The Ethanol Blended Petrol (EBP) Programme is a government scheme launched in January 2003 by the Ministry of Petroleum and Natural Gas (MoP&NG). Its origin lies in the need to promote renewable, environmentally friendly fuels and reduce India's heavy dependence on imported crude oil for energy security. The programme aims to substitute imported petrol with domestically produced biofuel, which has already resulted in significant foreign exchange savings.
The mechanism of the EBP Programme involves Oil Marketing Companies (OMCs) procuring ethanol from domestic sources at government-administered prices and blending it with petrol. Initially, the programme targeted a 5% blend, but it has been extended to the whole country, excluding the Union Territories of Andaman Nicobar and Lakshadweep. The EBP Programme is governed by the National Policy on Biofuels, 2018, which provides the overarching framework. This policy expanded the feedstock for ethanol production beyond sugarcane molasses to include damaged food grains, surplus food grains (with approval from the National Biofuel Coordination Committee), sugarcane juice, and starch-containing materials like corn.
The programme has undergone significant changes, notably the advancement of its blending targets. The National Policy on Biofuels, 2018, as amended in 2022, advanced the indicative target of 20% ethanol blending (E20) in petrol from the earlier deadline of 2030 to the Ethanol Supply Year (ESY) 2025-26. This ambitious target is supported by initiatives like the Pradhan Mantri JI-VAN Yojana, which provides Viability Gap Funding for Second Generation (2G) bio-ethanol projects. The blending percentage has increased from just 1.53% in 2014 to over 13% in ESY 2023-24, demonstrating the programme's rapid progress.