Green Gold: India’s Journey Towards Bioethanol Production
- sujeetkofficial
- May 1, 2025
- 2 min read
Executive Summary
India’s rapid economic growth and rising energy needs, coupled with environmental and geopolitical pressures, have intensified the search for sustainable fuel alternatives. Bioethanol, a renewable fuel produced through the fermentation of plant-based sugars and starches, has emerged as a strategic solution to reduce crude oil dependency, mitigate carbon emissions, and boost rural economies.
Global and National Context: Globally, bioethanol has been utilized for over a century, with Brazil and the United States pioneering large-scale production. In India, bioethanol’s relevance has grown due to energy insecurity, climate change, and rising import bills. As of 2025, India’s ethanol production capacity stands at 13.8 billion liters, with a blending rate of 15%, up from just 1.53% in 2014.
The report outlines the four generations of bioethanol: 1st Generation (food crops like sugarcane and corn), 2nd Generation (non-edible biomass like rice straw, bagasse), 3rd Generation (algal biomass), 4th Generation (genetically modified organisms for optimized production).
Bioethanol Production in India: India’s journey began in 1938, with a structured policy emerging via the Power Alcohol Act (1948) and Ethanol Blended Petrol (EBP) Programme (2003). A landmark shift occurred with the National Policy on Biofuels (2018) and the announcement of the E20 blending target by 2025. Policy reforms allowed the use of B-heavy molasses, sugarcane juice, surplus food grains, and damaged crops.
Production Trends & Achievements:The ethanol blending has increased from 1.53% in 2013-14 to 15% in 2024. Over ₹1.45 lakh crore disbursed to distillers and farmers. Reduction of 544 lakh metric tons of CO₂ emissions. Major ethanol-producing states: Uttar Pradesh, Maharashtra, Tamil Nadu, Karnataka, Gujarat.
Challenges: Climate change impacts on rice and sugarcane yields. Competing demands for grains from food, industrial, and export sectors. Sustainability concerns due to high water usage in sugarcane and rice production. Technical and economic limitations of advanced (3G and 4G) bioethanol technologies.
India’s bioethanol strategy is central to its energy transition. With the right mix of policy incentives, technological innovation, and international cooperation, India is well-positioned to not only meet but exceed its ethanol blending targets while fostering rural development and environmental sustainability.
Author - Shravani M Phatak
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Disclaimer:: The views, opinions and the data expressed in this report are those of the authors alone and do not necessarily reflect the official policy or position of any affiliated organization or institution.
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