Ethanol blending: UP govt distilleries to supply 53 million litres to OMCs

State-controlled cooperative federation to invest Rs 160 crore on ethanol roadmap

To enhance the sugarcane value chain in Uttar Pradesh, government-controlled distilleries in the state have lined up investment of about Rs 160 crore to create fresh ethanol production capacity of 53 million litres (ML).

The ethanol would be supplied to the public sector oil marketing companies (OMC) under the ethanol blending programme for doping petroleum products. The scheme was mandated by the central government in order to gradually adopt greener fuels and to pare the massive oil import bill.

UP Cooperative Sugar Mills Federation Limited is investing to set up zero liquid discharge (ZLD) technology at its six existing distilleries. The civil work is nearing completion even as the 2019-20 cane crushing season is just 7-10 days away in the country’s top sugarcane and sugar producing state.

According to the Federation, the six units will collectively have an installed capacity to produce 35 million litres and 13.5 million litres of ethanol and rectified spirit respectively, apart from 25,000 tonnes of bio-compost by harnessing sugarcane byproducts such as bagasse.

Besides, two modern distilleries owned by the Federation at Azamgarh and Bijnore districts are equipped with ethanol and rectified spirit capacity of 18 million litres and 3 million litres respectively.

Thus, the eight distilleries operated by the Federation will have an overall capacity to produce 53 million litres and 16.5 million litres of ethanol and rectified spirit, respectively, in the forthcoming crushing season.

In the ethanol procurement pecking order, Indian Oil Corporation (IOC) is the top buyer with nearly 45 per cent share, followed by Hindustan Petroleum (HP) and Bharat Petroleum (BP).

Major states such as Maharashtra, UP, Uttarakhand, Punjab-Haryana and Karnataka have clocked more than 8.5 per cent ethanol blending, with Maharashtra and UP having achieved nine per cent or even higher ratio owing to high availability of sugarcane.

In 2018, the OMCs’ requirement of ethanol for blending with petrol stood at 3,136 million litres and for the 2019 season, the same is estimated at 3,300 million litres. The OMCs have already floated tenders earlier this year, for the procurement of 910 million litres of ethanol.

Meanwhile, the Federation has likely to earn Rs 250 crore a year from the sale of ethanol and rectified spirit, which would provide a cushion to its chain of 24 sugar mills settle farmers’ arrears promptly.

At the same time, the bio-compost would be supplied to local farmers for enriching soil without using chemical fertilisers and contributing towards higher rural income goal.

Earlier, chief minister Yogi Adityanath had also assured the Centre that the state would cooperate with the Centre to promote ethanol blending to save foreign exchange and cut oil import bill.

According to, UP private sugar millers such as Triveni, Dhampur, Balrampur and Dwarikesh Groups have planned capital investment worth Rs 1,500 crore to augment their combined ethanol production capacity to 1,200 klpd (kilo litres per day).