In an interesting coincidence, the Centre issued a directive mandating 20 per cent ethanol use in high octane petrol, just days before the Iran war broke out. To place in perspective the import of this step which will come into effect from April 1, petrol substitution has translated into savings of ₹1.4 lakh crore in foreign exchange since 2014. Ethanol blending can make a big difference to India’s petroleum imports of at least $150 billion, at current over-the-roof prices. But the virtues and demerits of ethanol go beyond savings in the import bill.
By all accounts, ethanol blending of about 20 per cent has already been achieved. What the latest directive seeks to do is to formalise the arrangement across petrol pumps by also mandating the use of premium petrol (with a research octane number of 95) in the blend. Ethanol too has a high octane content; a superior blend is perhaps expected to smoothen the combustion process and allay consumer fears over ethanol damaging vehicle engines. But consumers should be allowed to make informed choices. Petrol pumps should offer a bouquet of options at various price points, while incentivising the shift to E20 or more. Consumers who wish to opt for less or no ethanol in their petrol should be given the option of paying more. Meanwhile, car and two-wheeler makers need to come out upfront with clear product specifications on how their engines are equipped to deal with ethanol’s supposedly corrosive properties. Ethanol’s lower calorific value reduces mileage, and to that extent raises petrol use.
Ethanol produces lower tailpipe greenhouse gas emissions, but the same cannot readily be said for the emissions over its entire product cycle. Besides, emissions from ethanol-blended petrol are not free of sulphur, nitrogen and other toxic chemicals. The environment-friendliness of ethanol depends a lot on the feedstock used. Recent research explains how ethanol is resource efficient perhaps only when no additional land, water or fertilizer is used. There is also the issue of diverting land from food crops. Fifty lakh tonnes of rice and 40 lakh tonnes of sugar would be used in India annually to support current levels of ethanol output. Therefore, agriculture waste, molasses, waste oils, fats and greases are a better feedstock option than using sugarcane, maize or rice. Maize is urea-intensive, even if it demands less water than rice or sugarcane. However, ethanol can be considered as a clean fuel option if product cycle issues are considered — including land and water scarcity, and food security.
It is also to be noted that electric vehicles are becoming viable by the day on account of falling battery costs and improved efficiency. To be sure, the product cycle emissions issues as well as import intensity of the process are germane issues here as well. The green transport transition should combine both ethanol blending and EVs judiciously — without lobbies driving the process. Domestic availability of ethanol feedstock is a crucial plus in times such as these.
Published on March 11, 2026