Cabinet approves modified scheme for grain-based ethanol distilleries

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Union Cabinet on Wednesday approved modified scheme to enhance ethanol distillation capacity in the country for producing 1st Generation (1G) ethanol from feed stocks such as cereals (rice, wheat, barley, corn & sorghum), sugarcane and sugar beet.

Minister Dharmendra Pradhan said on Twitter, “#Cabinet led by PM Shri @narendramodi ji approved the expansion of interest subvention scheme to include grain-based distilleries besides molasses-based distilleries for production of ethanol. This will encourage ethanol production from grains like, barley, maize, corn & rice.”

In another tweet, he said, “Total outlay under the interest subvention scheme is ₹8,460 crore. #Cabinet has approved ₹4,573 crore under the scheme today to boost ethanol distillation capacity to 1000 crore litres for achieving the target of 20% ethanol blending with petrol by 2030.”

To increase production of fuel grade ethanol, Govt. is also encouraging distilleries to produce ethanol from maize; & rice available with FCI. Government has fixed remunerative price of ethanol from maize & rice.

Government is also planning to prepone achievement of 20% blending target by year 2025 and onwards. However, the existing ethanol distillation capacity in the country is not sufficient to divert surplus stocks of sugar & to produce ethanol to supply to Oil Marketing Companies (OMCs) for blending with petrol as per the blending targets fixed by Government of India.

Further the blending targets cannot be achieved only by diverting sugarcane / sugar to ethanol; & 1st Generation (1G) ethanol is required to be produced from other feed stocks like grains, sugar beet etc for which the present distillation capacity is also not sufficient. Therefore, it is an imperative need to enhance ethanol distillation capacity in the country for producing 1st Generation (1G) ethanol from feed stocks such as cereals (rice, wheat, barley, corn & sorghum), sugarcane, sugar beet etc.

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