Indian Fuel Stations May Soon Offer Multiple Ethanol Blends

The government has advised six major fuel retailers - IOC, BPCL, HPCL, Jio-bp Mobility, Nayara Energy and Shell to begin preparing infrastructure for E20, E22, E25 and E30 petrol variants at pumps. The move follows new Bureau of Indian Standards norms for these blends and the government's April 2026 proposal to allow fully ethanol-powered vehicles.

In practical terms, motorists may eventually be able to choose an ethanol blend based on thier car's compatibility. Each variant will be labelled on the dispenser, and prices are expected to vary across blends.

The rollout will require investments in dispensing infrastructure, storage systems, blending controls and fuel-quality monitoring. However, the change is less disruptive than it sounds, as existing dispensers already carry separate nozzles for diesel, premium petrol and E20.

Moreover, the underground storage tanks, which hold around 15,000 litres, already have internal divisions for different fuel grades.

Also, oil companies are expected to bear the cost of expanding these, not dealers. Dispensers will need replacement, but they carry a 10-15 year service life.

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The push is partly driven by a crude supply crunch linked to the West Asia conflict and the partial closure of the Strait of Hormuz, through which 20% of global oil passes.

India imported $123.1 billion worth of crude in FY26, and policymakers are keen to reduce dependence on imported fuel.

Meanwhile, the ethanol blending programme has already saved ₹1.7 trillion and cut 87 million tonnes of carbon emissions since 2014: a reduction equivalent to planting about 350 million trees.

There is also a supply-side reason: India currently produces 20 billion litres of ethanol annually against a blending demand of only 11 billion litres, leaving nearly half the capacity sitting idle.

Source: Livemint
Image Source: AI-generated illustration