Biofuel Policy

[pib] World Biofuel Day, 2018 to be observed on 10th AugustPIBPrelims Only


Mains Paper 2: Governance | Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

From UPSC perspective, the following things are important:

Prelims level: World Biofuel Day

Mains level: The newscard summarizes various initiatives by government to reduce dependence of fossil fuels.


World Biofuel Day

  1. It is observed every year on 10th August to create awareness about the importance of non-fossil fuels as an alternative to conventional fossil fuels.
  2. It is also aimed to highlight the various efforts made by the Government in the biofuel sector.
  3. It is being observed by the Ministry of Petroleum & Natural Gas for the last three years.

Focus on Biofuel generation

  1. Biofuels have the benefits of reducing import dependency on crude oil, cleaner environment, and additional income to farmers and employment generation in rural areas.
  2. The biofuels programme is also in synergy with the Government of India initiatives for Make in India, Swachh Bharat and enhancing farmers’ income.
  3. The interventions include administrative price mechanism for ethanol, simplifying the procurement procedures of OMCs, amending the provisions of Industries (Development & Regulation) Act, 1951 and enabling lignocellulosic route for ethanol procurement.

Outcomes of Bio-fuel Programme

  1. Ethanol blending in petrol has increased from 38 crore litres in the ethanol supply year 2013-14 to an estimated 141 crore litres in the ethanol supply year 2017-18.
  2. Oil PSUs are also planning to set up 12 Second Generation (2G) Bio-refineries to augment ethanol supply and address environmental issues arising out of burning of agricultural biomass.

National Policy on Biofuels-2018

  1. The policy has the objective of reaching 20% ethanol-blending and 5% biodiesel-blending by the year 2030.
  2. The policy expands the scope of feedstock for ethanol production and has provided for incentives for production of advanced biofuels.

Other initiatives

  1. Recently the Government has increased the price of C-heavy molasses-based ethanol to Rs. 43.70 from Rs. 40.85 to give a boost to EBP Programme.
  2. Price of B-heavy molasses-based ethanol and sugarcane juice-based ethanol has been fixed for the first time at Rs. 47.40.
  3. The Government has reduced GST on ethanol for blending in fuel from 18% to 5%.

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