Bold Biofuel Ambitions: This Is an Important Year for India

(Biofuels International) This is an important year for India with the country holding the G20 presidency through to the end of November, giving the nation’s leaders several opportunities to help shape future policies and programmes across many sectors, including their already-declared strong focus on biofuels.

Adopting a presidency theme of Vasudhaiva Kutumbakam – One Earth One Family One Future, India has named the development of a Global Biofuel Alliance (GBA) as one of its priorities for its time as G20 leader, committing to work with the United States and Brazil to advance GBA along with ‘other interested countries’.

India’s internal ambitions regarding biofuels are equally strong, many aspects of which are detailed in the newly published 328-page final report of the country’s MoP&NGbacked Energy Transition Advisory Committee (ETAC).
Highlighting the fact that India is committed to reaching net-zero by 2070, committee chair, Tarun Kapoor, said that, as the third largest aggregate emitter in the world, this pledge can have a significant impact on the global fight against climate change.

The section does not gloss over the challenges attached to the country’s biofuels’ ambitions. Stating that biofuel demand across the Asia/Pacific region in general is expected to grow by 12% in 2023, on top of a 9% advance in 2022, the report applauds ‘supportive government policies in India’ and ‘higher biodiesel blending requirements in Indonesia’ for their part in promoting the ongoing growth.

It also draws attention to India’s determination to keep raising its ethanol blending mandate, advancing from a blending requirement of 5% in 2019/20 to 12% this year. This is just a stepping-stone to 2024/25 and 2025/26, however, when the intention is to achieve and maintain an ambitious 20% mandate.

With a clear realisation that this will require a major growth in production or imports, the emphasis within India is very much on boosting domestic resources with some estimates suggesting the country will need to be producing 14.5 billion litres of ethanol by 2025/26 to avoid demand outstripping supplies.
US role in ethanol supplies

For an external view on how such ethanol projections may be likely to work out in practice over the next few years, Biofuels International asked the US Grains Council’s (USGC) director of global ethanol export development, Mackenzie Boubin, for an assessment of India’s current and projected usage.

“As of May 14, 2023, India was averaging an 11.6% nationwide ethanol blend,” said Boubin, pointing out that this is below the blending target fixed at the start of this year.

“In addition, although demand was set at 5.99 billion litres for an 11-month period, current contacts are for 5.12 billion litres and final supply could be about the same.”

Concerning the balance between India’s desire to create its own ethanol supplies, versus imported product, he added that India primarily utilises sugarcane juice and B Heavy and C Heavy molasses for ethanol production domestically, with an increasing interest being shown in maize and spent grain ethanol production, albeit impacted by water scarcity issues as they relate to sugarcane or rice-based feedstock.

On the imports question, Boubin commented: “India is a top ten market for US ethanol year-over-year. The country was the fourth-largest market for US ethanol in the 2021/22 marketing year, representing a total of nearly 130 million gallons, with the US capturing well over 90% of export market sales into India.”

The USGC also said it expected industrial ethanol to continue to represent a short-term opportunity for US ethanol producers, aligned with the removal of India’s 5% customs duty on imported denatured ethanol.

The advance of secondgeneration bioethanol production in India is also in focus as a developmental objective. Currently, India has four operational advanced biofuel plants, according to the ETAC report.

This includes both a pilot and a demonstration plant with a cumulative annual production capacity of 1.75 million litres of cellulosic ethanol. Actual production, however, is stated to be a ‘mere fraction’ of this figure. In addition, there are several advanced biofuel plants in development, but, here again, the report comment is that these projects are ‘far from reaching commercialisation as of now’. Biodiesel and biogas production opportunities are also being considered.

While India produces only a ‘minuscule’ portion of global biodiesel volumes at 0.163 million tonnes a year, the country’s target is to achieve 5% biodiesel blending in diesel by 2030.

Financing India’s biofuels’ ambitions will be key to the ultimate achievement of the country’s plans, another ‘fact of life’ highlighted within the ETAC report where the need to ‘expedite’ the establishment of a National Biofuel Fund is expressed, as indicated in the country’s National Policy on Biofuels.

The stated vision for such a fund is to provide ‘relevant financial incentives’ by way of subsidies and grants for new and 2G feedstocks, alongside support for associated technologies. READ MORE