Biofuels: Government Initiatives

Considering benefits of biofuels in reducing import dependency on crude oil, as clean environment fuel and generating additional income to farmers and employment generation in rural areas, Government has undertaken number of initiatives such biofuels programme and increasing blending of biofuels etc.

 

Initiatives:

  • The biofuels programme is in synergy with Government’s other initiatives for Make in India, Swachh Bharat and doubling farmers’ income by 2022.
  • Government’s major interventions in this sector includes administrative price mechanism for ethanol, simplifying procurement procedures of OMCs, amending provisions of Industries (Development & Regulation) Act, 1951 and enabling lignocellulosic route for ethanol procurement.
  • Oil PSUs are also planning to set up 12 Second Generation (2G) Bio-refineries to augment ethanol supply and address environmental issues arising out of burning of agricultural biomass especially in North India.
  • Government also has approved National Policy on Biofuels-2018 in June 2018. It aims at reaching 20% ethanol-blending and 5% biodiesel-blending by year 2030.
  • It also has  expanded scope of feedstock for ethanol production and has provided for incentives for production of advanced biofuels.
  • Government also has increased price of C-heavy molasses-based ethanol to boost to Ethanol Blending Programme (EBP).
  • It also has fixed price of B-heavy molasses-based ethanol and sugarcane juice-based ethanol for the first time at Rs. 47.40.
  • It also has reduced GST on ethanol for blending in fuel from 18% to 5%.
  • Ministry of Petroleum & Natural Gas is making all efforts to increase ethanol supply for petrol and has taken several steps in this direction.

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