Decarbonizing mobility solutions

Prime Minister Narendra Modi launching E 20 fuel (fuel blended with 20% ethanol) at select outlets of Oil Marketing Companies (OMC) in 11 States and Union Territories marks another significant milestone in the country's ethanol blending roadmap. While car manufacturers have been asked to produce E-20 compliant vehicles by 2025, retail outlets of OMC will be required to keep separate tanks for E-10 fuel for at least another ten years as existing vehicles are not E-20 complaint. The government plans to rollout E20 fuel in the entire country in a phased manner over the next two years. The country's Ethanol Blending Programme is aimed at achieving twin objectives of cutting down carbon emissions and reducing crude import bill. Total rollout of E20 fuel is projected to cut India's energy import bill by Rs 30000 crores annually provided target of 1016 crore litres of ethanol production is achieved to cater to the projected vehicle demand. Use of E 20 is estimated to reduce emission of carbon monoxide by 50% in two wheelers and by 30% in four wheelers which explain the emphasis laid by the government in achieving the targets as fast as possible. The "Roadmap for Ethanol Blending in India: 2020-2025", however, cautioned that high compression ratio engines may face catastrophic failure due to engine knocking when operated with low or nil ethanol content and the vehicles which are designed for low or nil content of ethanol in gasoline will result in lower fuel economy if used with higher ethanol blends. The report estimates that when using E20, there is an estimated loss of 6-7% fuel efficiency for four wheelers which are originally designed for E0 and calibrated for E10, 3-4% for two wheelers designed for E0 and calibrated for E10 and 1-2% for four wheelers designed for E10 and calibrated for E20. Reduction in fuel efficiency will be a cause of concern for existing owners of vehicles designed for E10 and manufacturers of such vehicles addressing which is necessary to make E20 rollout smooth. India's share in the global oil demand is projected to increase to 11% from the current level of 5% and gas demand is projected to rise 500%. While rise in energy demand will bring opportunities of investment, decarbonizing the energy sector is critical for achieving the updated targets in India's Nationally Determined Contribution (NDC) submitted under the Paris Agreementof reducing emissions intensity of its GDP by 45% by 2030 from 2005 levels. The four major verticals for the strategy for the energy sector outlined by the Prime Minister are: increasing domestic exploration and production, diversifying the supply, and expanding use of biofuel, ethanol, compressed biogas and solar and de-carbonisation via electric vehicles and hydrogen. The Final Report of the Task Force on Sugarcane and Sugar Industry constituted by the NITI Aayog in 2020 estimated that with over 70 lakh tonnes of surplus sugar in the country there is large scope for diverting surplus sugarcane towards ethanol production without affecting sugar supply needed to meet domestic demand. It also highlights that one tonne of sugarcane yields 70 litres of ethanol while producing one tonne of sugar is equivalent to producing 600 litres of ethanol. Apart from using sugarcane, successful use of bamboo as feedstock in the Assam Bio Refinery will be critical to use of bamboo, which naturally grows in abundance in northeast region as alternative crop for ethanol production while simultaneously addressing the concern of depletion of water level due production of sugarcane and paddy cultivation grown using irrigation water. This will also open huge opportunities for entrepreneurship in the northeast region ethanol production and become key stakeholders in the country's EBP. Incentives to sugarcane and bamboo growers will play the crucial role in meeting the targets of ethanol production. India getting its due share from the climate finance mobilization committed by developed countries can facilitate rolling out of attractive incentives to promote raw material for ethanol production. Information furnished by the Government in the parliament shows despite their commitment in 2009 of a climate finance mobilization goal of USD 100 billion per year, by 2020 to address the needs of developing countries, the goal has not been met. India's climate actions have so far largely been financed from domestic sources, including government budgetary support as well as a mix of market mechanisms and fiscal instruments and policy interventions. Building awareness on the EBP, ethanol use efficiency vis-à-vis its importance in reducing emissions for preventing rise in global temperature and climate change mitigation will be crucial to motivate vehicle owners to upgrade to E20 compliant vehicles. Weighing on market sentiments for expensive electric vehicles and E 20 compliant vehicles and policy of incentivizing on ethanol blended fuel can create positive sentiments among vehicle owners to voluntarily transition to environment-friendly vehicles for decarbonizing their mobility solution.