NEW DELHI: Ongoing conflict in West Asia and concerns over energy supply have prompted the government to explore a faster rollout of flexible fuel vehicles (FFVs), which can run on blended gasoline as well as 100% ethanol.
In a meeting called by the Petroleum Ministry on Saturday, original equipment manufacturers (OEMs) cited the need to address consumer concerns, particularly regarding the need to reduce fuel costs as vehicle kilometers travel when using ethanol, for faster adoption.People familiar with the developments said that since major car and two-wheeler manufacturers have ready-made prototypes of FFV models, the government now needs to create an ecosystem for adoption of these vehicles.
The government asserted that blending 20% ethanol in petrol helped India save imports of about 4.5 crore barrels (700 crore liters) of crude oil annually.
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FFVs are a more viable option than increasing blending of ethanol into gasoline, as higher blending levels will impact the performance of existing vehicles, officials and industry sources said. A person familiar with the discussions said the meeting focused on enabling conditions for rural farmers.
TOI has learned that the industry has sought a clear roadmap on which fuel stations would dispense ethanol, compensating for the loss of mileage, which is 27% to 30% lower than petrol. “The industry has made the point that consumers should not feel cheated when purchasing such vehicles because of low mileage,” said one person who attended the meeting. Last year, Petroleum Minister Hardeep Singh Puri wrote to Foreign Minister Nirmala Sitharaman seeking GST parity between FFVs and EVs.
Currently, the GST for FFVs is 28% compared to 5% for EVs.