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November 19, 2019 Tuesday 10:48:17 AM IST

National Policy on Biofuels

Policy Indications

Government has notified the new National Policy on Biofuels – 2018 on 08.06.2018. The salient features of the Policy are as under:

(i)  Categorization of biofuels as “Basic Biofuels” and “Advanced Biofuels”,

(ii) Incentives, off-take assurance and viability gap funding for advanced biofuels,

(iii) Allowing B-molasses, sugarcane juice, damaged food grains and surplus food grains for ethanol production,


(iv) Setting up of supply chain mechanisms for biodiesel production from non-edible oilseeds, Used Cooking Oil, short gestation crops, and

 (v) Synergy of efforts by defining roles and responsibilities of all the concerned Ministries/Departments with respect to biofuels.

In line with National Policy on Biofuels, Government has approved “Pradhan Mantri JI-VAN (Jaiv Indhan- Vatavaran Anukool FasalAwashesh Nivaran) Yojana” for providing financial support to Integrated Bio-Ethanol Projects using lignocellulosic biomass & other renewable feedstock, with a total financial outlay of Rs 1969.50 crore for the period 2018-19 to 2023-24.

The ethanol blended petrol percentage has progressively increased from 1.53% in ethanol supply year (ESY) 2013-14 (December 2103 to November 2014) to 4.22% in ESY 2017-18. Presently, as on 11.11.2019, 180.80 crore litre of Ethanol has been procured against target of ethanol procurement of 225 crore litre for Ethanol Supply Year 2018-19. Department of Food & Public Distribution (DFPD) has informed that the total effective ethanol production capacity of the distilleries attached with the sugar mills in the country is about 355 crore litres per annum. DFPD has further informed that for reopening of closed public and cooperative sugar mills, responsibility lies with concerned State Governments/Union Territories. In case of private sugar mills, the entrepreneur has to take steps to reopen closed sugar mills.


Sustainable Alternative Towards Affordable Transportation (SATAT) scheme envisages establishing 5000 Compressed Bio Gas (CBG) plants across the country by 2023. Under this scheme, Oil Public Sector Undertakings have invited Expression of Interest (EoI) for procuring CBG from potential entrepreneurs and has offered an assured price for off take of CBG.

The Government through Oil Marketing Companies (OMCs) is implementing the Ethanol Blended Petrol (EBP) programme under which, OMCs sell ethanol blended petrol with percentage of ethanol upto 10% subject to its availability. OMCs procure ethanol for blending in petrol. In the current Ethanol Supply Year 2018-19, 180.80 crore litre of ethanol has been procured by OMCs upto 11.11.2019.

To encourage procurement of biodiesel produced from Used Cooking Oil (UCO), OMCs have floated Expression of Interest (EoI) for setting up of biodiesel plants from UCO processing plants on 10.08.2019 across India for 100 locations.  It was further extended to 200 locations on 10.10.2019.


This information was given by the Union Minister for Petroleum and Natural Gas Shri Dharmendra Pradhan in a written reply in the Lok Sabha.

Ministry of Petroleum & Natural Gas