The Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, approved the revision of ethanol procurement prices for public sector Oil Marketing Companies (OMCs) for the Ethanol Supply Year (ESY) 2024-25. The period extends from November 1, 2024, to October 31, 2025, under the Government of India’s Ethanol Blended Petrol (EBP) Programme.
The ex-mill price of ethanol derived from C Heavy Molasses (CHM) has been increased from ₹56.58 to ₹57.97 per litre, marking a 3% rise. The revision aims to ensure adequate ethanol supply to achieve higher blending targets, stabilize ethanol prices, and provide a remunerative rate for ethanol producers. Additionally, Goods and Services Tax (GST) and transportation charges will remain payable separately to support sugarcane farmers.
The EBP Programme, which promotes blending ethanol with petrol to reduce crude oil imports and combat environmental pollution, has shown remarkable progress. Ethanol blending by public sector OMCs surged from 38 crore litres in ESY 2013-14 to 707 crore litres in ESY 2023-24, achieving an average blending rate of 14.60%.
Over the past decade, this initiative has led to an estimated foreign exchange saving of over ₹1,13,007 crore and crude oil substitution of approximately 193 lakh metric tonnes. The government has advanced its target of achieving 20% ethanol blending from 2030 to ESY 2025-26, with plans to reach 18% blending during ESY 2024-25.
To support this transition, several measures have been implemented, including the enhancement of ethanol distillation capacity to 1,713 crore litres per annum and the establishment of Dedicated Ethanol Plants (DEPs) in deficit states. Other steps include promoting multi-feed distilleries, facilitating the availability of E-100 and E-20 fuels, and launching flex-fuel vehicles.
The government emphasized that these initiatives align with the broader objectives of Atmanirbhar Bharat and ease of doing business, driving investments in greenfield and brownfield distilleries, logistics facilities, and employment opportunities across the country. The EBP Programme is expected to yield substantial environmental benefits, forex savings, and prompt payments to cane farmers.
