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Informist, Wednesday, Nov. 27, 2024

 

By Pallavi Singhal

 

NEW DELHI – India's ambitious plans to produce second-generation ethanol are in limbo as its first 2G ethanol plant at Panipat, built by Indian Oil Corp. Ltd. at a cost of over INR 9 billion, lies dormant, according to multiple sources from the government and the petroleum refining company.

 

The plant in Haryana was inaugurated by Prime Minister Narendra Modi in August 2022 amid much fanfare and was expected to produce around 30 million litres of ethanol every year using 200,000 tonnes of rice stubble. Haryana is likely to generate about 8.10 million tonnes of rice straw this year. However, despite several attempts, the plant has been unable to contribute to the country's ethanol programme.

 

Second-generation ethanol differs from first-generation in terms of feedstock used and, consequently, the production process. Second-generation ethanol is produced using non-edible residues of crops, such as rice and wheat straw, cane trash, cotton stalk and bagasse, whereas first-generation ethanol is made using materials containing sugar such as sugar cane juice, molasses, and sugar beet or materials containing starch such as corn, cassava, potatoes, and damaged food grain.

 

"The 2G plan has not worked for us. There has been zero contribution from the plant to the country's ethanol programme. The plant is barely even functioning. Other similar projects have also been stalled seeing the viability of this one," a senior official from the petroleum ministry said, requesting anonymity.

 

The Union Cabinet in August modified the Pradhan Mantri JaivIndhan-Vatavaran Anukool Fasal Awashesh Nivaran--JI-VAN--Yojana to extend the timeline to implement the scheme by five years till 2028-29 (Apr-Mar). The JI-VAN scheme, notified in March 2019, aims to boost the domestic 2G ethanol capacity by providing financial assistance to 2G bio-ethanol projects. The Panipat plant was set up under the scheme.

 

The government said in a statement in August that other commercial 2G projects being set up by Bharat Petroleum Corp. Ltd., Hindustan Petroleum Corp. Ltd., and Numaligarh Refinery Ltd. at Bargarh in Odisha, Bathinda in Punjab, and Numaligarh in Assam, respectively, are "nearing completion". According to the petroleum ministry, public sector oil marketing companies are in the process of setting up 12 2G bio-refineries at an investment of INR 140 billion. However, government sources said the work on these plants has been paused due to the failure of the first plant. The ministry has not given details about the capacity of these plants.

 

The government’s Petroleum Planning & Analysis Cell makes no mention of how much 2G ethanol is contributing to the country's overall ethanol production.

 

According to a senior Indian Oil Corp. official, the Panipat plant has been plagued with problems since inception and has been producing "either very low or nil quantities of ethanol". "The technology used is not correct, there are issues with the procurement of raw material (paddy stubble), and the cost feasibility is very low," the official said on condition of anonymity.

 

The problems at the plant range from the installation of hammer mills--which are now being replaced with shredders--and a build-up of dust on condensers that has disrupted the cooling process, another senior IOC official said, asking not to be named.

 

According to G.K. Sood, an agriculture expert, using a hammer mill on rice straw is ineffective. "It needs to be shredded, not hammered. Hammer mills are suitable for seeds, but not for rice straw." Further, the build-up of dust on condensers makes the process inefficient. "Condensers are engineered for efficient heat transfer, but the volatile nature of ethanol vapour creates a challenge. If not properly managed, the vapour may escape condensation and be lost, compromising the process. When dust settles on condensers, condensation becomes inefficient, and heat transfer is hindered," Sood said.

 

Moreover, securing rice stubble, or parali as it is known locally, has been another major obstacle in running the plant. A petroleum ministry official said farmers prefer burning stubble to chopping it and providing it to the plant as the profit is "very low". The amount of money spent on getting farm labourers and transportation makes remuneration low, the official said.

 

The success of 2G ethanol plants like the one at Panipat is crucial for India's energy security, as the government has embarked on an ambitious plan to increase the blending of ethanol with petrol. The government is targeting a 20% ethanol blending in petrol by 2030 to reduce dependence on imported crude oil. This target is being reviewed and is likely to be advanced to 2025 based on the good progress so far. The blending rate reached 15.9% in September, outpacing the cumulative average of 13.8% from November 2023 to September 2024. The use of advanced biofuels for producing second-generation ethanol was expected to provide a thrust to achieve this target.

 

The government has not given a clear target of how much it expects second-generation ethanol to contribute to total ethanol production or the blending target. The 20% blending target will be met without practically any contribution from second-generation ethanol. However, any further increase in blending will be easier to achieve if second-generation ethanol production takes off. The failure to use secondary feedstock for ethanol production has meant the country has to rely on producing ethanol by using major foodgrains such as rice and maize, cane juice, and their by-products. The National Policy on Biofuels, adopted in 2018, aimed to prioritise second-generation feedstocks to reduce emissions without distorting the food markets. However, the country continues to allocate large quantities of these essential commodities for producing ethanol.

 

Ethanol production during the current supply year (Nov-Oct) will come from grain-based and sugar-based distilleries. Of the 8.37 billion litres of ethanol to be supplied to oil marketing companies in 2024-25, 62.7% will be sourced from grains and 37.3% from sugarcane.

 

The use of grains for ethanol production has put pressure on several commodities. In August 2023, the supply of rice from Food Corp. of India for ethanol production was put on hold due to a low production outlook. In December last year, the government restricted the use of sugarcane juice and its by-products for ethanol production due to low sugarcane production. Oil marketing companies then increased the price of ethanol from maize, resulting in greater use of maize as a feedstock for ethanol. In 2024, India became a net importer of maize for the first time in decades. According to trade estimates, India imported over 900,000 tonnes of corn during Dec-Sept.

 

According to Dilip Patil, co-chairperson of the Indian Federation of Green Energy’s Sugar Bioenergy Forum, the future of 2G ethanol in India is "uncertain" due to challenges such as high cost of capital, technical hurdles, limited availability of suitable feedstock, and lack of sufficient policy support from the government in the form of incentives and infrastructure.

"While there is potential for significant growth, overcoming these challenges will require concerted efforts from both the government and the private sector. Technological advancements, increased investment, and effective policy implementation will be crucial for realising the full potential of 2G ethanol as a sustainable fuel source," Patil said.  End

 

Edited by Saji George Titus

 

 

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