Transportation
Politics
Economics
Energy
Environment
Oil Prices
Economic Impact
Biofuels
Ethanol blending
Environmental gains
Ethanol production
Fuel consumption
Import dependency
Ethanol blending in India ......
-> Why Ethanol blending in fuel is imp to India
-> History of Ethanol blending programme
-> Environmental gains
-> Ethanol in India: Current Production Capacity and growth and Demand
-> Govt price incentives
-> Top beneficiaries companies
-> Why Ethanol blending in fuel is imp to India
-> History of Ethanol blending programme
-> Environmental gains
-> Ethanol in India: Current Production Capacity and growth and Demand
-> Govt price incentives
-> Top beneficiaries companies
Main promotion for industrial ethanol is blending with petrol and thereby increasing the use of biofuels in fossil fuel consumption
Currently ~98% of the road transport sector is met by fossil fuels (diesel & petrol) and only 2% is met by biofuels
Currently ~98% of the road transport sector is met by fossil fuels (diesel & petrol) and only 2% is met by biofuels
As per national statistics, India imports 85% of its fossil fuel demand, which
- increases India's vulnerability to fluctuation in oil prices
- is a drain on the entire economy and its foreign reserves
- increases India's vulnerability to fluctuation in oil prices
- is a drain on the entire economy and its foreign reserves
Domestic biofuels provide a strategic opportunity to reduce the dependence on fossil fuels.
To address the challenge National biofuels policy was enacted. Among other things it has put a target of
- 20% ethanol blending in petrol
- 5%blending of biodiesel in diesel
by 2030.
To address the challenge National biofuels policy was enacted. Among other things it has put a target of
- 20% ethanol blending in petrol
- 5%blending of biodiesel in diesel
by 2030.
Ethanol blending is not new and is being successfully implemented in a lot of countries - US, UK, Brazil, China and EU
Other than reducing the dependence, biofuels also provide environmental gains due to lower emissions
- E10 reduces CO by 20%
- E20 reduces CO by 30 - 50%
Other than reducing the dependence, biofuels also provide environmental gains due to lower emissions
- E10 reduces CO by 20%
- E20 reduces CO by 30 - 50%
# Current production capacity ~700Cr litres (60% molasses and 40% grain based)
# By 2025 the capacity is expected to more than double to 1500Cr litres (50% each from molasses and grain)
The capacity is being doubled largely driven by government incentives
# By 2025 the capacity is expected to more than double to 1500Cr litres (50% each from molasses and grain)
The capacity is being doubled largely driven by government incentives
Government has provided attractive price mechanism to PSU OMCs to procure ethanol from various sources, because of which
Ethanol blending quantity has increased by 10X in last 7 years
In 2020-2021, India achieved 8.1% blending, its highest ever
Ethanol blending quantity has increased by 10X in last 7 years
In 2020-2021, India achieved 8.1% blending, its highest ever
- the vehicle growth projections (and hence the fuel consumption), and
- the demand for ethanol growth up and above the petrol blending
it is expected that the volume of ethanol required will grow very steeply and will act as a growth catalyst for ethanol industry
- the demand for ethanol growth up and above the petrol blending
it is expected that the volume of ethanol required will grow very steeply and will act as a growth catalyst for ethanol industry
Even with the EV penetration, the ethanol demand is expected to grow.
The problem is so gross that we need all the solutions
The problem is so gross that we need all the solutions
Beneficiaries of his trend are the sugar and ethanol makers and
NEITHER the retail fuels marketing companies
NOR the auto manufacturers
NEITHER the retail fuels marketing companies
NOR the auto manufacturers
Top companies that are going to benefit from this trend are:
# Renuka Sugars
# Balrampur Chini
# E I D-Parry
# Triveni Engineering
# Dalmia Bharat Sugar
# Praj Ind
# ISGEC Ind
# Globus Spirits
# Renuka Sugars
# Balrampur Chini
# E I D-Parry
# Triveni Engineering
# Dalmia Bharat Sugar
# Praj Ind
# ISGEC Ind
# Globus Spirits
Renuka Sugars
# Largest sugar maker in India
# brand 'Madhur'
# 32% market share
# Existing capacity 720 KLPD (6% share)
# adding another ~700 KLPD by end 2022
# 10% sales and 24% EBIT from ethanol in FY21
# Owns KBK Engineering, provides turnkey ethanol solutions
# Largest sugar maker in India
# brand 'Madhur'
# 32% market share
# Existing capacity 720 KLPD (6% share)
# adding another ~700 KLPD by end 2022
# 10% sales and 24% EBIT from ethanol in FY21
# Owns KBK Engineering, provides turnkey ethanol solutions
Balrampur Chini
# based out of UP
# Existing capacity 520 KLPD (4.5% share)
# adding another ~300 KLPD by end 2022
# 15% sales and 50% EBIT from ethanol in FY21
# based out of UP
# Existing capacity 520 KLPD (4.5% share)
# adding another ~300 KLPD by end 2022
# 15% sales and 50% EBIT from ethanol in FY21
E I D-Parry
# Oldest sugar company with 225 years of operations
# Operations in TN, AP and Karnataka
# part of Murugappa group
# Existing capacity 235 KLPD (2% share)
# adding another ~150 KLPD by end 2022
# 15% sales and 15% EBIT from ethanol in FY21
# Oldest sugar company with 225 years of operations
# Operations in TN, AP and Karnataka
# part of Murugappa group
# Existing capacity 235 KLPD (2% share)
# adding another ~150 KLPD by end 2022
# 15% sales and 15% EBIT from ethanol in FY21
Triveni Engineering
# conglomerate operating across agriculture and engineering based out of UP
# Existing capacity 320 KLPD (2.8% share)
# adding another ~350 KLPD
# 11% sales and 19% EBIT from ethanol in FY21
# conglomerate operating across agriculture and engineering based out of UP
# Existing capacity 320 KLPD (2.8% share)
# adding another ~350 KLPD
# 11% sales and 19% EBIT from ethanol in FY21
Dalmia Bharat Sugar
# based out of UP
# part of Bharat Dalmia group
# preferred sugar supplier to giants like Coco Cola, Pepsi, Britannia and UB
# Existing capacity 240 KLPD (2% share)
# adding another 240 KLPD
# 16% sales and 42% EBIT from ethanol in FY21
# based out of UP
# part of Bharat Dalmia group
# preferred sugar supplier to giants like Coco Cola, Pepsi, Britannia and UB
# Existing capacity 240 KLPD (2% share)
# adding another 240 KLPD
# 16% sales and 42% EBIT from ethanol in FY21
Praj Industries
# Global supplier for sustainable solutions for bioenergy and water treatment
# provide turnkey solutions for ethanol plants
# majority sales from bioenergy segment
# Global supplier for sustainable solutions for bioenergy and water treatment
# provide turnkey solutions for ethanol plants
# majority sales from bioenergy segment
ISGEC Industries
# 13% of the sales and order book from sugar
# 88% of its orders are domestic so likely to benefit from the ethanol blending program
# 13% of the sales and order book from sugar
# 88% of its orders are domestic so likely to benefit from the ethanol blending program
Globus Spirits
# largest manufacturer of bulk alcohol extra neutral alcohol
# It sells IMIL, IMFL, hand sanitizers and franchisee bottling
# Current capacity 500 KLPD (4.1% share)
# adding another 400 KLPD
# ~55% of the capacity is used for bulk alcohol
# largest manufacturer of bulk alcohol extra neutral alcohol
# It sells IMIL, IMFL, hand sanitizers and franchisee bottling
# Current capacity 500 KLPD (4.1% share)
# adding another 400 KLPD
# ~55% of the capacity is used for bulk alcohol
Source : youtube.com
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