ethanol supply year 2020-21 (December to November), Putting the country on course to meet the target of 10% blending by 2022.
  • According to industry sources, if oil-marketing companies (OMCs) lift the ethanol they had contracted for,
  • In the next few months all-India average blending could be even near 8% by the time the season ends in November.
  • So far, the best ever ethanol blend with petrol has been around 2% at all-India level.

Better in few states

  • In states such as Goa, Karnataka, Maharashtra, Gujarat, Uttar Pradesh, Haryana, Punjab, Delhi, Uttarakhand, and Himachal Pradesh (and Daman and Diu, a Union Territory), 5-10% ethanol is being blended with petrol.
  • This means these states are close to the 2022 target.

The Problem

  • But, it hasn’t been all smooth so far.
  • Sugar industry players say blending could have been more in the first four months of the 2020-21 season but for some strategic errors by OMCs in estimating the storage capacity.
  • Owing to this, mills are being compelled to supply ethanol to depots far from their production units.
  • According to the ethanol policy, sugar companies are under obligation to deliver the contracted ethanol to the nearest OMC depot, for which OMCs are supposed to pay the transportation charges.
  • However, sugar companies say OMCs do not do the full reimbursement because the base rate was fixed in October last year (before the current spurt in fuel prices).
  • This is why sugar companies have to bear an additional burden of Rs 3-5 per litre.
  • Diesel rates have gone up by more than 25% since October.
  • Sugar companies want the base rate revised.
  • The problem of reimbursement has also become acute because in several cases OMCs have changed the ethanol delivery depot early in the season,
  • Because the ones preferred by sugar companies near their plants aren’t empty.
  • The relocated depots are situated in states which have just initiated the blending programme and therefore they don’t have the adequate infrastructure to handle ethanol.
  • This has pushed up the turnaround time of tankers containing ethanol from one-two days to 15-20 days.

Source: TOI, Studyiq


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