In a move to increase the country’s adoption of biofuels, the government has waived the central excise fee on petrol blended with a higher percentage of ethanol (22 per cent to 30 per cent).
In other words, central excise duties would not apply to petrol combined with ethanol at 22 per cent, 25 per cent, 27 per cent or 30 per cent.
Fuel specifications for the blends were announced by the Bureau of Indian specifications (BIS) on May 19 of this year. They are not currently offered for sale.
BIS wrote on its social media handle, “Following the achievement of 20 percent ethanol blending under the EBP Programme, the new standard aims to promote cleaner transportation, enhance energy security, reduce crude oil imports, and support the agriculture sector.”
The gazette announcement follows India’s official June 5 debut of the E85 variant of petrol, which is 85 petrol ethanol mixed with 15 percent petrol. The E85 is roughly Rs 20 per litre less expensive than the ordinary E20 petrol variant.
What has actually changed?
Four other kinds of ethanol-blended fuel have been added by the government to the basic framework for excise exemptions:
E22: 22 per cent ethanol and 78 per cent petrol
E25: 25 per cent ethanol and 75 per cent petrol
E27: 27 per cent ethanol and 73 per cent petrol
E30: 30 per cent ethanol and 70 per cent petrol
If all four fuel grades meet Bureau of Indian Standards (BIS) specification IS 19850 and the necessary petrol and ethanol taxes have already been paid, they will all be subject to a zero-excise duty rate.
How consumers will be impacted
The immediate impact might be minimal for the majority of car owners. Only cars specifically built, tested, and certified for fuels containing more than 20 percent ethanol are permitted to use higher ethanol mixes, such as E22, E25, E27, and E30.
Passenger cars, three-wheelers, and specific types of commercial vehicles are covered by the approval system under Automotive Industry Standard (AIS) 171.
This means that higher ethanol blends can be used in qualified passenger cars, utility vehicles, three-wheelers, and some commercial vehicles as long as the manufacturers have certified and built them for such fuels.
Nowadays, the majority of petrol-powered cars on Indian roads are built for blends up to E20. Higher ethanol percentages may have an impact on warranty coverage, fuel system components, and engine performance in vehicles that are not authorized for them.
