Ethanol-Blended Fuel in India: A Case Study

• Ethanol blending is a response to the 1970s oil shock and is pushed as carbon neutral.

• India’s case for ethanol blending is import substitution and lower prices.

• Government argues that ethanol blending up to 20% can ensure $10 billion annually.

• Benefits for farmers, traders, and distillers will be uneven.

• Increased use of C-heavy molasses, broken rice, and maize productivity to address food security concerns.

• Import substitution figures can be impacted by import of farm inputs.

• Ethanol has an efficiency penalty, affecting material durability and fuel handling systems.

• India’s vehicles are committed to handle up to E20, but questions arise over impact on older vehicles.

• Consumers have no choice, and price reduction claims are not reflected in the bunk.