Oil marketing companies fail on ethanol lifting commitments, blending programme targets likely to fall short

While the central government has launched a range of policy initiatives to promote its ambitious ethanol blending programme (EBP) target of achieving 10% blending in petrol by 2022 and 20% blending by 2025, huge miscalculations by oil marketing companies (OMCs) are threatening to jeopardise the programme.

According to sugar industry sources, due to the encouragement and incentives provided by the government, the sugar mills and distilleries have achieved a record allocation of 310 crore litres of ethanol to be supplied to OMCs for the 2020-21 ESY, which runs from November to October, as against the previous record of 190 crore litres in 2018-19.

However, owing to slip-ups in creating adequate tankage, the OMCs have started reallocating contracted quantities from several depots, which the distilleries had competed to obtain, to faraway depots in other states, which take several days to reach, resulting in huge financial losses to the distilleries.