Karnataka sugar mills ready for more ethanol supply

The sugar mills in Karnataka are prepared to supply additional quantity of ethanol to oil marketing companies as and when the petroleum and natural gas ministry increases the ethanol blending to 10 per cent from the existing 5 per cent.

"We are ready to supply additional quantity of ethanol to petroleum companies. We have built in sufficient capacities to meet the requirements," said M Srinivasan, president of South Indian Sugar Mills Association (SISMA) and managing director of Sri Chamundeshwari Sugars.

Karnataka is one of the states, where 5 per cent of ethanol is blended with petrol. The state's annual consumption of petrol is 80 crore litre and at 5 per cent blending, it needs up to 4 crore litre of ethanol. At present, the mills in the state are required to supply 3.6 crore litre of ethanol annually.

"With sufficient availability of molasses to meet various needs, the state is self-sufficient in ethanol production and supply to oil companies. Currently, the Karnataka government has put a restriction on the quantity of ethanol to be produced by these mills. If the restriction is withdrawn, we can produce as much as required by the oil marketing companies," said Srinivasan.

The 5 per cent ethanol blended petrol programme is likely to be implemented from December 1 this year after missing three deadlines (October 1, November 1 and November 15). The petroleum ministry is keen to advance the deadline for 10 per cent blending to June 2007 instead of October 2007, provided the sugar industry commits to supply the required ethanol.

At present, seven out of 42 sugar mills in the state are producing ethanol and all of them have enough capacity built in to increase the production, if required. The mills are capable of supplying up to 13 crore litre of ethanol annually. In addition to this, 10 more sugar factories are in various stages of construction in the state, where the combined investment is in the order of Rs 800 crore.

All the new factories are being built with facility to produce ethanol and cogeneration facilities, said Srinivasan, adding that the mills in the state are also ready to supply ethanol to states where there is a deficiency.

Srinivasan said the oil coordination committee, which fixes the price for ethanol, has decided an ex-distillery price of Rs 21.50 a litre in the north Indian states, such as Uttar Pradesh. The ex-distillery price of ethanol for Karnataka is being fixed later this month.

A meeting between the officials of sugar mills and oil marketing companies has been convened by the ministry of petroleum. "The price of ethanol for Karnataka mills is also likely to be in the order of Rs 21 a litre," he added.