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As per the decision, the administered ex-mill price of ethanol derived from C-heavy molasses has been increased by ₹1.39 to ₹57.97 per litre, up from ₹56.58 per litre.
The price of ethanol from B-heavy molasses remains at ₹60.73 per litre. Goods and Services Tax (GST) and transportation costs will be paid separately to ensure fair pricing for ethanol suppliers.
The government expects that the 3% increase in C-heavy molasses ethanol prices will help ensure sufficient availability to meet blending targets.
The EBP Programme, which enables OMCs to blend ethanol with petrol, is aimed at reducing dependence on imported crude oil and promoting environmentally friendly fuels.
Over the last decade, ethanol blending has risen significantly, from 38 crore litres in 2013-14 to 707 crore litres in 2023-24, achieving an average blending rate of 14.6%. This has resulted in foreign exchange savings of over ₹1.13 lakh crore and the substitution of 193 lakh metric tonnes of crude oil.
The government has advanced its target of achieving 20% ethanol blending from 2030 to ESY 2025-26.
For ESY 2024-25, OMCs plan to achieve 18% blending. The expansion of ethanol distillation capacity to 1,713 crore litres per annum, along with long-term off-take agreements and incentives for dedicated ethanol plants in deficit states, is expected to support this goal.
The EBP Programme has also driven significant investments in greenfield and brownfield distilleries, storage, and logistics, creating employment and supporting farmers.
