NEW DELHI: India’s journey to blend locally produced ethanol with imported petrol has spanned over two decades. Though progress was gradual initially, the initiative gained significant traction after the Narendra Modi-led government took office in 2014. Today, India has surpassed its ambitious 20% ethanol blending (E20) target well ahead of the original 2030 timeline.
Yet, despite government acclaim, the programme is facing growing scrutiny from car buyers. The distinct chemical properties of ethanol compared to petrol are reportedly impacting the performance and longevity of vehicles not explicitly designed for higher ethanol blends. The government, however, insists these concerns are minor compared to the programme’s broader advantages: conserving foreign exchange, cutting carbon emissions, and boosting farmers’ incomes.
Union Minister of Road Transport and Highways Nitin Gadkari recently dismissed concerns over ethanol-blended petrol, challenging critics to cite a single instance of an issue caused by the fuel. “By putting 20% ethanol-blended petrol, has there been any car in the country that has faced issues? Just name one…There is no example of any car facing issues due to ethanol-blended petrol,” he added.
Petroleum minister Hardeep Singh Puri also downplayed the concerns, stating that E20 fuel reduces performance by a marginal 1-3% and causes no engine failures. “German, Japanese and all of them will tell you they’re running the same engine there. But I have never heard of engine failure (after using E20 fuel),” he said at a recent event.
The conception
The Ethanol Blended Petrol (EBP) Programme in India was officially launched in January 2003, aiming for 5% ethanol blending in petrol in nine states and four Union Territories. The scope grew over years, expanding coverage and attempting to boost blending levels, but average national blending rates remained below 1.5% till about 2014 due to supply and pricing challenges.
Significant policy interventions since 2014 led to sharp increase in blending. By June 2022, India achieved 10% blending (E10), several months ahead of its deadline. The target for 20% blending (E20) was advanced from 2030 to 2025-26 due to rapid progress. India successfully achieved 20% ethanol blending in petrol by March this year.
According to government data, blending brought economic benefits. India saved nearly Rs 1.4 lakh crore in foreign exchange, funds that would have otherwise been spent in purchasing crude oil from foreign nations. Farmers received an infusion of over Rs 1.18 lakh crore for their sugarcane, corn, and surplus grain.
Blending at mass level first took off in Brazil. At present, the South American country has a well-established ethanol blending programme, currently mandating a 27% blend of ethanol (E27) in gasoline. Its government in June decided to move forward with an increase in ethanol blending rates into petrol to 30% to make E30, and blend 15% biodiesel into diesel to create B15. E0 (pure gasoline), E5 (5% ethanol), and E10 (10% ethanol) petrol are generally not available at fuel stations in Brazil.
The US mainstreamed E10 under its Renewable Fuel Standard from 2005, with corn as the primary ethanol source. Many fuel stations also provide several ethanol blend options at a single location, typically using blender pumps. Blending in Europe is yet to take off. In large economies such as Germany, Finland and France, consumers have the choice between E10 and E5 at fuel stations. However, the uptake has been slow over worries about engine safety, strong consumer protection laws and rigorous labelling.
Consumers neglected
The E20 success story is now facing setbacks. As ethanol-blended petrol went mainstream, vehicle owners, especially those with older models, voiced fears about potential wear and tear on engines and reduced mileage. The petroleum ministry recently confirmed that four-wheelers designed for E10 and calibrated for E20 may experience a 1-2% drop in mileage, while other vehicles may see a reduction of 3-6%. While the government’s claim of up to 6% reduction in mileage on older vehicles suggests a limited impact, consumers and some experts believe the impact on mileage to be a little higher.
“By its chemical composition, ethanol has lower energy per unit volume than petrol. This results in reduced fuel efficiency from any ethanol-blended petrol when compared to unadulterated petrol. While our internal estimate shows that E20 petrol gives 5-7% lower mileage than unadulterated petrol, primarily in vehicles manufactured before 2023, consumer feedback suggests the impact to be in double digits in real-world driving conditions,” said the head technical officer of a leading car company on the condition of anonymity.
An industry expert cited that ethanol is hygroscopic (attracts water) and more corrosive than petrol. He stated that over time, this can lead to increased wear of rubber and plastic components (like gaskets, seals, hoses). He added the possibility of fuel leaks, degraded fuel pumps and clogged injectors, especially in older vehicles which are not designed for higher ethanol blends and are not maintained routinely.
Automakers have also pointed to potential technical issues and reduced fuel efficiency, particularly with higher ethanol blends such as E20. In an email response to a consumer’s query, Japanese carmaker Toyota stated that it is not advisable to use E20 and that usage of any fuel (other than recommended as per Owner’s Manual) will void Toyota Warranty for the impacted parts.
Two-wheeler major Hero MotoCorp said that vehicles manufactured before April 2023, may require modifications in the engine fuel system for it to be tuned to run efficiently on E20 fuel. “Certain rubber, elastomers and plastic components (like gasket, O-rings, fuel tube, etc.) may need to be replaced for prolonged usage with new parts made with E20 compatible material,” it added.
TVS Motor says that compared to gasoline, ethanol has different chemical characteristics, and it is corrosive to several materials that are frequently used in fuel systems. Component deterioration or damage could result from compatibility problems, it added.
Govt says all is well
Despite growing concerns and calls for availability of E0, E5 and E10 petrol in fuel stations, the ministry of Petroleum and Natural Gas in a detailed response earlier this week rejected allegations that E20 reduces performance of the vehicle, adding the use of E20 gives better acceleration, better ride quality and most importantly, lowered carbon emissions by approximately 30% as compared to E10 fuel.
“Ethanol’s higher-octane number (108.5 compared to petrol’s 84.4) makes ethanol-blended fuels a valuable alternative for higher-octane requirements that is crucial for modern high-compression engines. Vehicles tuned for E20 deliver better acceleration which is a very important factor in city driving conditions,” it stated.
The government said that critiques suggesting that E20 causes a “drastic” reduction in fuel efficiency are misplaced. It added that vehicle mileage is influenced by a variety of factors beyond just fuel type. These include driving habits, maintenance practices such as oil changes and air filter cleanliness, tyre pressure and alignment, and even air conditioning load. The efficiency drop (if any) in E10 vehicles has been marginal…The alternative of going back to E-0 would involve losing the hard fought gains on pollution and the success achieved in energy transition,” it said.
On a wider call that blended petrol should be cheaper than non-blended fuel, the government stated that the procurement price of ethanol has increased and now its weighted average price is higher than the cost of refined petrol.
Currently, the average procurement cost of ethanol for 2024-25, as on 31.07.2025, is Rs 71.32 per litre, inclusive of transportation and GST. For producing E20, OMCs blend 20% of this procured ethanol with Motor Spirit (MS). Price of C-heavy molasses based ethanol increased from Rs 46.66 (ESY 2021-22) to Rs 57.97 (ESY 2024-25). Price of Maize-based ethanol increased from Rs 52.92 to Rs 71.86 over the same period.
“Despite the increase in price of ethanol in comparison to petrol, the oil companies have not gone back on the ethanol blending mandate because the programme delivers on energy security, boosts farmers’ incomes and environmental sustainability,” the ministry.
Critics, however, feel that if ethanol has become pricier than refined petrol, then it takes away the most important purpose of blending. They feel that as in the case of most countries where blending is rampant, consumers should have the option to choose the fuel they feel is best for their vehicle. Industry body SIAM says moving to E20 is a logical progression but 6% drop in fuel efficiency is substantial and needs to be overcome.
Did you know?
Petrol sold at fuel stations in India are E20 now — 20% ethanol and 80% petrol. Older variants like E5 and E10 have been discontinued at most places
Fuel stations rarely display whether the petrol is E20 or E10 or E5. Even workers at fuel stations have insufficient knowledge about blending
If you choose to buy 100-octane petrol, you will have to pay more. XP100 currently costs around Rs 160 per litre in Delhi and Mumbai and is also not available everywhere in India