| At a meeting held between ministry officials and ethanol producers last week, there was a proposal to advance the deadline for taking the blending to 10 per cent to June 2007 instead of October 2007 "if the 5 per cent blending works well" and if the "industry commits to supply the required ethanol". |
| The officials are hopeful that the 5 per cent blending programme will be implemented across the country by December. |
| The programme has seen a bumpy ride so far with only Uttar Pradesh, Tamil Nadu and Goa having been able to implement it successfully. The ex-distillery price of ethanol has been finalised in these states at Rs 21.50 per litre. |
| The oil marketing companies are keen on fixing the ex-distillery price of ethanol at Rs 21.50 in a uniform manner across the country. |
| However, the price negotiations in other states have not materialised. High import fees and other levies imposed by certain states are impeding price finalisation. |
| The ministry is in touch with the finance departments of various state governments and is trying to get them to reduce their levies, said an industry official. |
| Ethanol deficient states like Delhi and Haryana have imposed higher levies on ethanol imports. Haryana, for instance, has an import fee of Rs 2 per litre and permit fee of Rs 3 per litre, in addition to a high sales tax rate of 20 per cent. |
| In 2004, the ministry of petroleum and natural gas had made the sale of ethanol blended petrol mandatory only where the delivery price of ethanol at the location was "comparable to the import parity price of petrol at that location". |
| So in states where the levies are high, the oil companies will not be able to sell ethanol blended petrol. |
| At 5 per cent blending, the country will require about 587 million litres of ethanol. |
| The sugar industry has an installed capacity to produce 1,300 million litres of ethanol annually. |
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