UP govt upscaling ethanol supplies with projects worth Rs 6,700 crore

Uttar Pradesh (UP), the nation’s leading ethanol producer with over 1.50 billion litres generated in 2023-24, has logged fresh private investment worth ₹6,772 crore in the sector.

 

"Private investors are setting up facilities worth ₹6,772 crore for creating an additional ethanol capacity of 1.06 billion litres in UP," a senior official said. According to the government data, UP produced more than 1.50 billion litres of ethanol in 2023–24 from 102 active distilleries.

 

Ethanol is mixed with petroleum products as a greener alternative to fossil fuels. The Centre aims to achieve a blending ratio of more than 20 per cent by 2025. UP Chief Minister Yogi Adityanath has also asked officials to accelerate efforts to increase ethanol blending. Ethanol can be produced from both sugarcane and food grains.

 

Keeping pace with the clean energy demand, boosting ethanol is key to energy security and enhancing rural incomes.

 

Sugarcane is also called the ‘green gold of the future’ owing to its role in ethanol production. 

 

About 5 million rural households in UP grow sugarcane, with the annual sugarcane payments by 122 sugar mills accounting for over ₹34,000 crore. UP's sugarcane economy is estimated to be more than ₹50,000 crore across its value chain of sugar, jaggery, ethanol, chemicals, etc.

 

The Yogi-led government has also implemented a 5-year strategy to transform the state's sugarcane sector. It includes modernising mills, setting up distilleries, producing sulphur-free sugar, increasing cane yield, expanding cultivation area, and improving the sugar recovery rate.

 

In this regard, the UP Sugar Mills Association (Upsma) and Greentech Consultants recently hosted an international conference on 'Business Models for Mitigating Challenges Before the Sugar Industry' in Lucknow. Delegates from India, Thailand, Nepal, Vietnam, and Sri Lanka brainstormed on issues the global sugar sector is facing, Upsma Secretary General Deepak Guptara said. 

 

In 2024–25, nearly 84 per cent of the cane dues of ₹34,466 crore in UP has been paid so far by mills. Sugarcane acreage increased from roughly 2.05 million hectares in 2016-17 to 2.95 million hectares in 2024-25, while the productivity rose from 72.38 tonnes to 84.10 tonnes per hectare during the corresponding period.

 

At present, 122 sugar mills, 236 khandsari units, 8,707 traditional kolhus, 65 co-generation plants, and 44 distilleries operate across 45 districts of UP.