India's fuel ethanol consumption is likely to increase by around 1 billion liters year on year to 4 billion liters in marketing year 2021-22 (December-November), Chairman and Managing Director of Bharat Petroleum Corp. Ltd. Arun Kumar Singh said at the India Energy Forum by CERAWeek on Oct. 21.
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For MY 2020-21, the use of fuel ethanol is pegged to be around 3 billion liters, Singh said.
According to S&P Global Platts Analytics, India's fuel ethanol consumption is expected to reach nearly 3 billion liters in 2022 and 3.2 billion liters in 2023. It had projected India's ethanol consumption at 2.7 billion liters in 2021.
India plans to achieve equal quantity of fuel ethanol production from sugarcane and food grains and has allowed grain-based distilleries to be set up across the country, Singh said.
As part of its drive to achieve a blending target of 20% by 2025, the government had in June this year allowed rice and maize to be used for producing ethanol.
However, it is unlikely that a high volume of ethanol can be derived from grains during the current MY 2021-22, industry participants said.
In MY 2020-21, India is expected to produce around 2.9 billion liters of ethanol from sugarcane and 42 million liters from grains, according to a report from the national thinktank National Institute for Transforming India, or NITI Aayog.
India, which imports around 85% of its fuel needs, has been looking at ways to raise ethanol blending particularly to reduce its reliance on imports and give its agricultural sector a boost.
A successful E-20 program can save the country $4 billion annually, according to a NITI Aayog report.
India is a net importer of ethanol and bought around 722 million liters of the fuel in 2020, mostly from the US, according to latest data from the commerce ministry.