Minister of Petroleum and Natural Gas, Dharmendra Pradhan said that the Union Cabinet chaired by Prime Minister has approved the expansion of interest subvention scheme to provide financial assistance for enhancement of ethanol distillation capacity from grain-based distilleries along with molasses-based distilleries. The total outlay under the interest subvention scheme is estimated at ₹8,460 cr. The expanded interest subvention scheme will fuel investment of about ₹40,120 crore in the ethanol value chain, encouraging ‘Urja-Kheti, which will augment farmer’s income, transform our ‘annadatas’ into ‘urjadatas’ and contribute to the overall vision of Aatmanirbhar Bharat.
The Ethanol Blending Program (EBP) which started in 2003, got renewed thrust under the leadership of Prime Minister Narendra Modi. Due to progressive, reform oriented approach and series of steps taken in the last six years, ethanol procurement has gone up from 38 crore litres in 2013-14 with a value of around ₹1,500 cr to estimated procurement of 325 cr Litres in sugar year 2020-21, with an estimated value of ₹19,000 Cr. The price of ethanol procurement has also gone up from around ₹39 per litre in sugar year 2013-14 to an average price of ₹58 per litre in sugar year 2020-21. This progressive increase in prices has helped augment farmers’ income.
The blending percentage of ethanol in petrol has gone up from 1.53% in 2013-14 to 5% in 2019-20 and estimated to be 8.5% in 2020-21. The Government has setup an ambitious target of 10% ethanol blending by 2022 and 20% ethanol blending by 2030 which will require additional capacity to be added. Today’s decision will facilitate capacity addition and greater ethanol blending will immensely help in import substitution, savings of foreign exchange and environment sustainability.
