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GoM upholds ethanol blending price

BS Reporter  |  New Delhi 

In spite of the stiff opposition from the Ministry of Chemicals and Fertilizers, the group of ministers (GoM) on ethanol today maintained status quo on its earlier decision by upholding a price of Rs 27 a litre for a mandatory 5 per cent blending with petrol.

This is against a price of Rs 21.50 per litre which prevailed between 2006 and 2009.

“Blending has been made mandatory at Rs 27 per litre,” Renewable Energy Minister Farooq Abdullah said here after a meet of GoM. The future price would be decided by an expert committee, he said.

In an earlier meeting in April, the GoM had approved an interim price of Rs 27 for mandatory blending of petrol and ethanol. However, this ran into a hurdle from the Ministry of Chemicals and Fertilizers.

The two primary consumers of molasses-based alcohol are the potable liquor sector and chemical producers. In 2008-09, the potable sector consumed 1,000 million litres of alcohol, while only 300 million litres was left for others to use. The demand from the chemical sector is estimated at 1,000 million litres, while 5 per cent ethanol-petrol blending would require 680 million litres of alcohol.

First Published: Tue, July 27 2010. 01:10 IST