India targets E20 gasoline sales by 2023

The Indian government has directed oil companies to start selling gasoline with a 20pc ethanol blend (E20) nationwide from 1 April 2023, despite current blending rates of less than 10pc.

The notice, published in the country's national gazette yesterday, comes despite the oil ministry having continued to refer to an E20 target date of 2030 in official releases as recently as March.

Some in the industry take the notice to mean the Indian government is now targeting a 20pc blend rate by 2023, although there is no indication that sales of lower blends will be banned by that date or any official change to the E20 mandate.

The new rule follows a directive in February 2019 that required oil companies to begin retailing E10 across the country.

India has been ramping up efforts to boost ethanol blending, which it sees as crucial to reducing its dependence on oil imports as well as drawing down a big sugar surplus by diverting more of the commodity towards ethanol production.

The road transport and highways ministry amended vehicle rules in March to require manufacturers to indicate the ethanol compatibility of new vehicles, so drivers can transition safely to pumping higher blends. This follows a host of recent government measures to spur production of the biofuel, including loan aid for setting up distilleries and a hike in ex-mill prices.

India's blend rate for the December 2020 to November 2021 ethanol supply year was 7.56pc as of 24 May, the highest ever, with most sugar-producing states hitting 8-10pc, according to the Indian Sugar Mills Association. But meeting the nationwide 8-8.5pc target for the year will require the key ethanol states of Uttar Pradesh, Maharashtra and Karnataka to blend at least 12pc for the remainder of the season, it said.

Fuel ethanol imports to India are restricted and only officially permitted if there is a domestic shortfall.

By Lauren Moffitt