Electric Vehicle: India’s Target to Have 20% Ethanol Blended in Petrol by 2025 Could Affect Its Food Security

by Tanvi Deshpande (IndiaSpend.com/Scroll.in) Achieving the target won’t drastically reduce emissions nor will India achieve energy security because of it. -- For India to meet its target of 20% ethanol blended in petrol by the year 2025 (commonly known as the E20 target), it will have to bring in more land under cultivation of feedstock – agricultural products that can be converted into ethanol – land that can be better utilised for the generation of renewable energy and for furthering the electric vehicles adoption programme in the country, according to a new report by the Institute for Energy Economics and Financial Analysis.

Besides, the ethanol target will not reduce earth-warming emissions drastically, it may be detrimental to India’s food security, and will only help us inch towards energy security, experts say.

‘Misplaced priority’

Ethanol can be blended into petrol to reduce the quantity of petrol required to run a vehicle, thus reducing dependency on imported, costly and polluting petroleum. Today, India imports 85% of its oil requirements.

India’s net import of petroleum was 185 million tonnes in 2020-21 at a cost of $551 billion, according to a roadmap for ethanol blending released by Niti Aayog, the Centre’s policy think-tank, in June 2021. Most of the petroleum products are used in transportation and therefore, the E20 programme can save the country $4 billion (Rs 30,000 crore) annually.

Besides, ethanol is a less polluting fuel and offers equivalent efficiency at a lower cost than petrol. The availability of large arable land, rising production of foodgrains and sugarcane leading to surpluses, availability of technology to produce ethanol from plant-based sources, and the feasibility of making vehicles compliant to ethanol-blended petrol are some of the supporting arguments used in the roadmap for E20, which refers to the target as “not only a national imperative, but also an important strategic requirement”.

However, increasing the production of food-based feedstock for ethanol manufacturing may not be the best use of land in a hungry country, contends the Institute for Energy Economics and Financial Analysis. India ranked 101 of 116 countries on the World Hunger Index 2021. Further, land can be used far more efficiently for generating renewable power for electric vehicles (EV) than for growing crops for ethanol.

Independent experts also believe that existing ethanol production based on surpluses or damaged foodgrains can be maintained at status quo or at E10 (10% ethanol-blended petrol), but the E20 target may be a misplaced priority for India.

Ethanol can be used in vehicles calibrated to that particular degree of ethanol blending (for example, E20) or in flex fuel vehicles that can run on pure fossil fuel or fossil fuels blended with any degree of biofuels.

There is a long way to go for vehicles to be E20 compatible. Vehicles made in India since 2008 are material-compatible (rubber and plastic components) with E10 and fuel-efficient compliant with E5 (5% ethanol blended in petrol), but their engines are not tuned to E10 for optimum performance.

That said, the prices of ethanol produced in India are higher in comparison to global players, since the cost of raw materials – that is, sugarcane and food grains – are fixed by the government to support farmers.

But, at present, excise duty on the landed cost of petrol at oil depots is higher than the Goods and Services Tax on the landed cost of ethanol, and the benefit is being passed on to the retail consumers.

But Hetal Gandhi, director of CRISIL Research, a global ratings agency, believes that ethanol blended petrol can be a viable option for now, as electric vehicles will become a reality only after 2026-27.

Even the Niti Aayog roadmap asks that ethanol production reduce dependency on water-intensive, first generation biofuels like sugarcane, and instead develop advanced biofuels.

“The task force on sugar cane and sugar industry estimated that sugarcane and paddy combined are using 70% of the country’s irrigation water, depleting water availability for other crops,” as per the roadmap.

“Hence there is a need for a change in crop patterns, to reduce dependence on one particular crop and to move to more environmentally sustainable crops for ethanol production.

Cereals, particularly maize, and second generation biofuels with suitable technological innovations offer promise of a more environmentally benign alternative feedstock for production of ethanol.”

Second generation biofuels include rice or wheat straw, corn cobs, bagasse, bamboo and other non-food feedstock. At the moment, second generation biofuels technology is at a nascent stage, due to which the roadmap has called for technological innovations. READ MORE