With sugar mills facing difficulties in supplying ethanol to oil marketing and advertising firms (OMCs) regardless of obtaining been allocated a record 325 crore litres for the 2020-21 season, market body ISMA has urged the Union meals ministry to enhance the blending percentage from the present 10% to 12-15%.
In a letter to the secretary, Food & Public Distribution, ISMA director basic Abinash Verma stated that given that OMCs and their depots are unable to lift the ethanol as per the demand projected in their tenders, and are rather asking the suppliers to relocate their supplies to far away depots, it would be far better if the government had been to enhance the blend percentage in states that have currently reached 9-10% typical blending.
“Since the government is looking at achieving 20% blending in 2025, it is necessary that we start achieving at least 12% to 15% in the next couple of years,” he stated. As per a study by the analysis institute of IOCL in Faridabad, elevated blending of up to 13% does not demand any adjustments in current cars, he stated.
He urged the ministry to advise the Bureau of Indian Standards (BIS) to quickly repair the requirements for 12% and 15% blending.
Verma stated that the Society of Indian Automobile Manufacturers is stated to have some reservations on the elevated blend levels. “But since BIS standards are already fixed and notified for 20% ethanol blends with petrol, how and why are automobile manufacturers objecting to fixation of BIS standards for 12% and 15%? ” he asked.
According to market insiders, OMCs are not totally ready to obtain the contracted ethanol. “The Central government has advanced the deadline for blending 20% ethanol in petrol from 2030 to 2025. According to that plan, sugar mills and distilleries set up manufacturing capacity to augment supplies. But unfortunately, the OMCs did not prepare for the demand side. They did not create adequate tankage, and hence are refusing to lift our ethanol supply. As a result, we are fast running out of storage capacity. Our tanks will soon start overflowing,” a sugar miller stated on the situation of anonymity.
Another miller stated, “OMCs will take time to enhance their tankage capacity. In the meantime, if the government asks OMCs to immediately increase the blending percentage to 13%, it would straightaway mean an increase of 30% demand in ethanol. It will take care of all our worries.”
He stated that although the all-India blending typical is 7.5%, in specific states it is pretty much 10%. “Eleven states have a blending average of 9.5-10%. If only these states start blending up to 13%, the demand for ethanol will go up and we won’t be asked to take our supplies to faraway states and there won’t be any extra transportation cost,” he added.
In April final year, Uttar Pradesh, the country’s prime ethanol producer, had urged the Centre to enhance the blending percentage to 15% from the present 10% in the state.