Context

The government has set targets of 10 per cent bioethanol blending of petrol by 2022 and to raise it to 20 per cent by 2030 under the ethanol blending programme to curb carbon emissions and reduce India’s dependence on imported crude oil.
1G and 2G bioethanol plants are set to play a key role in making bio-ethanol available for blending but face challenges in attracting investments from the private sector.

What are 1G and 2G biofuel plants?

1G bioethanol plants utilise sugarcane juice and molasses, byproducts in the production of sugar, as raw material, while 2G plants utilise surplus biomass and agricultural waste to produce bioethanol.
Currently, domestic production of bioethanol is not sufficient to meet the demand for bio-ethanol for blending with petrol at Indian Oil Marketing Companies (OMCs).
Sugar mills, which are the key domestic suppliers of bio-ethanol to OMCs, were only able to supply 1.9 billion litres of bio-ethanol to OMCs equating to 57.6 per cent of the total demand of 3.3 billion litres.

Experts point out that many sugar mills which are best placed to produce bioethanol do not have the financial stability to invest in biofuel plants and there and there are also concerns among investors on the uncertainty o the price of bio-ethanol in the future.
The prices of both sugarcane and bio-ethanol are set by the central government.
The three state-run OMCs Indian Oil Corporation Ltd., Bharat Petroleum Corporation Ltd. and Hindustan Petroleum Corporation Ltd. are currently in the process of setting up 2G bio-ethanol plants.
2G bioethanol not only provided a clean source of energy, but also helped to provide greater income to farmers and prevent them from having to burn agricultural waste which can be a major source of air pollution.

Back to Basics

Ethanol

Ethanol, can be produced from sugarcane, maize, wheat, etc which are having high starch content.
In India, ethanol is mainly produced from sugarcane molasses by fermentation process.
Ethanol can be mixed with gasoline to form different blends.
As the ethanol molecule contains oxygen, it allows the engine to more completely combust the fuel, resulting in fewer emissions and thereby reducing the occurrence of environmental pollution.
Since ethanol is produced from plants that harness the power of the sun, ethanol is also considered as renewable fuel.

Ethanol Blended Petrol (EBP)

It was launched in January, 2003.
It sought to promote the use of alternative and environment friendly fuels and to reduce import dependency for energy requirements.

OMCs are advised to continue according priority of ethanol from 1) sugarcane juice/sugar/sugar syrup, 2) B-heavy molasses 3) C-heavy molasses and 4) damaged food grains/other sources.
At present, this programme has been extended to whole of India except UTs of Andaman Nicobar and Lakshadweep islands with effect from 01st April, 2019 wherein OMCs sell petrol blended with ethanol up to 10%.