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The government on Tuesday termed claims that using E20 petrol—80 parts petrol and 20 parts ethanol—leads to a “drastic” reduction in fuel efficiency in older vehicles as “misplaced”, adding that studies conducted by organisations including the country’s top automobile industry association show that efficiency drop is only marginal, while the blended fuel offers various advantages. It also assured vehicle owners that any decision on scaling up ethanol blending in petrol beyond the current 20 per cent will be a considered decision based on detailed consultations between various stakeholders including vehicle manufacturers, entities involved in supply of feed stock, research and development (R&D) agencies, oil companies, and ethanol producers.
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“The critiques suggesting that E20 causes a ‘drastic’ reduction in fuel efficiency are misplaced. Vehicle mileage is influenced by a variety of factors beyond just fuel type. These include driving habits, maintenance practices such as oil changes and air filter cleanliness, tyre pressure and alignment, and even air conditioning load. Extensive discussions have been carried out with the Society of Indian Automobile Manufacturers (SIAM) as well as prominent manufacturers of vehicles. The efficiency drop (if any) in E10 (fuel with 90 per cent petrol and 10 per cent ethanol) vehicles has been marginal. For some manufacturers, vehicles have been E20 compatible from as far back as 2009. The question of any drop in fuel efficiency in such vehicles does not arise,” the Ministry of Petroleum and Natural Gas said in a detailed release on Tuesday.
The release is the second statement from the MoPNG this month over concerns among vehicle owners about possible risks that ethanol-blended petrol could pose to engines, with apprehensions that in older cars, using blended fuel could negatively impact fuel economy and shorten the engine’s lifespan. The MoPNG said that the concerns related to performance and mileage being raised now were anticipated “as early as 2020” and an inter-ministerial committee (IMC) of the NITI Aayog had examined them at length, finding no major cause of concern. “This also was backed by research studies carried out by IOCL (Indian Oil Corporation), ARAI (Automotive Research Association of India) and SIAM,” it said.
While newer vehicles, particularly those sold since 2023, are understood to be E20 compatible, engines of many vehicles made before that have not been specifically tuned for such blended fuel, leading to apprehensions that such vehicles could be at a disadvantage in the long-term. An auto industry executive said that corrosion in the engine is of particular concern, which could be even more pronounced in the case of two-wheelers. The executive also explained that the calorific value of ethanol blended fuel is higher than gasoline, which means that more fuel is burnt for similar performance, which brings down the fuel economy of the vehicle. These worries have led to several consumers questioning its impact on the longevity of their vehicles, in addition to concerns about mileage.
According to the government, the impact on older vehicles would be limited to some rubber parts and gaskets requiring replacement earlier than usual, which is inexpensive and can be done during routine servicing.
“…safety standards for E20 are well established through BIS (Bureau of Indian Standards) specifications and Automotive Industry Standards. In most parameters including drivability, startability, metal compatibility, plastic compatibility, there are no issues. Only in case of certain older vehicles, some rubber parts and gaskets may require replacement earlier than in case non-blended fuel was used. This replacement is inexpensive and can be easily managed during routine servicing. It may need to be done once in the lifetime of vehicle and is a simple process to be carried out at any authorized workshop,” it added.
India achieved 20 per cent ethanol blending just last month, five years ahead of the original target. The 20 per cent blending aim had earlier been advanced from 2030 to 2025-26, given the success the country tasted in achieving 10 per cent blending levels ahead of schedule. According to the government, the E20 fuel presents significant advantages for modern engines.
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“The use of E20 gives better acceleration, better ride quality and most importantly, lowered carbon emissions by approximately 30% as compared to E10 fuel. Ethanol’s higher-octane number (around 108.5 compared to petrol’s 84.4) makes Ethanol-blended fuels a valuable alternative for higher-octane requirements that is crucial for modern high-compression engines. Vehicles tuned for E20 deliver better acceleration which is a very important factor in city driving conditions. Additionally, Ethanol’s higher heat of vaporization reduces intake manifold temperatures, increasing air-fuel mixture density and boosting volumetric efficiency,” the MoPNG said.
“Previously Petrol was being sold in India with a research octane number (RON) of 88. Today, regular petrol in India has a RON of 91 to meet the requirements of BS-VI, which aims to reduce harmful emissions. However, this has again been improved further to RON 95 with blending of Ethanol 20, resulting in better anti knocking properties and performance,” it added.
According to the MoPNG, Brazil has been successfully running on E27 fuel for years without any issue, and automakers like Toyota, Honda, and Hyundai, which manufacture and sell vehicles in India, do so in Brazil as well, which means that tested and proven vehicle technology is available with original equipment manufacturers for use of ethanol-blended petrol.
It is worth noting that flexible fuel cars, or flex fuel cars, have been running in Brazil for decades now, allowing Brazilians the choice of different ethanol blend levels at different price points. In India, however, flex fuel vehicles are still extremely rare and currently there is no option for the consumer to choose the ethanol blend level. The Indian government has been pushing automakers to offer flex fuel vehicles, but the segment is yet to take off in the country.
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“There continue to be apprehensions on whether the country will go beyond E20 very rapidly. Any move beyond E20 requires careful calibration, for which extensive consultations are underway…This process is yet to reach conclusion. In the meanwhile, the current roadmap commits Government to E20 upto 31.10.2026. Decisions for beyond 31.10.2026 will involve submission of the Report of the Inter Ministerial Committee, evaluation of its recommendations, stakeholder consultations and a considered decision of Government in this regard. That decision is yet to be taken,” the MoPNG added. There had been some indications earlier that a blending level of around 27 per cent could be the next target in the ethanol-blending programme.
‘Ethanol not cheaper than petrol’
On the argument that ethanol-blended petrol should be cheaper than unblended petrol, the government clarified that while ethanol used to be cheaper than petrol till a few years ago, that is no more the case. Over time, the procurement price of ethanol has increased significantly, leading to the weighted average price of the biofuel exceeding the pre-tax price of refined petrol. The price of petrol at the fuel retail stations is significantly higher than its refinery gate price due to high incidence of central and state levies on the fuel.
“Currently, the average procurement cost of Ethanol for Ethanol Supply Year 2024-25, as on 31.07.2025, is Rs.71.32 per litre, inclusive of transportation and GST…Price of C-heavy molasses based Ethanol increased from Rs.46.66 (ESY 2021-22) to Rs.57.97 (ESY 2024-25). Price of Maize-based Ethanol increased from Rs.52.92 to Rs.71.86 over the same period. Despite the increase in price of ethanol in comparison to petrol, the oil companies have not gone back on the ethanol blending mandate because the programme delivers on energy security, boosts farmers’ incomes and environmental sustainability,” the MoPNG said.
According to information provided by the country’s largest refiner and fuel retailer IOCL, the base price of petrol as of August 1 was Rs 52.83 per litre, while the fuel’s retail price in Delhi is Rs 94.77, which is inclusive of central excise, value added tax, and dealer commission.
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