Centre Mulls Policy to Enable Affordable E85 Fuel Rollout: Hardeep Puri

The Centre is evaluating a policy framework to support faster and more affordable adoption of E85 fuel, Petroleum and Natural Gas Minister Hardeep Singh Puri has said. Speaking at an event organised by Hero MotoCorp, the minister described the introduction of India’s first flex-fuel motorcycles capable of operating on ethanol blends ranging from E20 to E85 as a significant development in the country’s energy transition.

Puri said E85 fuel is expected to be considerably cheaper than conventional petrol. “We are actively examining a supportive policy for accelerated affordable adoption of E85 fuel,” he was quoted as saying by PTI. 

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Notably, India is the largest manufacturer of two-wheeler vehicles worldwide.

He indicated that even a limited uptake could have a measurable impact on demand. “even if 1 per cent of E85 is adopted in the 2026-27 supply year, 4 crore litre ethanol demand will be generated.” “Then our farmers who are now aanadata, will become urjadaata,” he added.

The policy discussions come alongside proposed amendments by the Ministry of Road Transport and Highways to expand the use of higher ethanol blends and alternative fuels. Draft changes to the Central Motor Vehicles Rules, 1989 seek to enable wider adoption of fuels such as E85 and E100, along with B100 biodiesel and hydrogen-CNG blends, across vehicle categories.

India has already hit 20 per cent ethanol blending in petrol, using feedstock such as sugarcane, corn and rice. The move has been positioned as a way to lower dependence on crude oil imports while reducing emissions.

At the same event, Union Minister for Road Transport and Highways Nitin Gadkari raised concerns over the higher GST rate of 18 per cent on fuels with ethanol blending above 20 per cent, compared to 5 per cent on E20 fuel.

“The finance minister assured me that she will discuss this issue of higher taxes on E30 and above with state governments in the GST Council meeting,” Gadkari said.

He added that diversification of agriculture towards energy production would play a key role going forward, stating that ethanol is a viable fuel option. Gadkari also indicated that the ministry is exploring the use of concrete roads as part of its infrastructure approach.