Lok Sabha Question No. 3898 (UNSTARRED), answered on 2015-12-22
Subject: Production of Ethanol
Ministry: CONSUMER AFFAIRS, FOOD AND PUBLIC DISTRIBUTION
Asked by: S. RAJENDRAN, M. UDHAYAKUMAR, LALLU SINGH, C. MAHENDRAN

## GOVERNMENT OF INDIA

## MINISTRY OF CONSUMER AFFAIRS, FOOD & PUBLIC DISTRIBUTION

## DEPARTMENT OF FOOD AND PUBLIC DISTRIBUTION

## LOK SABHA

UNSTARRED QUESTION NO. 3898

TO BE ANSWERED ON 22 ND    DECEMBER, 2015

## PRODUCTION OF ETHANOL

3898.

SHRI S. RAJENDRAN: ADV. M. UDHAYAKUMAR: SHRI LALLU SINGH: SHRI C. MAHENDRAN:

Will  the  Minister  of  CONSUMER  AFFAIRS,  FOOD  AND  PUBLIC DISTRIBUTION miHkksDrk ekeys] [kk| vkSj lkoZtfud forj.k ea=h be pleased to state:

- (a) whether  the  Government  is  promoting  blending  of  Ethanol  with petrol and its use as alternative fuel, if so, the details thereof indicating the  quantity,  demand,  production  cost  and  price  of  Ethanol  produced during the last three years and the current year along with the estimated demand during the ensuing year;
- (b) whether  there  is  any  proposal  to  expand  the  production  capacity and set up new plants and provide incentives for Ethanol production, if so, the  details  thereof  indicating  the  number  of  plants  presently  functional and number of plants proposed to be set up;
- (c) whether  the  Ethanol  produced  from  molasses  is  cheaper  than imported and refined motor fuels, if so, the details thereof and the steps taken to encourage its production/usage;
- (d) whether  the  Government  has  received  any  complaints  regarding pricing  of  Ethanol  and  blended  petrol,  if  so,  the  details  thereof  and  the corrective steps taken in this regard; and
- (e) the  details  of  the  benefits  obtained  by  Sugarcane  farmers  from ethanol production?

A N S W E R MINISTER OF CONSUMER AFFAIRS, FOOD & PUBLIC DISTRIBUTION (SHRI RAM  VILAS PASWAN)

- (a) Under Ethanol Blending Programme (EBP), the Central Government has scaled up blending targets from 5% to 10% to promote blending of ethanol with petrol and its use as alternative fuel. A statement indicating details of the  quantity,  demand,  production  cost  and  price  of  ethanol  produced during the last three years and the current year is annexed. Estimates of demand for the ensuing year 2016-17 are not available.

(b) Presently,  156  units  are  producing  molasses  based  ethanol  with annual installed capacity of approximately 224 crore litres. 21 distilleries with  sugar  factories  produce  only  alcohol  requiring  up  gradation  for ethanol  production  capacities.  12  more  ethanol  production  facilities  are being set up in different states.

Soft loans up to 40% of the project cost is provided to the sugar mills from Sugar Development Fund (SDF) for setting up ethanol projects.

(c) At present, ethanol produced from molasses is not cheaper than motor spirit at refinery gate. However, to achieve the objectives of the National Bio-Fuel Policy, with a view to encourage production/usage of ethanol, the Central Government apart from scaling up blending targets has also fixed remunerative  ex-depot  price  of  ethanol  and  waived  excise  duty  on  its supplies to OMCs during 2015-16.

(d)  Representations  regarding  pricing  of  ethanol  for  supplies  under  EBP have  been  received  from  industries  representing  chemical  sector.  The matter is presently sub-judice.

(e) Production of ethanol and its supplies under EBP at remunerative prices are likely to improve the liquidity position of sugar mills enabling them to clear cane price dues of farmers.

****

ANNEXURE ANNEXURE  REFERRED  IN  REPLY  TO  PART  (a)  OF  UNSTARRED

## QUESTION No.3898 FOR REPLY  ON 22.12.2015 IN THE LOK SABHA

Statement indicating details of the quantity, demand, production cost and price of Ethanol produced during the last three years and the current year

| Year    | *Quantity (of ethanol produced including alcohol from molasses ) in crore litres   |   Demand/Quantity required by Oil Marketing Companies under Ethanol Blending Programme (EBP) in crore litres |   Production cost of ethanol in Rs. per litre | Price of ethanol (in Rs. per litre) delivered at Depots of OMCs   |
|---------|------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------|-----------------------------------------------|-------------------------------------------------------------------|
| 2012-13 | 294                                                                                |                                                                                                       103.64 |                                          36.2 | Around 44.50                                                      |
| 2013-14 | 272                                                                                |                                                                                                       140.4  |                                          36.2 | Around 44.50                                                      |
| 2014-15 | 306                                                                                |                                                                                                       128.2  |                                          36.2 | 48.50 to 49.50                                                    |
| 2015-16 | 290 (provisional)                                                                  |                                                                                                       266    |                                          36.2 | 48.50to 49.50                                                     |

*As per industry sources

***