Some food for thought on conversion of Molasses for production of Ethanol, as a viable bio-fuel:
India is the world's fifth largest primary energy consumer and fourth largest petroleum consumer after United States, China and Japan. Despite the recent global economic slowdown, India's economy is expected to continue to grow at 6 to 8 percent per year in the near term. With an outlook for moderate to strong economic growth and a rising population, growing infrastructural and socio-economic development will stimulate an increase in energy consumption across all major sectors of the Indian economy.
In the recent past, starting in Indian fiscal year 2009/10, imports of gasoline and petroleum products has outgrown total domestic consumption by more than 14 percent. While India's domestic energy base is substantial, the country continues to rely on imports for a considerable amount of its energy use , consequently escalating India?s oil import expenditure to over $135 billion in IFY 2011/12, up 22 percent over the previous year. Concurrently, petroleum consumption in India has also grown in tandem to 148 million tons.
In terms of end usage, energy demand across the transport sector ( Petrol, Diesel, CNG, Aviation Fuel-51% ) is greatest. Roads, being one of the dominant infrastructures for transport, carry an estimated 85 to 90 percent of the country's passenger traffic and 65 percent of its freight. Traffic on roads is growing at a rate of 7 to 10 percent per year; while the vehicle growth is of the order of 8 to 10 percent per year.
As vehicle ownership expands, petroleum demand in the transport sector is expected to grow in tandem. Diesel and gasoline account for more than 95 percent of the requirement for transportation fuel, and demand is expected to grow at 6 to 8 percent over the coming years.
Given that India is the fourth largest global contributor to carbon emissions, the GOI transport policy has targeted EURO-III and IV vehicle emission norms for vehicles, which in turn would require adoption of clean and green fuel. The government is seriously concerned about economic, environmental, energy security while looking to alternate fuels to meet energy demand through safe, clean, and convenient forms of energy at least cost in a technically efficient, economically viable and environmentally sustainable manner. To meet these objectives, the Union Cabinet approved the National Policy on Biofuels on December 24, 2009 (PIB press release). Endowed with significant potential for generating energy through renewable resources, the Government of India (GOI) is promoting production and use of i) ethanol derived from sugar molasses/juice for blending with gasoline and ii) biodiesel derived from inedible oils and oil waste for blending with diesel.
Some recent clippings from the News Papers:
In the National Policy on Biofuels announced in 2008, the Government of India mandated phased implementation of a programme of ethanol blending with petrol. Lack of resolve on the part of the government to enforce the decision that it has since announced over and over again is the only reason that can be cited for the inertia on this front. Last heard, the government had postponed the deadline for the nationwide roll-out from December 1, 2012 to June 1, 2013. The government having cleared the import of the commodity, the public sector oil marketing companies were reported to be moving jointly to float a Rs. 3,500-crore global tender to source ethanol. The annual requirement is estimated to be about 1,000 million litres for a pan-India roll-out of 5 per cent blended petrol, which is already available in some States. While getting started at 5 per cent has been such a slog for India, countries like the United States now have established ‘doping’ programmes that involve up to 20 per cent ethanol.
India’s ethanol source is molasses which is produced from sugarcane juice.
Molasses attract a good price, as the fertilizer industry and some European countries buy it. Extra neutral alcohol produced from molasses is required in chemical companies. It is useful for making potable alcohol and ethanol. If the market for these byproducts is explored, sugar factories can give Rs 100 per tonne extra to sugarcane farmers.
India stands to save a huge amount of foreign exchange through the blending programme, provided it gets ethanol at a viable price. "As per the presentations made before the Union government, close to Rs 6 lakh crore is spent on oil imports. If we start blending 5% ethanol in petrol, we will save millions of rupees.
"The current retail price of petrol is close to Rs 70 per litre in the domestic market. If the oil companies mix 5% ethanol bought at the rate of Rs 38 per litre, they can bring down the petrol price by Rs 10 per litre. It will mean a huge amount of savings.
"However, sufficient lead time should be given to the auto industry to carry out engine and other modifications to make vehicles compatible with still higher levels of blended fuel.
Issues:
1. Ethanol is the basic product, lowest in the value chain, after the conversion of Molasses. Hence, its supply for blending with Petrol, on a stainable basis, can not be assured unless the price is remunerative enough.
2. To make the availability of molasses for conversion at reasonable prices, the inter state movement of molasses needs to be immediately freed from state regulations.
3. Till the time the auto companies modify their vehicles to be compatible with ethanol blended petrol both ethanol blended and non blended petrol needs to marketed.
4. To promote wide spread usage and faster penetration of ethanol blended petrol, GOI should consider giving tax holidays to ethanol production, since it will entail huge savings of forex and will help bring down oil import bill and consequent current account deficit of India. Taxes can be levied subsequently after ethanol blended petrol has reached a stage of wide spread acceptability and fully embeded into the system.
5. Ethanol being an agri based product, most of the problems related to sugar cane farming and pricing once resolved, will lead to an exponential growth of sugar cane production in India. An excellent, sustainable, green economic development model which can lead to much higher GPD growth in coming years.
For complete information on Molasses/ethanol value added chain please visit, www.indiaglycols.com
4. To promote wide spread usage and faster penetration of ethanol blended petrol, GOI should consider giving tax holidays to ethanol production, since it will entail huge savings of forex and will help bring down oil import bill and consequent current account deficit of India. Taxes can be levied subsequently after ethanol blended petrol has reached a stage of wide spread acceptability and fully embeded into the system.
5. Ethanol being an agri based product, most of the problems related to sugar cane farming and pricing once resolved, will lead to an exponential growth of sugar cane production in India. An excellent, sustainable, green economic development model which can lead to much higher GPD growth in coming years.
For complete information on Molasses/ethanol value added chain please visit, www.indiaglycols.com
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