ISMA urges PMO to fast-track ethanol blending beyond 20% amid energy crisis

The Indian Sugar and Bio-Energy Manufacturers Association (ISMA) has approached the Prime Minister’s Office (PMO) to fast-track a calibrated roadmap to push India’s ethanol blending programme beyond 20 per cent to 22 per cent or 25 per cent and 27 per cent in view of global energy market uncertainties.

 

Sources said ISMA, in a letter written a few days ago, stated that while global energy markets remain uncertain, accelerating domestic biofuel utilisation is both an economic and strategic imperative.

 

Given India’s strong domestic ethanol ecosystem, this is an opportune time to consider a fast-tracked and calibrated roadmap for ethanol blending beyond E20.

   

It noted that India continues to import nearly 85 per cent of its crude oil requirement, leaving the economy highly exposed to volatility in global oil markets.

 

“It is widely estimated that every $1 increase in crude oil prices raises India’s annual import bill by approximately $2 billion, directly impacting inflation, logistics costs and the fiscal balance,” ISMA said.

 

It added that recent geopolitical developments in the Middle East and disruptions in global shipping routes have underscored the vulnerability of global energy supply chains, with crude oil prices rising by nearly 30 per cent at one point and touching peak levels close to $120 per barrel.

 

Though markets have receded since then, most market analysts expect prices to continue fluctuating within a wide band of $75–105 per barrel in the sessions ahead.

 

“In such circumstances, maximising the use of domestic biofuels becomes an important strategic buffer to mitigate external energy shocks and strengthen national energy resilience,” the association said in the letter.

 

It said India now has ethanol distillation capacity of nearly 20 billion litres (sugar and grain-based), with the sugar sector alone accounting for around 9 billion litres.

 

“Against this, the current ethanol requirement for E20 blending is estimated at around 11 billion litres annually, implying that only about 55 per cent of the installed capacity would be utilised at E20 levels. This clearly indicates that ample domestic capacity already exists to support higher blending levels,” the letter added.

 

ISMA said accelerating domestic biofuel utilisation is both an economic and strategic imperative to ward off global energy challenges.