The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi, has approved the mechanism for revision of ethanol price for supply to Public Sector Oil Marketing Companies (OMCs) to carry out the Ethanol Blended Petrol (EBP) Programme in the following manner:

• For the next sugar season 2016-17 during ethanol supply period from 1st December 2016 to 30th November 2017, the administered price of ethanol for the EBP Programme will be Rs.39/- per liter.
• Additionally, charges will be paid to the ethanol suppliers as per actuals in case of Excise Duty and VAT/GST and transportation charges as decided by OMCs. 
• If the need arises to increase/reduce the retail selling price of Petrol by Public Sector OMCs, then such increase/reduction would proportionately factor in the requirement of maintaining the fixed cost of purchase of ethanol during the ethanol supply year.
• The prices of ethanol will be reviewed and suitably revised by Government at any time during the ethanol supply period that is from 1st December 2016 to 30th November 2017 depending upon the prevailing economic situation and other relevant factors.
• The revision in ethanol prices will facilitate the continued policy of the Government in providing price stability and remunerative prices for ethanol suppliers.

Do you know?

• Ethanol Blended Petrol (EBP) Programme was launched by the Government in 2003 which has been extended to the Notified 21 States and 4 Union Territories to promote the use of alternative and environment-friendly fuels.
• This intervention also sought to reduce import dependency for energy requirements.
• However, since 2006, OMCs were not able to receive offers for the required quantity of ethanol against the tenders floated by them due to various constraints like State Specific issues, Supplier related issues including Pricing issues of ethanol.