The Government of India has announced a central excise duty exemption for petrol blended with 22 percent, 25 percent, 27 percent and 30 percent ethanol, commonly referred to as E22, E25, E27 and E30 fuels. The move comes after the Bureau of Indian Standards (BIS) finalised specifications for these fuel blends in May, paving the way for their future introduction in the market.
While these higher ethanol blends are not yet available at retail fuel outlets, the tax exemption is expected to improve their commercial viability once production and distribution networks are established. The measure could potentially allow oil marketing companies to offer these fuels at prices lower than current E20 petrol, although official pricing details have not been announced.
India currently uses E20 petrol as the standard ethanol-blended fuel. The government’s latest step is part of its broader strategy to increase the use of domestically produced biofuels, reduce dependence on imported crude oil and support the agricultural sector through greater ethanol demand.
The announcement follows the recent introduction of E85 fuel, which contains 85 percent ethanol and 15 percent petrol. E85 is currently being rolled out in select regions and is priced significantly lower than E20 fuel. Authorities are targeting an expansion of E85 dispensing infrastructure, with plans to establish hundreds of fuel stations by the end of the year.
However, the use of higher ethanol blends requires vehicles specifically engineered for such fuels. While most modern petrol vehicles sold in India are compatible with E20, they are not designed to operate on E85 or other high-ethanol blends. Vehicles intended for these fuels require modifications to engine calibration, fuel delivery systems and materials used in fuel-related components to ensure long-term reliability and durability.
Automakers have already started preparing for this transition. Recently, Maruti Suzuki showcased the production-ready Wagon R Flex Fuel, which is capable of operating on significantly higher ethanol concentrations than standard petrol vehicles.
Alongside petrol blending initiatives, policymakers are also evaluating alternative biofuel pathways. One such proposal involves blending isobutanol with diesel after earlier ethanol-diesel blending trials delivered limited success.
As India continues to push towards greater biofuel adoption, the success of higher ethanol blends will depend on vehicle compatibility, fuel infrastructure development and consumer acceptance.