New Delhi, June 11 (IANS). The Government of India has taken an important decision to promote the use of ethanol blended fuel. The central government has announced exemption from central excise duty on petrol with 22 percent, 25 percent, 27 percent and 30 percent ethanol blends (E22, E25, E27 and E30).
According to a notification issued by the Finance Ministry on Thursday, zero excise duty will be applicable on E22, E25, E27 and E30 fuels provided these fuels conform to Bureau of Indian Standards (BIS) specification IS 19850.
It said the exemption has been provided under Section 5A of the Central Excise Act, 1944.
Under the new system, E22 fuel will contain 78 percent petrol and 22 percent ethanol. Similarly, 25 percent ethanol will be mixed in E25, 27 percent in E27 and 30 percent in E30. This exemption will be available only if the necessary tax on petrol has been paid and applicable GST on ethanol used in the blend has been deposited.
This decision of the government has come at a time when recently the standards for ethanol blended petrol up to E30 have been approved. This paves the way for future commercial use of fuels with higher ethanol blends.
This step is considered important in the country moving beyond the E20 program to adopting more ethanol blended fuel.
India has already achieved the target of 20 percent ethanol blending (E20) in petrol ahead of schedule. Now the government is working on the possibility of further increasing the level of ethanol blending, with the aim of reducing dependence on crude oil imports, reducing carbon emissions and promoting the domestic bio-fuel industry.
The ongoing conflict in West Asia and fluctuations in crude oil prices have raised concerns about India’s energy security. There is a danger of global oil supply being affected, especially due to the uncertainties arising in the Strait of Hormuz. In such a situation, increasing ethanol blending is being considered an important option for strengthening energy security for India.
In recent years, there has been a sharp increase in the purchase of ethanol by oil marketing companies. The government has long indicated that ethanol blending levels will be further increased after E20. Although no formal roadmap has been announced yet for E25 or E30, through new standards and tax breaks the government has made it clear that it is serious about moving the country towards higher ethanol blend fuels.
–IANS
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