BharatNotes Biofuels — fuels derived from biological materials (biomass, crops, organic waste) — occupy a critical place in India's energy security and climate strategy. With over 85% of crude oil requirements met through imports (FY 2023-24), substituting a portion of petroleum fuels with domestically produced biofuels reduces the import bill, supports farmers, and cuts greenhouse gas emissions. India's National Biofuel Policy 2018 (amended 2022) and the Ethanol Blended Petrol (EBP) Programme are central exam topics in GS Paper III.
1. Classification of Biofuels
| Generation | Feedstock | Examples | Key Concern |
|---|---|---|---|
| 1st Generation | Food crops (edible sugars, starch, vegetable oils) | Sugarcane ethanol, corn ethanol, soybean biodiesel | Food vs fuel competition |
| 2nd Generation | Non-food lignocellulosic biomass, agricultural residue | Rice straw, wheat straw, wood chips, bagasse | Conversion technology cost |
| 3rd Generation | Algae | Microalgae biodiesel | High production cost; early stage |
| 4th Generation | Engineered organisms / CO2 capture | Synthetic biology approaches | Largely experimental |
India's current focus is predominantly on 1st generation ethanol (from sugarcane and food grains) transitioning towards 2nd generation (lignocellulosic) sources.
2. National Biofuel Policy 2018 (NBP 2018)
The National Policy on Biofuels, 2018, approved by the Cabinet in May 2018, superseded the earlier 2009 policy and is administered by the Ministry of Petroleum and Natural Gas (MoPNG) with MNRE playing a supporting role in technology development.
Key Targets (Original NBP 2018)
| Fuel | Target | Target Year |
|---|---|---|
| Ethanol blending in petrol | 20% (E20) | 2030 |
| Biodiesel blending in diesel | 5% (B5) | 2030 |
NBP 2018 — Amendment 2022 (Critical Change)
The National Policy on Biofuels (Amendment), 2022 advanced the E20 target from 2030 to ESY (Ethanol Supply Year) 2025-26 — a five-year acceleration, triggered by India's rapid progress in ethanol blending.
Additional changes in the 2022 amendment:
- Expanded feedstock basket: sugarcane juice, B-heavy molasses, damaged food grains (wheat, broken rice), corn, and surplus rice
- Allowed surplus rice from FCI stocks to be used for ethanol production
- Enabled advanced biofuel projects (2G) to receive financial support under the SATAT and other schemes
3. Ethanol Blended Petrol (EBP) Programme — Progress
India's ethanol blending programme is one of the fastest-moving biofuel transitions globally.
| Ethanol Supply Year | Blending Rate Achieved |
|---|---|
| ESY 2019-20 | ~5% |
| ESY 2021-22 | 10% (achieved June 2022 — 5 months ahead of schedule) |
| ESY 2022-23 | 12.06% |
| ESY 2023-24 | 14.60% |
| ESY 2024-25 | ~19.24% average (peaked 19.8% in Aug 2025; 17.98% as of Feb 2025) |
| ESY 2025-26 | E20 target achieved — ~20% |
India achieved the 20% ethanol blending milestone (on an aggregate basis) in 2025, representing a landmark in the programme.
Beyond E20: The government is now working towards an E30 target (30% blending) expected to roll out between 2028 and 2030, following a vehicle compatibility roadmap with the automobile industry.
Feedstock for Ethanol Production
| Feedstock | Route | Share in EBP Programme |
|---|---|---|
| C-heavy molasses | Traditional route; lowest ethanol yield from sugarcane | Historically dominant |
| B-heavy molasses | Higher ethanol yield; allowed post-2018 policy | Significant share |
| Sugarcane juice / syrup | Direct conversion; best yield | Growing share |
| Damaged food grains (wheat, broken rice) | Starch to ethanol; uses FCI surplus | Added post-2022 amendment |
| Corn | Starch route; year-round supply | Growing importance for supply security |
4. Biodiesel Programme
India's biodiesel ambitions have faced significant feedstock challenges.
| Feedstock | Status |
|---|---|
| Jatropha curcas | Non-edible oil-bearing shrub; promoted heavily in early 2000s; failed due to low yields on marginal lands, long gestation period, and poor returns for farmers |
| Karanja (Pongamia) | Non-edible oil; limited scale |
| Used Cooking Oil (UCO) | Growing feedstock; FSSAI "Turn the Cycle" initiative to channel UCO from restaurants and hotels to biodiesel refineries |
| Palm Stearin / industrial fats | Minor share |
India's biodiesel blend rate remains far below the 5% B5 target — projected at only ~0.7% for 2024-25 despite production of ~718 million litres in 2025 (60% increase over 2024). The jatropha promise did not materialise at scale.
5. Sustainable Aviation Fuel (SAF)
SAF is a drop-in aviation fuel made from non-petroleum feedstocks that can blend with conventional jet fuel without aircraft modification.
India has set progressive SAF blending mandates:
| Year | SAF Blending Mandate |
|---|---|
| 2027 | 1% |
| 2028 | 2% |
| 2030 | 5% |
IOCL's AtJ (Alcohol-to-Jet) Plant: Indian Oil Corporation Ltd is setting up an 86,800-tonne capacity AtJ plant at Panipat using LanzaJet technology, scheduled for commissioning in 2028. It will use ethanol as feedstock to produce SAF.
India is also cooperating with Brazil (the world's largest sugarcane ethanol producer) on SAF production and biofuel trade under the framework of the Global Biofuels Alliance (GBA) — launched at India's G20 Presidency summit in September 2023.
6. Food vs Fuel Debate
The diversion of agricultural land and food crops to biofuel production raises ethical and food security concerns:
| Concern | Counter-argument |
|---|---|
| Higher crop prices when food grains diverted to ethanol | India uses only surplus/damaged food grains (FCI stocks); sugarcane grown specifically as dual-use crop |
| Land-use competition: biofuel crops vs food crops | 2G biofuels use agricultural residue (straw); no additional land needed |
| Water-intensive sugarcane cultivation | AWD techniques and drip irrigation reduce sugar cane water footprint |
| Indirect land-use change | Policy mandates domestic feedstock; no large-scale import of biofuel feedstocks |
India's policy specifically guards against food security risks by allowing only surplus and damaged grain, not diverting food from consumption.
7. 2G Ethanol — The Next Step
Second-generation (2G) ethanol uses lignocellulosic biomass (rice straw, wheat straw, bagasse) rather than food crops. This addresses the food vs fuel conflict and also helps solve the stubble-burning problem.
- IOCL 2G Ethanol Plant, Panipat (Haryana): Commissioned in August 2022; capacity ~30 crore litres/year from paddy straw; first commercial-scale 2G ethanol plant in India
- This plant uses paddy straw from the Punjab/Haryana region — directly addressing the stubble-burning crisis that causes Delhi's winter air pollution
Recent Developments (2024–2026)
India Achieves 20% Ethanol Blending — Five Years Ahead of Schedule
India achieved the E20 target (20% ethanol blending in petrol) in 2025, approximately five years ahead of the original 2030 deadline set under the National Biofuel Policy 2018. During Ethanol Supply Year (ESY) 2024–25, Oil Marketing Companies (OMCs) achieved 19.93% blending by July 2025, effectively reaching E20. Blending rose from just 1.5% in ESY 2013–14 to 20% in ESY 2024–25 — a 13-fold increase.
The programme has generated significant benefits: approximately ₹1.36 lakh crore in foreign exchange savings (reduced petrol imports), ₹1.18 lakh crore payments to farmers for sugarcane and grain, and approximately 698 lakh tonnes of CO₂ emissions reduced. Ethanol capacity has grown to approximately 1,250 crore litres annually. India's target for ESY 2025–26 is a blending rate of 20%, with planning underway for E30 targets (National Biofuel Policy 2022 already provides a framework for E30).
UPSC angle: E20 achievement five years early, cumulative benefits (forex, farmer income, CO₂), and the policy evolution (NBP 2018 → amendment 2022 → E30 pathway) are Prelims and Mains key data.
Sustainable Aviation Fuel (SAF) Policy — India's 2024 Framework
India's Ministry of Civil Aviation and MNRE collaborated in 2024 to develop India's Sustainable Aviation Fuel (SAF) blending mandate. Civil aviation accounts for approximately 2.5% of global CO₂ emissions, and ICAO (International Civil Aviation Organisation) has adopted a long-term aspirational goal of net-zero carbon by 2050 for international aviation through the CORSIA (Carbon Offsetting and Reduction Scheme for International Aviation) mechanism.
India's SAF blending mandate, proposed at 1% by 2025 and scaling to 10% by 2030, uses feedstocks including agricultural residue (bagasse, corn stover), used cooking oil (UCO), and municipal solid waste. IndiGo and Air India have conducted trial SAF-blended flights. Feedstock availability and the high production cost of SAF (3–5 times conventional jet fuel) remain major challenges.
UPSC angle: SAF mandate, CORSIA, ICAO net-zero 2050 goal, and India's feedstock options are Mains GS-3 topics linking aviation emissions with biofuel policy.
Second-Generation (2G) Ethanol — Scale-up 2024
India's second-generation (2G) ethanol programme, which uses agricultural residue (rice straw, wheat straw, bagasse) rather than food crops, received major impetus in 2024. HPCL's 2G ethanol plant in Bargarh, Odisha — India's first commercial-scale 2G plant — achieved 99% technical reliability and produced approximately 3 crore litres in 2023–24. IOCL's 2G ethanol plant in Panipat, Haryana (using paddy straw from Punjab and Haryana to address stubble burning) ramped up production in 2024.
A dedicated funding window under the National Biofuel Coordination Committee (NBCC) supports 2G ethanol capacity building. 2G ethanol addresses both the food vs. fuel debate (by not using edible feedstocks) and the agricultural waste disposal problem (replacing stubble burning with valuable biofuel production).
UPSC angle: 2G ethanol, HPCL Bargarh plant, IOCL Panipat plant, and the stubble burning-ethanol nexus are Mains GS-3 content; feedstock categories (1G: molasses/grain vs 2G: agricultural residue) are Prelims terminology.
Exam Strategy
For Prelims:
- National Biofuel Policy 2018 approved in May 2018; administered by MoPNG
- Amendment 2022 advanced E20 target from 2030 to ESY 2025-26
- Blending milestones: 10% achieved in June 2022 (5 months ahead of schedule); ~19.24% average in ESY 2024-25 (peaked 19.8% in Aug 2025); E20 (~20%) achieved in ESY 2025-26
- E30 target: 2028-2030
- SAF mandates: 1% (2027) → 2% (2028) → 5% (2030)
- IOCL 2G ethanol plant at Panipat — uses paddy straw; commissioned August 2022
- IOCL AtJ (SAF) plant at Panipat — 86,800 tonnes; LanzaJet technology; 2028 target
- Global Biofuels Alliance launched at G20 India (September 2023)
For Mains (GS Paper 3):
- Frame biofuel answers around three dimensions: energy security (import substitution) + farmer income (price support for sugarcane) + environment (GHG reduction, stubble use)
- Biodiesel's failure from jatropha is a key lesson: "Policy must be based on proven technology and realistic feedstock economics, not aspirational projections"
- 2G ethanol from paddy straw kills two birds: reduces stubble burning + diversifies biofuel feedstock — a strong example of integrated policymaking
- Food vs fuel: India's approach uses surplus/damaged grain — not a food security risk in current context, but needs monitoring as E30 ambitions grow
