E85, a blend of 85% ethanol and 15% gasoline, also requires flex-fuel vehicles. (Amnesty International image)
Even as the country debates the impact of E20 gasoline on cars and mileage, oil marketing companies (OMCs) are reluctant to undertake a large-scale rollout of E85 fuel. This comes on the back of previous experience with the E100 failing to generate demand.At the same time, the government is understood to be considering a slower rollout of E25 fuel amid concerns that high ethanol blends could affect engines in existing vehicles. Cars manufactured between 2012 and March 2023 are designed to run on fuel containing up to 10% ethanol, while vehicles produced before April 2025 are not fully compatible with E20 blends either.
What are E100 and E85 fuels?
E100 consists entirely of ethanol and can only be used in vehicles equipped with flex-fuel engines.
E85, a blend of 85% ethanol and 15% gasoline, also requires flex-fuel vehicles. The limited availability of such vehicles has become the biggest obstacle to wider adoption of both fuels.With nearly 400 pilot E100 retail outlets recording almost no sales, OMCs want to significantly increase the number of flex-fuel vehicles on Indian roads before supporting the government’s plan to expand ethanol-based fuel as a way to reduce dependence on crude imports and reduce fossil fuel consumption, industry executives said in an ET report.
What is ethanol blended gasoline?
“We launched E100 on a trial basis at nearly 400 filling stations, but the demand was almost non-existent. As a result, we reduced the network to just five or six outlets because there were hardly any customers. Although the government has been encouraging us to expand, we prefer to wait and evaluate how the transformation develops,” a senior Indian Oil Corporation official was quoted as saying.“Although automakers are beginning to offer flex-fuel vehicles, current demand remains well below the level needed to justify significant expansion of fuel distribution infrastructure.
“Until sales of these vehicles gain significant momentum, setting up additional E85 retail outlets would be premature,” the official said.Last month, Road Transport and Highways Minister Nitin Gadkari approved regulations allowing the use of E100 fuel. Under the proposed roadmap, the government aims to set up about 500 flex-fuel stations by December and expand the network to nearly 5,000 outlets across major cities by the end of 2027.
However, implementation has been slow, as there are only about 48 gas stations nationwide that currently dispense E85 and demand remains limited.
Pricing issues
Oil marketing companies attribute the weak response largely to the narrow price gap between E85 gasoline and conventional gasoline. In Delhi, E85 is priced at Rs 82.12 per litre, compared to Rs 102.12 per liter for petrol. According to a report by the Council on Energy, Environment and Water (CEEW), gasoline is currently 2-14% cheaper than E100.
The report also noted that ethanol has a lower energy content than gasoline, which means vehicles need more fuel to travel the same distance. As a result, the actual operating cost of ethanol is estimated to be 15-25% higher than that of gasoline.The report concluded that ethanol would need to cost between Rs 52 and Rs 63 per liter to become more economical than petrol. This level is well below the cost of producing any commercially viable raw material evaluated.
Until prices become more competitive, fuel retailers are unlikely to aggressively promote ethanol-based fuel, the report said.
E20 gasoline problems
Meanwhile, Petroleum and Natural Gas Minister Hardeep Singh Puri on Monday dismissed reports suggesting that consumers are facing problems with E20 fuel, terming the claims a “misrepresentation”.
Challenges of gasoline blended with ethanol
He said any decision to move to a higher blend of E25 ethanol would not be made until detailed testing was completed and the results were reviewed with car manufacturers.Responding to the controversy over 20% ethanol blended petrol, Puri said the fuel is widely accepted by automobile manufacturers and consumers. “Car manufacturers and those who maintain these vehicles have consistently said there are no problems. I don’t understand why this controversy has suddenly arisen,” he said, adding that the concerns raised are a misrepresentation.The minister also said that the rollout of E85 fuel is still at an early stage. According to him, expanding its availability will take time because it requires the development of new retail infrastructure, including gas stations capable of distributing this mixture.
