Green Energy

Centre looks to increase ethanol price for 2024-25 season to raise production

The Central Government is considering increasing ethanol prices for the season beginning November 2024 while also promoting the diversification of feedstocks to meet the 20 percent blending target by 2025-26. As per reports, a committee led by a Joint Secretary from the petroleum ministry has already conducted one round of discussions on the proposal.

The revision of ethanol prices will be based on the fair and remunerative price of sugarcane, and reports indicate that this revision is being prioritized to incentivize production and meet the country’s blending goals.

Ethanol prices, set by the Central Government, have remained unchanged since the 2022-23 season (November-October). Currently, ethanol from cane juice is priced at Rs 65.61 per litre, while rates for ethanol from B-Heavy and C-Heavy molasses are Rs 60.73 and Rs 56.28 per litre, respectively.

The ethanol blending program is seen as a key component of the government’s green energy commitments and a way to improve the financial health of sugar mills. Official data shows that ethanol blending in India reached 13.3 percent by July of the current season, up from 12.6 percent in the 2022-23 season.

Recently, Cooperative Minister Amit Shah called for a multi-dimensional approach to biofuel manufacturing and affirmed that India would achieve its 20 percent ethanol blending target by 2025-26, ahead of the original 2030 deadline. He stated, “You need to be futuristic and look at opportunities and expand. …Ethanol can be made from multiple sources.”

Davangere Sugar Company Limited plans to produce ethanol primarily from maize and other damaged grains until the crushing season begins in October 2024. The government policy currently encourages ethanol production from maize, and the Central Government is now establishing a National Coordinating Agency to procure maize from farmers and supply it to sugar factories for ethanol production. This is expected to benefit both farmers & ethanol makers.

Subhash Yadav

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