EoI process for long-term ethanol supply to OMCs receives overwhelming response

• 197 bidders have submitted EoIs for supplying ethanol to OMCs for long term
• Ethanol procurement target for the ongoing year ESY 2020-21 is 325 crore litre which will take ethanol blending to 8.5 percent

New Delhi: The first Expression of Interest (EoI) for signing long-term agreement with upcoming dedicated ethanol plants for supply of ethanol has received an overwhelming response, with 197 bidders participating in the process, said the Ministry of Petroleum and Natural Gas in an official statement on Saturday. The EoI was published by Bharat Petroleum Corporation Ltd (BPCL) on behalf of Oil Marketing Companies (OMCs) under the guidance of the Petroleum Ministry on August 27 which opened on September 17. The bids are currently under evaluation.

Tender will give a boost to ethanol production: Puri

Thanking all the bidders for making the EoI submission process successful and wishing them all the very best in their ventures, Union Minister for Petroleum and Natural Gas Hardeep Singh Puri said that the tender is a proactive step taken by the ministry and oil companies to motivate project proponents to set up ethanol production plants in ethanol deficit states, thereby paving the way forward for the nation to achieve the ethanol blending target of 20 percent and more in the coming years.

Backdrop

Around 173 crore litre ethanol was procured last year and 5 percent ethanol blending was achieved during ESY 2019-20. The target for the ongoing year ESY 2020-21 is 325 crore litre which will take the blending to 8.5 percent. The actual achievement during ESY 2020-21 so far has been 243 crore litre, accounting for 8.01 percent blending.

GST and transportation charges are being paid extra. Other incentives being provided for ethanol production are — long term visibility/off take assurance, interest subvention scheme for capacity addition, differential remunerative price of ethanol, relaxed EoI conditions/reduced bank guarantee requirements and penalty for non-supply, and procurement priority within state boundary limits.

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