The Indian Union government has introduced a significant change in its policy, allowing sugar mills to use cane juice, syrup, and molasses to produce ethanol for the Ethanol Supply Year (ESY) 2024-25, starting from November 1, 2024. This new rule removes the previous limit on how much sugar could be diverted for ethanol production.
Under this updated policy, sugar mills and distilleries can now use not only cane juice and syrup but also B-Heavy and C-Heavy molasses for making ethanol. This change aims to support the government’s goal of increasing the use of renewable energy sources and reducing dependence on fossil fuels. Ethanol, a cleaner alternative to petrol, helps lower pollution and can reduce the need for imported oil.
In addition, the government has also allowed distilleries to purchase up to 2.3 million metric tons of rice from the Food Corporation of India to use for ethanol production. This initiative is part of a broader strategy to enhance ethanol output and meet the goal of blending 20% ethanol with petrol by 2025.
The Ministry of Consumer Affairs, Food and Public Distribution announced that the policy change is expected to significantly increase ethanol production. This is a positive development for the sugar industry, which has been struggling with an oversupply of sugar in the domestic market. By diverting more sugar to ethanol production, mills can tap into a new market and improve their financial performance.
To address potential concerns about sugar shortages, the Department of Food and Public Distribution (DFPD) and the Ministry of Petroleum and Natural Gas (MoPNG) will collaborate to monitor and review the impact of the new policy. They will ensure that there is enough sugar available for domestic consumption while also supporting increased ethanol production.
The Ministry of Consumer Affairs, Food and Public Distribution has stated that DFPD will work with MoPNG to regularly review the balance between sugar available for domestic use and sugar diverted for ethanol. This monitoring will help maintain a steady supply of sugar for consumers.
Overall, this policy change is a major step towards promoting renewable energy and supporting the sugar industry. By expanding the types of materials that can be used for ethanol production and ensuring a stable supply of sugar, the government aims to boost both the environment and the economy. The full effects of this new policy will become clearer in the months ahead as industry experts and stakeholders observe its impact on the sugar and ethanol markets.
