CCEA asks oil ministry to ensure 5% ethanol blending by OMCs

The government today asked the Petroleum Ministry to ensure that oil companies compulsorily sell petrol doped with 5 per cent ethanol. In November 2006, the government had mandated that ethanol should be blended in a 5 per cent ratio with petrol to be sold throughout India except in areas like North Eastern states and Jammu and Kashmir.

Subsequently, it stipulated that the amount of ethanol in petrol may be optionally ramped up to 10 per cent from October 2007 and made compulsory with effect from October 2008. But oil marketing companies (OMCs) -- Indian Oil, Bharat Petroleum and Hindustan Petroleum -- could not even implement the 5 per cent blend due to shortage of ethanol.

The Cabinet Committee on Economic Affairs (CCEA) today made it mandatory for OMCs to sell five per cent blended petrol. "The CCEA reiterated an earlier decision that there shall be a mandatory blending of five per cent of ethanol. It has instructed the Petroleum Ministry to ensure that all OMCs implement the decision," Home Minister P Chidambaram told reporters here after a meeting of the CCEA.

He said in order to ensure that there is no supply dislocation of ethanol, a small group of officials representing the ministries of Food and Consumer Affairs; Renewable Energy and Petroleum and Natural Gas will be constituted.