In an important policy announcement, the government has mandated the sale of E20 petrol with Research Octane Number (RON) 95 across the entire country.
For the sugar and bioenergy sector, which has been requesting a stable and long-term demand and supply policy, this announcement has landed as a blessing. It has rejuvenated the industry, as it finds a new purpose.
Amongst the initial takers of the decision, Samir Somaiya, Chairman & Managing Director of Godavari Biorefineries Limited, celebrated it as a “very positive development,” highlighting how India is ahead in its journey towards energy transition.
I feel his optimism is infectious.
Industry leaders, from sugar mills to grain-based distillers to advanced biofuel innovators, have been worried for months that expanded ethanol capacities would translate into less offtake. They worried that what if the market is unable to handle the supply?
That feeling has been decisively turned this week by the E20-RON95 mandate.
The E20 mandate, thus far in effect, frees up significant demand, reinforcing price certainty, increasing utilisation and making it easier for producers to plan investments in infrastructure with certainty.
What’s next? Is a question on everyone’s mind.
India boasts of the largest population. As per some estimates, the total energy consumption will almost double by 2045.
Road, aviation, and agriculture will make up a vast part of that consumption. Meeting this growing demand in a sustainable manner in India requires an extensive ethanol roadmap beyond E20.
Countries such as Brazil have long adopted E27 throughout their entire nation.
India needs a 2.0 National Ethanol Blending Policy. Clear timelines for E22, E27 and E30 adoptions. Producers contract on a long-term procurement basis and a technology roadmap for high-blend vehicles, for which Brazil is ready for knowledge transfer and partnership.
Adoption of higher blends will further reduce dependence on crude oil imports and create a reliable new source of income for farmers.
However, the current GST regime and differential duty slabs restrict market growth. A unified lower GST across biofuels and incentives for blending infrastructure at fuel stations would speed up the uptake of their use.
Flex-fuel vehicles (FFVs) need to be mainstream. A national FFV roadmap, including GST cuts, consumer incentives, and fleet-level measures, will enable the full unlocking of E27–E30 in India.
The Next Frontier in Aviation: Sustainable Aviation Fuel (SAF).
The International Civil Aviation Organization (ICAO) has adopted a market-based measure Carbon Offsetting Reduction Scheme for International Aviation (CORSIA), to reduce carbon emissions from international aviation. India, being a Member State of the ICAO, is under an obligation to comply with the mandatory phase of CORSIA from 2027. Under the CORSIA scheme, airlines are required to offset their emissions above a set baseline of 2019. The CORSIA scheme is applicable for international flights only.
To facilitate the Indian aviation industry’s transition towards carbon-neutral growth, India has joined ICAO’s Assistance, Capacity-building and Training for Sustainable Aviation Fuels (ACT-SAF) programme, which aims to support the mitigation of CO2 emissions from international civil aviation in ICAO Member States. India is also an active member of various working groups of ICAO Committee on Aviation Environment Protection where experts from all member States participate and contribute to the development of environmental standards and guidance material for the international aviation sector.
The Government has approved indicative blending targets of 1% by 2027, 2% by 2028 and 5% by 2030 for SAF in Traditional Aviation Fuel, initially for international flights. Public sector Oil Marketing Companies are actively engaged in achieving the stated blending targets.
A feasible SAF ecosystem in India will require a mechanism for financial viability gap funding, scheduled blending targets on domestic carriers, logistics, etc.
SAF is India’s chance to take the lead globally, making use of its agricultural prowess, distillation capacity and low-carbon aspirations.
A study done by Deloitte and ISMA released a report on 11th September 2025, on Sustainable Aviation Fuel (SAF) titled ‘India’s SAF Roadmap’.
The report said that India’s robust sugar industry has the ability to produce 350 to 400 Cr litres of SAF via surplus ethanol from the 1G route alone by 2040. “The sector holds the potential to meet over ~50% of India’s total SAF demand by 2040. In the near term, the report projects that the sugar sector can easily support 125 to 150 Cr litres of SAF production in 2030 without any disruptions in the ongoing sugar supply or ongoing ethanol blending,” the report outlined.
Isobutanol, produced from the same feedstocks as molasses-based ethanol, has various applications. Its blending with diesel has the potential to produce cleaner, lower-carbon diesel fuels and helps broaden the green fuel portfolio. Isobutanol-sourced bitumen enhancers can ease carbon intensity and increase the durability of roads, providing an eco-friendly route for the high-performance highway construction of India.
With the right policy architecture, biofuels are not just going to power vehicles; they are going to drive India’s economic revolution, delivering cleaner mobility, increased farmer incomes, lower oil imports, and a strong low-carbon future.
The industry is energised, optimistic and poised. It is now time to turn this optimism into action.
