The case for staying with ethanol 10

Ethanol blending over 10 per cent may be desirable but a full understanding of its environmental and economic impacts is crucial

India’s biofuel initiatives have been successful in getting us to a 10 per cent ethanol blend with petrol (E10). At this level, petrol engines sold in India since 2008 are not harmed, although older engines need modifications or no ethanol. Also, molasses as feedstock for ethanol from sugar factories have been adequate, supplemented by grain in good years, while the effluents are manageable, and there is less risk of “phase separation”, where a water-ethanol mix separates from the fuel. However, increasing ethanol to 20 per cent (E20) by the target date of 2025 is likely to be too disruptive. 

Food stocks

To begin with, food stocks needed to produce ethanol are lower than expected. In keeping with the planned Food Corporation of India (FCI) rice supply for ethanol, stocks were provided at Rs 2,000 per quintal to ethanol producers, but states could not buy FCI rice in June, even at Rs 3,400 per quintal.  This is unsustainable and contrary to FCI’s purpose of providing foodgrains at stable prices. Press reports indicate FCI stopped rice supplies for ethanol in the third week of July, although the official position was unclear.1 By then, ethanol production from rice had already reached the target for the year, although producers reportedly expect to manufacture 970 million litres more, from 2.2 million tonnes of FCI rice.

The initial plan was that surplus rice from FCI would enable an increase in ethanol production from 2023 to 2025.  Instead, erratic weather has led to uncertain crop yields. India, which accounts for 40 per cent of the international rice trade, has banned non-basmati rice exports, roiling global markets. Also, continuing disruption of grain supplies from Ukraine has resulted in shortages and rising global cereal prices. Suppliers from Thailand, Vietnam, and Indonesia are also holding back.

The planned increase in FCI rice provision for ethanol is shown in the table (from Table 7.3 in NITI Aayog’s plan, converted at 450 litres of ethanol yield per million tonnes of rice). This is unsustainable, and warrants urgent review of planned rice supply and blend levels to set realistic goals.

 Non-food cellulosic sources

If sustainable cellulosic ethanol production becomes a reality, avoiding the diversion of food crops, larger ethanol targets deserve consideration. Meanwhile, production at scale from non-food and non-sugarcane cellulosic feedstock has proved to be elusive for decades. It remains to be seen if commercial scale plants now operating in Italy and India, and being set up in America, can change that. 

As long as we are dependent on sugarcane and foodgrains for ethanol, there are compelling reasons to reduce targets. More land will need to be cultivated, requiring much more water, and extensive developments in logistics, like special materials for pipelines and tanks will be needed to deploy and use corrosive E20. The large stock of petrol vehicles will require engine modifications. To put it in perspective, the United States, which produces the most ethanol in the world (15,400 billion gallons) mostly uses E10, and has only about 3,300 E20 filling stations out of 145,000 countrywide (about 2 per cent).

Challenges

 * The government’s plan recognises feedstock availability as the first challenge for ethanol blended fuel. However, while the plan mentions the desirability of second generation feedstock from non-food sources such as cellulose, the period was shortened by five years, to 2025. 

* The second challenge mentioned was building extensive infrastructure to deal with logistics: Storage, transportation, and distribution of ethanol from the three states that produce it, Uttar Pradesh, Maharashtra, and Karnataka, to the rest of the country. 

 * The third challenge is modifying existing petrol engines to use E20. The estimated petrol vehicles stock in India is 212.7 million as of March 31, 2023, of which two-wheelers comprised 176.2 million, three-wheelers 21.8 million, and four-wheelers 14.7 million. The modifications mean significant costs, and would need many skilled technicians. It will probably take years, creating considerable disruption in the economy. 

 * Although not mentioned, higher ethanol production means more effluents that need mitigation.  Vinasse is an organic waste of which 12 to 20 units are produced for each unit of ethanol from sugarcane.  Grain produces half as much. Its treatment before disposal or use continues to be a complex struggle.

Pros & cons

The gains, according to some experts, are offset by the costs, such as low net benefits from reduction in greenhouse gases, the potential of damage to the environment, and costs to consumers.  Some scholars point out that greenhouse gases will be reduced only by 5 per cent by 2025 if targets are achieved, while emissions, such as aldehydes and ozone, will increase. Others suggest that land used for solar powered batteries would be much more efficient than growing crops for conversion to ethanol.2 A more technically sound assessment is needed.

While there is considerable momentum for corn-based ethanol in the US, and sugarcane-based ethanol in Brazil, these examples do not lend themselves to generalisation as universal solutions, because of the specific factors that enable their feasibility in their specific circumstances. 

There have been a number of compelling reasons put forward over the course of the last few years for targeting ethanol blending at 10 per cent and no more, and despite the attention, no OECD country uses E20 widely. The burden for less prosperous countries would be unimaginable, besides being impractical. 

The issue is whether on balance, the purpose of environmental and economic benefits is served.  From this perspective, ethanol blending over 10 per cent may be unjustifiable, because the environmental and economic impacts are mixed, including costs to consumers. Policymakers need to review the facts vis-à-vis assumptions and projections, to redefine objectives if required.  

shyamponappa@gmail.com

 1: https://shorturl.at/DGRY7

 2: https://shorturl.at/jIW56