Government is planning a bigger than usual hike in the procurement of Ethanol. So far, ethanol prices have risen less than ₹1 per litre. The ethanol season begins on December 1. The main idea behind the price rise is to boost the domestic production of ethanol. Also, to encourage sugar mills to divert excess sugarcane to produce ethanol for blending with petrol, the government has allowed the production of ethanol from B-Heavy molasses, sugarcane juice, sugar syrup and sugar. The CCEA is likely to take up the ethanol price rise by October end. According to the media report, to encourage for the same, the Centre is all set to increase the procurement price of all three categories of ethanol produced from different sources by between Rs 2.50-3.0 per litre for the 2020-21 season. Cabinet Committee on Economic Affairs (CCEA) will take a decision on this soon.
Earlier, Centre had urged the mills for diversion of excess sugarcane and sugar for the production of fuel Ethanol as a long term solution for addressing the problem of excess sugar stock.