ethanolll janak

8/2/2019 ethanolll janak

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India and Brazil, two of the world's emerging market giants, sought to

forge a strategic relationship between their distant nations and

enhance their role as a strong voice of the developing world.

The two fast-growing economies have come closer in recent years

and built a strong relationship based on common positions on key

issues such as global trade talks and expansion of the U.N. Security

Council.

The two countries are also working on a common position to address

climate change ahead of the G8 summit in Germany this week --

which both are attending -- and pushed for India's use of bio-fuels, anarea in which Brazil is a world leader.

DISTANCES BLURRING

Trade between India and Brazil has surged and touched $2.4 billion in

2006. They have also increased investments in each other's fast-growing economies.

Indian firms have focused on investment and joint ventures in Brazil's

pharmaceutical, IT and energy sectors while Brazilian companies

have targeted India's infrastructure, food processing and energy

sectors.

The two countries aim to quadruple trade to $10 billion by 2010.

Indian businessmen said they were pushing New Delhi to facilitate

easier trade between the two countries and were optimistic about

progress.


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Separately, Brazilian energy giant Petrobras offered a 25-30 percent

stake to India's state-run Oil and Natural Gas Corp. in three

exploration blocks.

In return, ONGC offered a 15-40 percent stake in its three deep-water

blocks on India's east coast, and a preliminary agreement on the

deals was expected to be signed shortly.

The two countries also signed seven agreements, including on

cooperation in space, customs and education.

What is ethanol?

Ethanol is a colorless, flammable liquid which is produced from the fermentation of sugar.

Ethanol is an organic solvent, similar in properties to the hundreds of other components of petroleum-

derived gasoline. Yet, there is a big difference: ethanol burns cleaner itself, and also it burns more

completely the petrol it is blended into.

Ethanol can be made from natural resources, organic liquids or coal beside grains, cassava etc. but the sources that

are most common, cheaper and also renewable are natural raw materials such as sugarcane juice or molasses.

This is because the raw material will be remade in exactly the same way during the following crop cycle. This is a

result of the action of photosynthesis upon the carbon dioxide.

.


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Three quarters of the worlds sugar is made from sugar cane in tropical zones located in the southern hemisphere.

Leading sugar cane producers are Brazil, India, China, Thailand, Pakistan and Mexico.

The remainder is processed from sugar beets grown in temperate zones of the northern hemisphere. France,

Germany, U.S., Russia Ukraine and Turkey produce the most from sugar beets.

Not all sugar-producing countries sell their processed sugar on international trade markets. Currently, 70% the

worlds sugar is consumed in the country where harvested. Only 30% is traded outside country of origin.

Top Ten Sugar Producers

Below are the leading sugar producers for 2005-6. These producers accounted for nearly 80% of the global sugar

total of 150 million tons in 2005-6. (The international sugar season runs from September to August.)

Brazil 30 million tons (20% of global sugar production)

European Union 22 million (14.7%)

India 20 million (13.3%)

China 10 million (6.6%) United States 7 million (4.6%)

Mexico 6 million (4%)

South African Development Community (SADC) 5.7 million (3.8%)

Australia 5.4 million (3.6%)

Thailand 5 million (3.3%)

Russia 2.7 million (1.8%)

Top producers that also export the highest percentage of their sugar production are Australia (76%), Brazil (59%),

Thailand (52%) and the European Union (37%). In contrast, India and Mexico each export just over 5% while China,

U.S. and Russia do not sell processed sugar to foreign markets.

Top Ten Sugar Exporters

Below are the leading sugar exporters for 2005-6.

Brazil 17.7 million tons (39% of global sugar exports)

European Union 8.1 million (18%)

Australia 4.1 million (9%)

Thailand 2.6 million (5.8%)

SADC 1.6 million (3.6%)

Guatemala 1.5 million (3.3%)

India 1.4 million (3.1)

Persian Gulf 1.3 million (2.9%)

South Africa 1.3 million (2.9%) Cuba 1.2 million (2.7%)


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Russia is the top consumer of Brazil's raw sugar cane. India buys the most Brazilianrefined sugar, followed by Canada and the U.S.

Brazilian exports of both raw and refined sugar were up significantly in 2010.

The total value of raw sugar cane shipped from Brazil to the rest of the world soared 55.7% to US$9.3 billion.

Overall exports of refined pure sucrose rose by a smaller but still impressive 44% to $3.5 billion.

Brazils Raw Sugar Cane Exports

The following top trade partners consumed 44.3% of Brazils total rawsugar cane exports in 2010.

1. Russia US$1.6 billion (16.9% of total Brazilian sugar cane exports)

2. India $875.5 million (9.4% of total)

3. China $505.5 million (5.4% of total)

4. Malaysia $370 million (4% of total)5. Canada $319.2 million (3.4% of total)

6. United States $176.1 million (1.9% of total)

7. United Kingdom $170.1 million (1.8% of total)

8. South Korea $58.7 million (0.7% of total)

9. Japan $52.9 million (0.6% of total)

10. Netherlands $11.5 million (0.1% of total).

Three emerging BRIC economies (Russia, India and China) accounted for 31.7% of Brazils overall raw sugar cane

shipments in 2010.

Brazils Refined Sugar Exports

Compared to sugar cane, the following trade partners consumed a much smaller amount of Brazilian refined sugar

(pure sucrose), both in terms of dollar amounts and percentages.

1. India US$110.6 million (3.2% of total Brazilian refined sugar exports)

2. Canada $49.1 million (1.4% of total)

3. United States $28 million (0.8% of total)

4. Mexico $18.6 million (0.6% of total)

5. Russia $15.7 million (0.5% of total)

6. Argentina $13.6 million (0.4% of total)

7. China $9.3 million (0.3% of total)

8. Malaysia $8.2 million (0.2% of total)

9. Netherlands $6.4 million (0.17% of total)10. Germany $5.5 million (0.16% of total).

Although India is the leading importer of Brazilian refined sugar, two so-called developed nations Canada and the

United States are near the top of list of refined sugar customers. This may have to do with lower labor costs for

refining sugar in Brazil.


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FOREIGN TRADEBrazil invites Indian cos to invest in sugarcane farming.

Brazil, the world's largest ethanol producer, has thrown open its doors to investment by Indian companies

in sugarcane farming, extracting ethanol and exporting it back home for mixing in petrol.

While India dopes petrol with five per cent ethanol to cut its oil import dependence, Brazil is made up of

one-fourth ethanol.

State-run fuel retailers are already talking to various companies in Brazil for cane farming and ethanol

production at an investment of close to 600 million dollars.

Indian Oil, Hindustan Petroleum and Bharat Petroleum will form a joint venture to take up ethanol

production in Brazil. They together will have a 50 per cent stake in the joint venture, while a local Brazilian

firm will have the remaining.

The initial ethanol production capacity being targeted is 500 million litres.

Growth of sugar Industry in India

Gujarat is one of the well known sugar cane producing regions in India. This has been one of the reasons for thegrowth of sugar industry in the state. After independence, the government gave importance to the growth ofsugarcane farming in the state and established a number of sugar cane mills. After the market liberalization policiestook place in the 1990s, the export of the sugar industry increased to a great extent.

Due to the growth of technology, newer methods have been implemented which has increased the production of

sugar. Today, the sugar mills in Gujarat are equipped with an array of hi-tech facilities and services which make thema known name in the field of agro based industries.

Today, there are around 554 sugar mills and factories in the state of Gujarat. It must be noted in this respect thatalmost all of the Gujarat Sugar Industry is under a state cooperative system where the government partly controls theproduction and the business. However, there are also a number of sugar mills which are privately owned. Out of the554 sugar mills, most of them are covered under the co operative system. According to the recent surveys, the totalamount of production of sugar in the state is around 190 lakh metric tons.

Sugar mills in Gujarat

The sugar mills form a bulk of the Gujarat sugar industry. Around 17 sugar factories in the state are equipped withadvanced technological equipments which have a capacity to crush around 65,000 tons of sugar daily. Around 1.9lakh hector of the total cultivable land is meant for sugarcane cultivation.

Today, the sugar mills in the state covers and employs more than 4.50 lakh farmers and cultivators. The overallturnover of the co-operative sugar mills in Gujarat crossed around Rs 2000 crores for the financial year 2008 to 2009.Apart from offering various types of employment opportunities in the organized sector, the unorganized sector alsooffers scope for employment for lots of people. It is estimated that the total number of people directly and indirectlyassociated with the Gujarat sugar industry is around 3.15 lakh.


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List of sugar factories in Gujarat

Some of the well known sugar factories and sugar co-operatives in the state are:

Sugar factories Details

Net Sales 450

C/o. Sardar Coop. Sugar Industries Ltd At Kadachhala, Teh.Jetpur

Pavi, Dist. Vadodara, Sector

Specializes in the production of

various sugar types.

Kaveri Vibhag S. Khand Udyog Mandli Ltd. Nisha Complex, Flat No.

103, P.P. Water Tank, Khergam Road, Chikhli, Dist. Navasari 396 521,

It has the crushing capacity of

around 2500 MT of sugarcane

on a daily basis.

Sahdev B. Chaudhari, Shri. Kantha Vibhag Sahakari Khand

Udyog Mandli Ltd C/o. Jilla Panchayat Office, Dariya Mahel, Surat

395003, Location-Saras, Olpad, Dist. Surat, L.I. No. 197

The crushing capacity is around

2500 metric tons daily.

Shee Valsad Sahakari Khand Udyog Mandali Ltd. Parbera Pardi,

Valsad, Gujarat

The crushing capacity ranges

from 2500 to 3000 tons.

Shree Damanganga Sahakari Khand Udyog Mandli LtdDaman

Road, Opp. S.T. Depo, Near Jalaram Khaman House, Vapi-396 191,

Ph.-(02668) 30333


2500 metric tons of sugarcane.

Shree Nizar Vibhag Sahkari Khand Udyog Mandli Ltd Nizar, Dist.

Surat


2500 tons.

Shri Surat Jilla Uttar Purva Vibhag Sahkari Karkhana Udyog

Mandli Ltd C/o. Jilla Panchayat Office, Dariya Mahel, Ph.2953 Mandvi

Surat-395 003

The mill has a crushing capacity

of around 2500 MT of

sugarcane.

Shri Ukai Asargrast Vibhag Sahakari Khand Udyog Mandli Ltd C/o

Jilla Panchayat Office, Dariya Mahel, Surat-395 003, Location at

Gunsada Teh. Songadh, Distt. Surat


2500 tons.

Thakorbhai J. Garasia Vanvasi Sahakari Khand Udyog Mandli

Ltd Khambla Vansada, Dist. Valsad, L.I. No. 254

Crushing capacity is around

2500 MT.

Vadodara Dist. Cooperative Sugarcane Growers Union

Ltd.Trimurti Apartment, R.C. Dutt Road, Vadodara- 390007


2500 MT.


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Why India MUST push for ethanol blended petrol


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Petroleum is one of the most precious natural energy resources. With India growing at a fast pace, the demand foroil is set to rise. India and China will account for 45 per cent of the increase in global primary energy demand by

2030.

India has become a significant consumer of energy resources. Its oil consumption has risen to 3.3 million barrels per

day in 2009, from 643,000 barrels of oil per day in 1980, making it the world's fourth biggest consumer of oil.

India is also the fourth largest producer of ethanol in the world. Ethanol production in India has an advantage as its

production could potentially leave sugar prices unaffected. By blending petrol with 10 per cent biofuel, 80 million litres

of petrol could be saved annually in India, says a report by the Institute of Defence Studies and Analyses.


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In India, ethanol made its foray into the transport sector as a fuel additive in 2001. The government launched threeEBP pilot projects, the first in Uttar Pradesh, followed by two others in Maharashtra.

In order to enhance the country's energy security, the Government of India mandated blending of 5 per cent ethanol

with petrol in 9 States and 4 Union Territories in the year 2003 and subsequently mandated 5 per cent blending of

ethanol with petrol in 20 States and 8 Union Territories in November 2006 on an all -India basis except a few North

East states and Jammu & Kashmir.

The programme was a significant step in utilising alternative, renewable and environment-friendly sources of energy

like ethanol to supplement fossil fuels.

The sugar industry agreed to all the terms of the oil marketing companies (OMCs), which include agreeing to a fixed

price for three years and has also demonstrated adequate availability of ethanol to increase the blending proportion

to 10 per cent.

Despite the group of ministers (GoM) headed by the finance minister endorsing a price of Rs 27 per litre in April 2010,

the programme continues to hang fire.

Why Ethanol Blended Petrol

The EBP programme is primarily based on indigenously produced ethanol from sugarcane molasses, which,besides augmenting fuel availability in the country, would also provide better returns for sugarcane farmers.


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Further, ethanol is environment-friendly as it enhances combustion of petrol, resulting in lower emission of pollutants.

With reduced dependence on crude oil consumers can pay less for petrol and enjoy the benefits of a clean and

healthy environment.

..())))In India, ethanol is mainly derived by sugarcane molasses, which is a by-product in the conversion ofsugarcane to sugar. Therefore, ethanol does not compromise on the food security front.

The government's EBP programme would lead to better returns for sugar cane farmers and therefore better

sugarcane and sugar production.

In India, ethanol production does not take away land from food crops. Ethanol production = Higher cane price = Rural

prosperity.

Ethanol and your car

Engine performance and total emissions are both improved by the addition of ethanol to petrol.

Another performance benefit from ethanol is its high octane addition to fuel. Of all the commercially viable octane

boosters possible, nothing delivers more punch than ethanol. The populace still feels the ill effects of the tonnes of


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poisonous lead that are spewed into urban environments because of the poor decision to accept lead over ethanol as

the octane additive of choice.

Other benefits due to ethanol in cars are technical in nature, but may be summarised as follows:

1. Cleans engine over time, especially harmful combustion chamber deposits;

2. Improved front end volatility for better cold start and improved operation (driveability and distillation curve effects);

3. Dissolves any fuel line and fuel tank water, which are sources of corrosion, and eliminates them out through the

exhaust;

4. The higher octane of the ethanol blend allows the new cars with higher compression ratio to run smoothly without

any change in engines.

Blending ethanol up to 10 per cent has technical benefits without impacting on engine performance and fuel efficiency

in cars.

Exhaust versus evaporative emissions

Adding ethanol to regular unleaded petrol at 10 per cent is an easy way to make unleaded premium, and it extendssupplies by 10per cent.

Without any modification of the base petrol, however, the vapour pressure of the fuel will increase slightly, leading to

more evaporative, or fugitive, emissions. These are primarily vapours that escape the carbon canister on the

automobile, or are forced into the air as the level in a fuel tank rises. They do not include fuel spills, because normally

the entire volume of a gasoline spill will evaporate in any case.

The question is whether this greater evaporative mass gives rise to greater pollution potential than the large benefit of

exhaust emissions reduction.


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In the view of some fuel scientists the nature of the chemical make-up of this new vapour space is less harmful that

the unblended, but lower pressure, base gasoline has. Ethanol itself, for example, which is now part of the vapour,

has a lower ozone-forming potential than olefins and aromatics.

Adding ethanol to regular unleaded extends supplies to the extent of blending and lowers risks of ozone formation.

Ethanol and health

After years of ethanol use in once-polluted major cities in the United States, Europe and Brazil, the air is

demonstrably cleaner and within federal guidelines for a healthy lifestyle.

Not only are toxic species reduced, such as carbon monoxide and aromatics, but also the potential to produce ground

level ozone is lower because the elements necessary for its production have been greatly lessened.

In particular, high octane benzene, known to cause leukaemia, can be nearly eliminated because ethanol can provide

the octane it once did.

The benefit to citizens of urban airsheds is enormous. Cleaner air means healthier people, especially those that suffer

from respiratory diseases. Mortality rates will improve, health care visits will decrease in number and severity, health

care costs and insurance rates will benefit, and productivity will improve as absenteeism and performance is

improved.

EBP = Clean air = Healthy people


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Ethanol energy balance compared to petrol

Ethanol yields more energy net to the planet than it takes to produce it. Petrol, or any fuel derived from fossilsources, cannot possibly do so.

You are always at a deficit because you must consume some of the energy contained in the fuel to transport and

process it, and you never get anything back. The carbon dioxide from combustion adds to the atmospheric inventory

of other greenhouse gases.

With ethanol, the carbon dioxide produced either during fermentation or combustion will be remade into exactly the

same amount of plant matter from which it was made. This photosynthetic cycle is what is meant by the renewable

nature of ethanol, which in fact is classified as a solar fuel.

Doing a complete energy balance, to include inputs at all levels of processing and giving credits where due, still

makes for a positive balance using modern methods of farming and ethanol manufacture. This is an important part of

what is meant by ethanol being sustainable.

The EBP programme will contribute to India's food security and energy security objectives.


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Limit of ethanol in petrol

Strong evidence exists that ethanol blends up to 10per cent are, in the words of the US Environmental ProtectionAgency, 'substantially similar to gasoline'. Every manufacturer of petrol-burning engines, for any transport application

in the US, warrants the use of E10 as acceptable, and some go so far as to recommend it.

While there is no compelling evidence that blends up to 20 per cent might cause harm to the current and future fleet

of automobiles, neither is there any evidence that harm will not be done, other than good fortune in the experiences

so far.

Until such time as credible evidence proves otherwise, and the production of ethanol in India is so great that we can

afford to provide some blends higher in percentage than E10, prudence requires that a limit of 10 per cent be applied.

10 per cent blend of ethanol will cause no harm to the current and future fleet of automobiles.

What is needed?

The Cabinet Committee on Economic Affairs mandated 5 per cent blending of ethanol with petrol in November2009. Thereafter, an empowered committee of the government headed by the Union minister of agriculture,

consumer affairs, food & public distribution and also comprising the Union minister for petroleum and natural gas, and

the Union minister of new and renewable energy sources recommended the fixation of ethanol price at Rs 27 per litre

for 3 years in December 2009.

This price was further endorsed by the group of ministers headed by the finance minister in April 2006.


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The above recommendations were made after ensuring that even in years of shortage, the production of molasses

based alcohol would be enough to meet the 5 per cent EBP programme even after meeting the requirement for

potable purposes.

Regarding the ethanol price, purchase of ethanol at Rs 27 per litre by OMCs is not only a commercial proposition, but

it also leaves substantial profit of about Rs 8 per litre of ethanol purchased by OMCs.

This price is also on par, if not slightly lower than the prevailing import prices (at an average price of about $655 per

tonne during April to July 2010, the import price works out to a landed price of about Rs 33 per litre inclusive of

customs duty and others).

The stage, therefore, is set and what is needed is a quick kick-start to the EBP programme of the government. It is

about time that in the interest of the nation's food security and energy security objectives the programme is given its

much needed boost.

Report Highlights:

The Government of India (GOI) approved the National Policy onBiofuels on December 24, 2009. The policy proposes a target of 20percent blending of bio-diesel and bio-ethanol by 2017. Indias biofuelstrategy continues to focus on the use of non-food resources; namelysugar molasses for production of ethanol and non-edible oils for theproduction of biodiesel. The governments current target of 5 percentblending of ethanol in petrol has been successful in years of surplussugar production, but unfilled when sugar production declines.

Biodiesel production in India is very small due toinadequate supplies of feedstock.

The biofuel policy encourages use of renewable energy resources asalternate fuels to supplement transport fuels (gasoline and diesel for

vehicles) and proposes a target of 20 percent biofuel blending (bio-diesel and bio-ethanol) by 2017.

Presently, the government is unable to implementcompulsory blending of 5 percent ethanol in petrol (gasoline) due tothe short supply of sugar molasses in 2009/10 and 2008/09 becauseof overall low sugarcane crop production in India.

Consequently, India imported about 280 million liters of ethanol in2009 to meet the demand for industrial and potable liquor production.


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With a bumper sugarcane and sugar production outlook for 2010/11,the government is likely to renew its focus and implement themandatory 5 percent ethanol blending in petrol. Industry sourcesreport that the government is likely to take a decision on the purchase

price of ethanol for the Ethanol Blending Program (EBP).Commercial production of biodiesel in India is very small and itsutilization is mostly confined to the unorganized sector.

The governments ambitious plan of producing sufficient bio-diesel by2011/12 to meet its mandate of 20 percent diesel blending isunrealized due to a lack of sufficient jatropha seeds to produce bio-diesel.

Advanced biofuels in India are still at the research stage and it will

take time before commercial production becomes economically viable.

Biomass is frequently used in sugar mills, textiles, paper mills, andsmall and medium enterprises (SME) for both heat and powergeneration.

India is the fifth largest primary energy consumer and fourth largestpetroleum consumer in the world. Growing population and rapid socio-

economic development has spurred an increase in energyconsumption across all major sectors of the Indian economy. Givenlimited domestic energy resources, most energy requirements are metthrough imports.Provisional estimates indicate that India meets more than 76 percent

of its petroleum demand through imports.

Per an estimate from the GOIs Petroleum Conservation ResearchAssociation, the average consumption of petroleum

productsin India is as follows:

1.Transport (Petrol, Diesel, CNG, Aviation Fuel) : 51 percent

2. Industry (Petrol, Diesel, Fuel Oil, Naphtha, Natural Gas): 14 percent

3. Commercial buildings and Others: 13 percent

4. Domestic (LPG and Kerosene): 18 percent


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5. Agriculture (Diesel): 4 percent

Energy demand across the transport sector is likely to be higher givendouble digit growth in the Indian economy, rise in domestic spendinglevels, and improving road infrastructures have all led to an increase

in new vehicle registrations and ownership. Indias on-road vehiclepopulation has increased from 49 million to more than 65 millionvehicles over the last five years and is expected to grow annually by 8to 10 percent. Diesel and gasoline-based oils meet more than 95

percent of the requirement for transportation fuel, and demand hasbeen expected to grow by 6 to 8 percent per year during the 11th FiveYear Plan (2007-12).

The current growth in transport activity and the consequent increase in

petroleum consumption is posing serious concerns for theenvironment. Given that India is the worlds fourth largest contributorto carbon emissions, the GOI transport policy is targeting EURO-IIIand IV norms for vehicles, which in turn would require adoption ofclean and green fuel. The government is seriously concerned abouteconomic, environmental and energy security, and is looking for useof alternate fuels to meet energy demand in a technically efficient,economically viable and environmentally sustainable manner.

Presently the GOI is promoting and encouraging production and useof i) ethanol derived from sugar molasses/juice for

blending with gasoline and ii) biodiesel derived from non-edible oilsand oil waste for blending with diesel.

POLICY AND PROGRAM: INDIAS BIOFUEL POLICY

SNAPSHOT OF INDIAS NATIONAL POLICY ON BIOFUELS:

Setting up a National Biofuel Coordination Committee under the PrimeMinister for a broader policy perspective and set up a National BiofuelSteering Committee (NBSC) to provide policy guidelines.

Strengthen Indias energy security by encouraging use of renewableenergy resources to supplement transport fuels. A 20 percent target


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for blending of biofuel for both bio-diesel and bio-ethanol by 2017 isproposed.

Meet the energy needs of a vast rural population as well as stimulaterural development and create employment opportunities.

Address global concerns about the containment of carbon emissionsthrough the use of environmentally friendly biofuels.

Derive bio-fuels from non-feed stock that would be raised on degradedland or wastelands that are not suited to agriculture, thus avoiding apossible conflict of fuel verses food security.

Facilitate and bring about optimal development and utilization ofindigenous biomass feedstock for the production of biofuels. The

policy also envisages development of next-generation, more efficientbiofuel conversion technologies based on new feed stocks.

Minimum Support Price (MSP) mechanism to ensure a fair price forbio-diesel oilseed growers. The implementation of the proposal wouldbe considered carefully after consultation with stake holders, centraland state governments and then by the Biofuel Steering Committeeand finally decided by National Biofuel Coordination Committee.

Oil Marketing Companies propose to purchase bio-ethanol at a

Minimum Purchase Price (MPP) based on the actual cost ofproduction and the import price of bio-ethanol. In the case of biodiesel,the MPP should be linked to the prevailing retail diesel price.

Biofuel technologies and projects will be allowed 100 percent foreignequity through automatic approval routes to attract Foreign DirectInvestment (FDI), provided biofuel is for domestic use only, and not forexport.

ETHANOL POLICY.

Ethanol is produced in India from sugar molasses for blending withpetrol. Beginning January, 2003, the GOI mandated the use of 5percent ethanol blend in petrol through its ambitious Ethanol BlendingProgram (EBP).


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Developments in EBP:

January,

2003

Ministry of Petroleum and Natural Gas

(MoPNG) made 5 percent ethanol blending in petrol (gasoline)mandatory across 9 States and 5 Union Territories, Partiallyimplemented due to unavailability of ethanol (due to low sugarcaneproduction in 2003/04 and 2004/05)

September,

2006

Resurgence in sugarcane production in 2005/06 and 2006/07 led GOImandate 5 percent blending of ethanol in gasoline across 20 statesand 8 Union Territories subject to commercial viability OMCcontracted for 1.4 billion liters of ethanol for EBP at Rs 21.50/litersfrom Nov 2006 to Nov 2009. Only 540 million liters of ethanol suppliedtill April 2009 due to short supply of sugar molasses. GOI deferredimplementation due to short supply of sugarcane in 2007/08.

September,

2008

Union Cabinet approved the National Biofuel Policy. Five percentblending mandatory across all states in the country.

Blending ratio to be raised to 10 percent. Targets 20 percent blendingby 2017.GOI deferred the plan again due to short supply of sugarcaneand sugar molasses in 2008/09.

Since Indian sugarcane production is cyclical, ethanol and alcoholproduction in India depends on the availability of sugar molasses (abyproduct of domestic sugar production). Lower sugar molassesavailability and consequent higher molasses prices have impactedethanols cost of production, thereby causing a disruption in the supplyof ethanol at pre-negotiated fixed ethanol prices.


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Presently, the government is unable to implement compulsoryblending of 5 percent ethanol in petrol(gasoline) due to theshort supply of sugar molasses in 2009/10 and 2008/09 on lowsugarcane crop production.

With a bumper sugarcane and sugar production outlook for 2010/11,the government is likely to renew its focus and implementthe mandatory 5 percent ethanol blending in petrol. Industry sourcesreport that the GOI is likely to take a decision on

providing a hike in purchase price of ethanol for the Ethanol BlendingProgram (EBP) for upcoming 2010/11 season.

Augmenting ethanol supply:

Currently, the government does not allow use of imported ethanol forthe EBP program, as the focus is on developing domestic productioncapacities. To augment supply, the GOI has permitted ethanolproduction directly from sugarcane juice while ensuring that the movedoes not constrain production of sugar or ethanol for industrial use.

Efforts to produce ethanol from sweet sorghum, sugar beets, and

sweet potatoes, however, are at the experimental stage.The government does not provide any direct financial assistance ortax incentive for the production or marketing of ethanol or ethanolblended petrol.

The GOI is offering subsidized loans (through sugarcane developmentfunds) to sugar mills for building ethanol production units. The loanswould cover a maximum of 40 percent of the project cost to sugarmills for development of ethanol production unit.

Impediments:

Higher taxes and levies in different states have impacted the EthanolBlending Program. Rules and regulations (high excise duty, inter statecharges etc.) applicable to the control of alcohol for potable industryuse are equally applicable for ethanol blending with petrol, therebyconstraining its availability and utilization for the EBP.


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ETHANOL AS A FUEL

In the first phase of the project, ethanolblended petrol is being supplied through retail outlets in nineStates and four Union Territories. These states are Andhra Pradesh, Goa, Gujarat, Haryana, Karnataka,

Maharashtra, Punjab, Tamil Nadu and Uttar Pradesh. The four Union Territories include Chandigarh,

Dadra and Nagar Haveli, Daman and Diu and Pondicherry. Petrol blended with 5 per cent ethanol would

be supplied by petrol pumps all over the country under the second phase towards the end of the year.

The content of ethanol blending would be increased to 10 per cent in the third phase of the programme

scheduled for 2005.

Ethanol is used as an automotive fuel by itself and can be mixed with gasoline to form what has been

called "gasohol" Fuel Ethanol- the most common blends contain 10% ethanol and 85% ethanol mixed

with gasoline. Over 1 billion gallons of ethanol are blended with gasoline every year in the United States.Because the ethanol molecule contains oxygen, it allows the engine to more completely combust the

fuel, resulting in fewer emissions. Since ethanol is produced from plants that harness the power of the

sun, ethanol is also considered a renewable fuel. Therefore, ethanol has many advantages as an

automotive fuel.

Most industrial ethanol is denatured to prevent its use as a beverage. Denatured ethanol contains small

amounts, 1 or 2 percent each, of several different unpleasant or poisonous substances. The removal of

all these substances would involve a series of treatments more expensive than the federal excise tax on

alcoholic beverages (currently about $20 per gallon). These denaturants render ethanol unfit for someindustrial uses. In such industries un denatured ethanol is used under close federal supervision.

INDIA should start working on the roadmap of 10% blending followed by 20%

India should start working on the roadmap of 10% blending followed by 20%. The recent tenders (2010-

11) of ethanol blending by oil corporations is in full swing. India has already blended (oil corporations

have purchased) ethanol to the tune of 30 Crore liters till date (April 2011) out of the 71 crore liters

required till 31st October 2011.

All the sugar companies having ethanol facility are on the verge of expansions. Since the blending has

taken off smoothly. Now is the time for the government and Decision Makers to work a roadmap for

blending 10%. We understand the conflict created by the chemical and fertilizer industries which

resulted the government to create a panel of experts under the leadership of Saumitra Chaudhuri,

Member of Indias Planning commission, to look into the aspect in detail and the panel came out with a

true visionary picture which would set a roadmap to the future ethanol blending for India.


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Apart from some solid recommendations the panel also suggested a price of Rs. 26.76 per liter for the

year 2010-11 which is sensible. But the question still remains as the raw material of ethanol is molasses

and how many of us know we are exporting molasses till date. The quantum is around 3 lacs tons which

can produce 8 crore liters of ethanol. Indirectly we are not distilling it and I worry how much more

molasses we would export. Here there should be a serious micro-level working and the oil corporations

should be a party to it.

The price of crude has made the oil companies to think positive on ethanol. if they would have done it

earlier we would have build a solid platform till now. The Ethanol blending program needs more

collective working by all the sugar associations, ethanol manufacturing associations, and the oil

corporations along with the government. We should be answerable to young India tomorrow. Yes!

We have set the platform to be a crude free India (my dream). Now they need to work on it and build.

We took 28 years to win the Cricket Would Cup but if I say after 28 years we would be out of oil. Imagine

how much efforts we would have to put in. Hence we all should stand behind the roadmap to blend as

much as alternative fuel we can. Your comments & suggestions are welcome.

www.ethanolindia.net

DEMAND SUPPLY FOR ETHANOL

The Centers Gasohol Program of blending 5% ethanol in petrol has given an assured scope for ethanol

industry in the country. The Centers Kisan-friendly imitative has definitely been a boost to the

venture. Following statistics could show how there is definite market potential for such industry.

PETROL CONSUMPTION
http://www.ethanolindia.net/http://www.ethanolindia.net/http://www.ethanolindia.net/


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10000000 KILO Liters

500000 KILO Liters - 5% ALCOHOL required

500000000 Ltrs.

Demand all over Country 5000 Lac liters

Existing Production 1840 Lac liters

Total demand 2460 Lac liters

Demand in Maharashtra 700 Lac liters

Source: The information is taken from document published by Govt. of India Ministry of Petroleum

andNatural Gas.

In parts of 4 states of Andhra Pradesh, Maharashtra, Punjab, Uttar Pradesh & Goa 5% of ethanol

blended petrol has already been started and till 30th June 2003, it will be fully covered. Gujarat, Haryna,

Karnataka, Tamilnadu and the Union Territories of Chandigarh, Dadra & Nagar Haveli Daman and Divand Pondicherry are also covered till end of July 2003.

The entire country will be covered in 2nd Phase and ethanol content to be increased to 10% in

3rd Phase.

Most important R & D Studies are successful of blending ethanol with Diesel, which itself is a very

significant point in developing ethanol.


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All this significance shows a definite assured market for the industry leading the project to most viable

and safe for financial assistance.

ANHYDROUS ETHANOL POTENTIAL FOR GASOLINE BLENDING

The statistics published by the Ministry of Petroleum the potential is as follows:

For 5% Blend in Gasoline

Requirement on all India Basis 500 million ltrs. per annum

Requirement in 8 States 300 million ltrs. per annum

Requirement in UP & Maharashtra 40 & 70 million ltrs. per annum respectively

This statistics show a direct potential.

Source: The information is taken from document published by Govt. of India Ministry of Petroleum and

Natural Gas.

Due to govt. promoting ethanol to mix in petrol there is drastic demand for ethanol, which could

overcome the existing unutilized capacity and thus creating an excess demand.

Cautious bidding efforts by ethanol (Sugar) manufacturers will definitely bring

rewards to the Indian sugar industry.

Dilemma in future prices of alcohol in the coming year results in under bidding the quantity of ethanolfor fuel blending in India.Out of the total 1016616 KL, the sugar, ethanol manufacturers bided nearly

62% of the total quantity for ethanol to be blended in fuel in India. This clearly indicates a smart move

by the sugar factories since they are unwilling to keep all eggs in one basket. This move will create a win-

win situation for everybody, including the chemical and fertilizer industry who need industrial alcohol

and were not in favor of the fuel blended ethanol. What the sugar- ethanol factories have achieved is to


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gain maximum out of the by-product. Last year we exported molasses around six lac tons and this

balance move by sugar companies will also keep the molasses export option open.

Looking at last years approximate alcohol consumption figures-

100 Crore liters was for potable alcohol.

70 Crore liters was for industrial alcohol.71 Crore liters for ethanol, fuel blending which still in supply process and 65 to 70% will be achieved.

This demand for alcohol is good for ethanol plant manufacturers, since we believe production of ethanol

is a value addition to the sugar industry and hence more profitable than producing sugar and even co-

generation considering the capital cost of the project.

On the other hand there is a good scope to produce alcohol from sweet sorghum, tropical beet and

biomass. Technology companies would play a vital role here. A joint effort by Oil Marketing Companies,

Ethanol Manufacturing Associations, the Ministry of Oil and Petroleum and all the associations of sugar

factories should join hands to set a roadmap to achieve the E20 till 2017 objective set by the

government. Even investors should see a promising ROI in the alcohol projects.

The state governments role specifically in Rajasthan, Punjab, Haryana, Uttarakhand, Bihar, Jharkhand,

Odisha, West Bengal, Gujarat, Madhya Pradesh, Goa, Kerala and Tamil Nadu have to look into the micro-

level of the product as they have to believe that only potable alcohol should not be the target. In fact

saving also is earning and to make better tomorrow and to keep the environment clean and make fresh

air to breath in these respective states by burning a more clean fuel will have an indirect benefit to the

people. So Jago state governments. The states like Maharashtra, Karnataka, Andhra Pradesh and Uttar

Pradesh have taken this seriously but would need more efforts.

To conclude the scenario to produce ethanol has kept wide doors open for the upcoming industries.

IMPORTANT LINKS:http://www.emerging-

markets.com/ethanol2020/Ethanol2020_GlobalSurvey_Contents.pdf
http://www.emerging-markets.com/ethanol2020/Ethanol2020_GlobalSurvey_Contents.pdfhttp://www.emerging-markets.com/ethanol2020/Ethanol2020_GlobalSurvey_Contents.pdfhttp://www.emerging-markets.com/ethanol2020/Ethanol2020_GlobalSurvey_Contents.pdfhttp://www.emerging-markets.com/ethanol2020/Ethanol2020_GlobalSurvey_Contents.pdfhttp://www.emerging-markets.com/ethanol2020/Ethanol2020_GlobalSurvey_Contents.pdfhttp://www.emerging-markets.com/ethanol2020/Ethanol2020_GlobalSurvey_Contents.pdf


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USES

Ethanol is often called drinking alcohol or pure alcohol as it is the prime ingredient in alcoholic beverages.

Ethanol is the intoxicating substance in alcohol.

Ethanol can be used as a fuel for motor vehicles. Ethanol make a good fuel for cars because it reduces the

emission of harmful gases such as carbon monoxide. Brazil are one of the leaders in the production of cars that

run on ethanol. Over 20% of cars in Brazil are able to run on 100% ethanol fuel.

Lightweight rocket-powered racing aircraft often use ethanol as rocket fuel.

Ethanol is used in antiseptic and some antibacterial soaps and wipes. Ethanol is effective against viruses, fungi

and most bacteria but is ineffective against bacterial spores.

Ethanol is occasionally used to treat poisoning by other alcohols that are more deadly (methanol is one particular

example).

As ethanol is soluble in water, it can be used in a variety of different products. These include paint, permanent

markers, perfumes and deodorants. Ethanol may also be used as a solvent in cooking, such as vodka sauce.

Ethanol is considered a feedstock into the chemical industry as it is used to make other important chemicals.

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