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Rough ride for bio-fuel options

business Updated: Jun 15, 2008 22:37 IST
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India’s desire to overcome fuel shortage through alternative energy sources may not see a smooth ride.

In a draft report on bio-fuels, a Planning Commission Expert Group has said India does not have adequate quantities of ethanol for blending it with petrol even at 5 per cent levels.

In its draft report to a Group of Minsters (GoM) on biofuels the Plan panel’s expert group has said, “While availability of molasses is adequate, surplus ethanol available for blending with petrol is not there. This is primarily because the demand for ethanol to be converted into potable alcohol in the country is very huge.”

The government had planned to introduce mandatory 10 per cent ethanol blended petrol from October this year, but both the automobile and oil industry has also expressed reservations about the roadmap.

Presently, 5 per cent ethanol blending is mandatory across the country, except Jammu & Kashmir, northeastern states and island territories. India is the world’s second largest producer of sugar after Brazil. Ethanol, India is produced from molasses, a sugar by-product.

The GoM, headed by Agriculture Minister Sharad Pawar, is confabulating on a national biofuels policy and establishing a biofuels mission.

Citing reasons for short supply of ethanol, the Expert Group, which was constituted in 2006, pointed out that states restrict free movement of molasses leading to ethanol shortage to promote potable liquor production within the state.

The other reason for inadequate availability of ethanol is because of the fact that domestic molasses remains the cheapest option for the liquor industry as ethanol imported for potable purposes attracts very high customs duty making imports unviable.

Tata Motors managing director and president of Society of Indian Automobile Manufacturers (SIAM) Ravi Kant had shot of a letter last year to the government indicating that the higher blend would impact vehicles designed before 2002 and reduce fuel efficiency.

“We would like to bring to your notice that a 10 per cent ethanol blended petrol (E10), unlike 5 per cent blend would impact vehicle performance, if the percentage of ethanol varies significantly,” Kant said in a letter to the ministry of shipping, road transport and highways.