Department of Food & Public Distribution
notified modified scheme to enhance ethanol distillation capacity in the
country for producing 1st Generation (1G) ethanol from feed stocks such
as cereals (rice, wheat, barley, corn & sorghum), sugarcane, sugar
beet etc.
DoFPD writes to Chief Secretaries of all State Governments/ UTs to promote the scheme
To achieve 20% blending by 2025 as well as to meet out the requirement of ethanolproduction capacity in the country, the Department of Food & Public Distributionhas
modified earlier scheme & notified the modified scheme for
extending financial assistance to project proponents for enhancement of
their ethanol distillation capacity or to set up distilleries for
producing 1st Generation (1G) ethanol from feed stocks such as cereals
(rice, wheat, barley, corn & sorghum), sugarcane, sugar beet etc. or
converting molasses based distilleries to dual feedstock vide
notification dated 14th January, 2021. For availing
assistance under this scheme, the sugar mills/ distilleries /
entrepreneurs would be required to submit an application in the
prescribed proforma to DFPD within 30 days from the date of notification
of the scheme online on the DFPD portal (https://sugarethanol.nic.in).
The
Chief Secretaries of all State Governments/ UTs have been requested to
promote the scheme to the entrepreneurs of their state and encourage
them to participate in the scheme so that the target set by the
Government could be achieved well within the timeline. State Governments
have also been requested to facilitate entrepreneurs in arranging land
for the project, to get environment clearance at the earliest & in
setting up of distilleries. Industry Associations have also been
requested to promote the scheme and encourage their members to
participate in the scheme.
Under
the scheme , Government would bear interest subvention for five years
including one year moratorium against the loan availed by project
proponents from banks @ 6% per annum or 50% of the rate of interest
charged by banks whichever is lower for setting up of new distilleries
or expansion of existing distilleries or converting molasses based
distilleries to dual feedstock. This will bring an investment of about
Rs. 40,000 crore. Due to upcoming investment in capacity addition / new
distilleries, various new employment opportunities will be created in
rural areas.For production of ethanol, there is sufficient availability
of feed stocks; & Government has also fixed remunerative prices of
ethanol derived from various feed stocks. Moreover, OMCs being the
assured buyer for ethanol has given comfort for purchase of ethanol from
distilleries for next 10 years. As such the upcoming ethanol projects
are viable.
This
scheme would not only facilitate diversion of excess sugar to ethanol
but would also encourage farmers to diversify their crops to cultivate
particularly maize/corn which needs lesser water compared to sugarcane
and rice. It would enhance production of ethanol from various feed
stocks thereby, facilitate in achieving blending targets of ethanol with
petrol and would reduce import dependency on crude oil , thereby,
realizing the goal of Atmanirbhar Bharat. It will also enhance income of
farmers as setting up of new distilleries would not only increase
demand of their crops but would assure farmers of getting better price
for their crops.
Sugarcane
and ethanol is produced mainly in three states viz Uttar Pradesh,
Maharashtra and Karnataka. Transporting ethanol to far flung States from
these three states involves huge transportation cost. By bringing new
grain based distilleries in the entire country would result in
distributed production of ethanol and would save a lot of transportation
cost and thus prevent delays in meeting the blending target & would
benefit the farmers across the country.
With
the vision to boost agricultural economy, to reduce dependence on
imported fossil fuel, to save foreign exchange on account of crude oil
import bill & to reduce the air pollution, the Government has fixed
target of 10% blending of fuel grade ethanol with petrol by 2022 &
20% blending by 2030. It is expected that in current ethanol supply year
2020-21, about 325 crore liters ethanol is likely to be supplied to
OMCs to achieve 8.5 % blending levels. It is likely that we will be
achieving 10% blending target by 2022 with supply of 400 crore liters of ethanol.
With
a view of support sugar sector and in the interest of sugarcane
farmers, the Government has also allowed production of ethanol from
B-Heavy Molasses, sugarcane juice, sugar syrup and sugar; and has been
fixing the remunerative ex-mill price of ethanol derived from C-heavy
molasses, B-heavy molasses and ethanol derived from sugarcane juice/
sugar/ sugar syrup for ethanol season. To increase production of fuel
grade ethanol, Govt. is also encouraging distilleries to produce ethanol
from maize; & rice available with Food Corporation of India.
Now
it has been proposed to prepone the 20% blending of ethanol with petrol
by 2025. To achieve 20 % blending by 2025 & to meet the requirement
of chemical & other sectors, about 1200 crore liters of alcohol /
ethanol would be required; out of which 900 crore liters would be
required to achieve 20% blending & 300 crore liters would be the
requirement of chemical & other sectors. Out of total requirement of
1200 crore liters, 700 crore liters is required to be supplied by sugar
industry & another 500 crore liters need to be supplied by grain
based distilleries. To produce 700 crore liters of ethanol by sugar
industry, about 60 Lakh Metric Tonne (LMT) of surplus sugar would be
diverted to ethanol which would solve the problem of excess sugar,
relieve sugar industry from the problem of storage of surplus sugar,
& improve the revenue realization of sugar mills which will
facilitate them in making timely payment of cane dues of sugarcane
farmers. About 5 crore sugarcane farmers & their families & 5
lakh workers associated with sugar mills & other ancillary
activities would be benefitted with this intervention. To produce 500
crore liters of ethanol/alcohol from food grains, about 125 LMT of food
grains would be utilized; this extra consumption of surplus food grains
would ultimately benefit the farmers as they will get better price for
their produce and assured buyers; and thus will also increase the income
of crores of farmers across the country.
****
SOURCE PIB NEWS
{ With input from news agency language)
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