Govt. defends E20, says fuel economy may fall
The Union government said E20 ethanol-blended petrol can cost more than petrol at current crude prices, while arguing that the blending programme has reduced exposure to oil-price volatility.
AI generated- E20 is petrol blended with 20% ethanol and is part of India’s transport-fuel transition.
- The Union government said E20 may be costlier than petrol when international crude is around $70 per barrel.
- The Union government said ethanol can become relatively cheaper when crude rises to about $120–130 per barrel.
- The government cited a maize-based ethanol procurement price of about ₹71.86 per litre before GST and logistics/depot costs.
The Union government defended E20 ethanol-blended fuel and said its economics depend on the level of international crude oil prices. The explanation matters for UPSC because it links energy security, farm income support, and the pricing of transport fuel.
The government’s main claim is that ethanol is procured at remunerative prices to compensate Indian farmers, but the resulting fuel may not always be cheaper than petrol when crude prices are low.
What the government said
UPSC can ask how ethanol blending supports energy security, farm incomes, and import substitution, while also testing the trade-off between environmental goals, vehicle compatibility, and consumer costs when crude prices are low.
