Biofuels and ethanol blending  | UPSC

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UPSC Syllabus: Mains – GS Paper III- Indian economy, environment, and ecology

Context: The Indian Sugar Mills’ Association (ISMA) has said that to achieve the target of 8-8.5% ethanol blending, it is important to increase the blending level to at least 12% in surplus States and adjoining ones. The current supply is about 7.56% annually. The current demand is about 346.52 crore litres. In this context we will read about the purpose and importance of ethanol blending.

What is ethanol?

  • Ethanol (also called ethyl alcohol, grain alcohol, drinking alcohol, or simply alcohol) is an organic chemical compound. It is a volatile, flammable, colourless liquid with a slight characteristic odour. It is a psychoactive substance, recreational drug, and the active ingredient in alcoholic drinks.
  • Ethanol is naturally produced by the fermentation of sugars by yeasts or via petrochemical processes such as ethylene hydration. It has medical applications as an antiseptic and disinfectant. It is used as a chemical solvent and in the synthesis of organic compounds. It is a fuel source.

What is ethanol blending?

  • It means blending of ethanol with other relevant fuels to make them more energy efficient. Ethanol can be mixed with gasoline to form different blends. As the ethanol molecule contains oxygen, it allows the engine to more completely combust the fuel, resulting in fewer emissions and thereby reducing the occurrence of environmental pollution. Since ethanol is produced from plants that harness the power of the sun, ethanol is also considered as renewable fuel.
  • Ethanol Blended Petrol (EBP) programme was launched in January, 2003. The programme sought to promote the use of alternative and environment friendly fuels and to reduce import dependency for energy requirements.

Purpose and Importance of blending

  1. To provide green and clean alternative fuel source.
  2. To reduce burden of high fuel imports.
  3. To reduce emission of greenhouse gases.
  4. To provide alternative market for crops.
  5. Promote organised sale of reduce crops.
  6. To benefits farmers with income security and high returns.
  7. To promote behavioural change in fuel consumption.
  8. To raise spending on research and development.
  9. Better utilisation of urban solid waste.
  10. Possible employment generation.


  • Categorization: The Policy categorises biofuels as “Basic Biofuels” viz. First Generation (1G) bioethanol & biodiesel and “Advanced Biofuels” – Second Generation (2G) ethanol, Municipal Solid Waste (MSW) to drop-in fuels, Third Generation (3G) biofuels, bio-CNG etc. to enable extension of appropriate financial and fiscal incentives under each category.
  • Scope of raw materials:The Policy expands the scope of raw material for ethanol production by allowing use of Sugarcane Juice, Sugar containing materials like Sugar Beet, Sweet Sorghum, Starch containing materials like Corn, Cassava, Damaged food grains like wheat, broken rice, Rotten Potatoes, unfit for human consumption for ethanol production.
  • Protection to farmers: Farmers are at a risk of not getting appropriate price for their produce during the surplus production phase. Taking this into account, the Policy allows use of surplus food grains for production of ethanol for blending with petrol with the approval of National Biofuel Coordination Committee.
  • Viability gap funding:With a thrust on Advanced Biofuels, the Policy indicates a viability gap funding scheme for 2G ethanol Bio refineries of Rs.5000 crore in 6 years in addition to additional tax incentives, higher purchase price as compared to 1G biofuels.
  • Boost to biodiesel production:The Policy encourages setting up of supply chain mechanisms for biodiesel production from non-edible oilseeds, Used Cooking Oil, short gestation crops.

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