Petrol not blended with ethanol will get expensive from October, pushing private fuel retailers to sell blended fuel and help boost ethanol consumption.
“Blending of fuel is a priority of this Government. To encourage the efforts for blending of fuel, unblended fuel shall attract an additional differential excise duty of Rs 2/ litre from the 1st day of October 2022,” Finance Minister Nirmala Sitharaman said in her budget speech.
At present, petrol is blended with varying degrees of ethanol in different parts of the country. State-run companies such as Indian Oil, HPCL and BPCL sell ethanol-blended petrol while private players mostly sell unblended petrol. On average, about 8% of fuel sold by state-run firms are currently blended with ethanol. Parts of the country located far away from the ethanol production or storage facilities have a lower blending ratio.
“The government has sent out a strong signal that everyone should participate in the blending programme and the blended fuel should be uniformly available across the country,” said Abinash Verma, director-general, Indian Sugar Mills Association (ISMA).