Amid E20 backlash, Centre opens talks on parallel sales of E10 fuel: Report

Amid a raging controversy over E20 fuel, the Centre has initiated “early exploratory discussions" with the industry on the feasibility of retailing E10 petrol, which contains 10 per cent ethanol, alongside E20 petrol, Indian Express reported, quoting sources privy to the development.

The development comes in the backdrop of a massive pushback against the Centre's introduction of E20 petrol, with consumers alleging that it results in a significant drop in mileage and engine damage, especially in older vehicles -- claims which the Centre has consistently denied.

Chief Economic Adviser V Anantha Nageswaran recently called for a parallel sale of E10 and E20 fuel. He was the first voice from the government's side to have made the suggestion.

‘Preliminary discussions’

According to the IE report, the said discussions are “preliminary” and are being made “keeping the older vehicles in mind”. It further stated that the talks in this regard are being held on various technical and non-technical aspects of India’s complex fuel retail supply chain, adding that no final decision has been reached so far.

Also Read: Chief Economic Advisor calls for E10 fuel option for older vehicles, E20 for newer ones

As for the reason behind such a discussion, the report stated that the criticism regarding E20’s alleged adverse effects on older vehicles, especially two-wheelers, suitable for E10 petrol, played a key role in the initiation of the talks.

Older vehicles drive E10 talks

Elaborating further, the report, quoting auto industry insiders, pointed out that petrol vehicles which were manufactured and sold after April 2023 are considered fully E20-compliant as they were mandated as per the Bharat Stage 6 (BS6) phase two emission norms. This means that vehicles currently being sold by manufacturers are E20-compatible, but those sold before 2023 are not.

Also Read: Automakers flagged E20 fuel contamination concerns for years: Tahseen Poonawalla

However, an oil industry official stated that the task of making two base petrol variants available in the retail market would run into several difficulties.

“It will be like introducing a new petrol variant altogether, that too in large volumes. Apart from the base fuel (E20), we do have two-three premium petrol variants, but their consumption is minuscule compared to the base petrol, so it is not too complicated to offer some volumes of such fuels along with E20. But if E10 is to be retailed in large volumes, it will require building an almost parallel supply chain as the existing one has shifted entirely to E20,” said the industry official quoted in the IE report.

Centre had rejected multiple grades

However, the Ministry of Petroleum and Natural Gas (MoPNG) had earlier rejected the proposal for multiple base petrol variants at fuel stations in a detailed FAQ note released on July 10. The ministry reportedly maintained the same position during the Monsoon Session of Parliament while replying to questions raised by MPs.

Also Read: E20 fuel cuts emissions but trims mileage by 2-6 pc, Gadkari tells Lok Sabha

The government questioned the need for offering different grades when a cleaner fuel is already available.

The ministry also argued that stocking pure petrol, E10 and E20 together would place added pressure on the existing distribution system. India has over 1 lakh retail outlets, along with refineries, terminals, depots and pipelines.

E20 faces mileage concerns

India reached the 20 per cent ethanol blending target last year, five years before the original deadline. The move has faced opposition over alleged mileage losses and possible wear in older vehicles.

The Centre has said mileage loss in older vehicles would be limited to 3-5 per cent. It has also rejected claims that E20 can damage engine components.