Ethanol blending: 2026-27 tender shuts out sugar-based feedstocks
The ethanol tender for supply year 2026-27, issued on 16 October 2026 by Bharat Petroleum Corporation Limited for the oil marketing companies, seeks no ethanol from sugarcane juice, sugar, sugar syrup or B-heavy molasses, citing directions for zero sugar diversion. It invites about 1,100 crore litres and reportedly cuts the maize-ethanol price to Rs 68.86 a litre from Rs 71.86.
Syllabus: GS3 · Agriculture & Irrigation; GS3 · MSP, Subsidies & Food Security; GS3 · Infrastructure
Why this matters for UPSC
GS3 energy and agriculture: Prelims can ask what the National Policy on Biofuels, 2018 and its 2022 amendments provide and when the ethanol supply year runs; Mains, about food security versus energy security.
Why it matters
A sugar mill that sent part of its cane juice to its distillery now has no buyer for that ethanol this year, so more cane will be crushed into sugar. That should keep sugar on shop shelves and its price in check in a year of weak rains. The cost falls elsewhere: distilleries that run on cane juice must switch to grain or sit idle, and maize-based distillers will earn less on every litre, which may cut what they pay farmers for maize. Motorists see little change, since blending continues on grain-based ethanol. The larger question is how far a food crop should be turned into fuel when harvests are uncertain.
Prelims pointers
- National Policy on Biofuels, 2018: notified by the Ministry of Petroleum and Natural Gas on 4 June 2018, replacing the 2009 policy of the Ministry of New and Renewable Energy.
- NPB 2018 categories: basic biofuels are 1G bioethanol and biodiesel; advanced ones include 2G ethanol, MSW to drop-in fuels, 3G biofuels and bio-CNG.
- NPB 2018 lets surplus food grains go to ethanol only with the approval of the National Biofuel Coordination Committee (NBCC).
- 2022 amendments to NPB 2018: 20% blending target advanced to ESY 2025-26 from 2030; more feedstocks; SEZ and EOU production; biofuel export in specific cases.
- Ethanol supply year: 1 November to 31 October since 1 November 2023; it earlier ran from 1 December to 30 November.
- A feedstock-based differential price for ethanol was announced for the first time in 2018; the Government has notified an administered ethanol price since 2014.
- Ethanol's research octane number is about 108.5 against about 84.4 for petrol, per PIB, but its calorific value is lower.
Practise a UPSC-style question
With reference to the National Policy on Biofuels, 2018, consider the following statements:
1. It was notified by the Ministry of Petroleum and Natural Gas, replacing a 2009 policy issued through the Ministry of New and Renewable Energy.
2. It allows surplus food grains to be used for ethanol with the approval of NITI Aayog.
Which of the statements given above is/are correct?
- (a) 1 only
- (b) 2 only
- (c) Both 1 and 2
- (d) Neither 1 nor 2
Show the answer
Answer: (a) 1 only
Answer: (a) 1 only. The policy came from the petroleum ministry, but surplus grains need the nod of the National Biofuel Coordination Committee.
Statement 1: correct. The Ministry of Petroleum and Natural Gas notified the policy on 4 June 2018, superseding the 2009 policy promulgated through the Ministry of New and Renewable Energy.
Statement 2: incorrect. The 2018 policy lets surplus food grains go to ethanol with the approval of the National Biofuel Coordination Committee (NBCC), not NITI Aayog.
Eliminate: Statement 2 names the wrong approving body, so it is incorrect. Out: (b), (c).
Eliminate: Statement 1 matches the PIB record of the policy's notification, so it is correct. Out: (d).
Trap: Swapped attribution. NITI Aayog wrote the 2021 ethanol roadmap, so it sounds like the body that clears grain use; the policy gives that power to the NBCC.
Remember: NPB 2018: notified by MoPNG; surplus grains to ethanol only with NBCC approval.
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