Indian oil processors to build seven 2G bioethanol plants

Indian state-run fuel retailers Indian Oil Corp. (IOC), Bharat Petroleum Corp. (BPC), and Hindustan Petroleum Corp. (HPC) will set up around seven second-generation (2G) ethanol plants across the country.

The plants will be set up at a cost of Rs40 billion (€552.7m) and will help enhance ethanol availability for blending with petrol, according to online newspaper Live Mint.

2G ethanol is produced using non-edible agricultural waste left over after harvesting, including corn cobs, rice straw, and wheat straw among others.

Currently, technology is available to convert cellulose into sugar, which can later be fermented to form ethanol. 

“The OMCs are in the process of setting up nearly seven such plants in the initial stage. These will be set up at a cost of Rs6 billion each. The plan is currently under the consideration of the ministry of renewable energy and the ministry of petroleum and natural gas,” said an industry official aware of the talks who spoke to Live Mint on the condition of anonymity.

These plants, the official added, will produce 100,000-150,000 litres of ethanol per day and correspondingly equivalent bio-CNG (compressed natural gas), which is an alternative to diesel. 

To reduce costs, the plants will be built in close proximity to the feedstock supplying-farm and such location are currently being searched for.

In September, IOC tied up with Pune-based Praj Industries to build three 2G bioethanol plants with technology developed by Praj.

The construction plans have been confirmed by a BPC official, who said the company is in talks with “other technology providers” in addition to Praj to set up two more plants.

India is targeting a more than seven-fold expansion in its biofuel market in the next six years, oil minister Dharmendra Pradhan said in August.

In, Union minister Nitin Gadkari said the government was working up a new policy on non-conventional resources as it plans to take up ethanol blending in petrol to 22.5% and in diesel to 15%.

“First-generation ethanol will continue to be the main contributor to the blending programme, besides serving beverage and industrial demand. However, the desired 10% ethanol blending programme calls for alternative feedstocks and hence, the need for 2G cellulosic ethanol technology,” said Pramod Chaudhuri, executive chairman at Praj Industries in his Q2 address to shareholders.