Ethanol blending in petrol won’t void your insurance policy, gives better acceleration, doesn’t affect mileage: Govt on E20

The Ministry of Petroleum and Natural Gas has said that 20% ethanol-blended petrol (E20) improves acceleration, lowers carbon emissions, and does not significantly impact mileage. It also dismissed concerns that E20 use could void vehicle insurance, calling such claims “totally baseless” and the result of a misinterpreted social media post.

E20 offers better acceleration

The ministry stated that E20 offers “better acceleration, better ride quality and most importantly, lowered carbon emissions by approximately 30% as compared to E10 fuel.” With a higher octane number of about 108.5 versus petrol’s 84.4, ethanol-blended fuels are suited for modern high-compression engines.

“Vehicles tuned for E20 deliver better acceleration which is a very important factor in city driving conditions,” the statement said. Ethanol’s higher heat of vaporisation also cools the intake manifold, increasing air-fuel mixture density and boosting volumetric efficiency.

Mileage concerns addressed

Claims that E20 causes a “drastic” drop in fuel efficiency are misplaced, the ministry said. Mileage depends on several factors beyond fuel type, including driving habits, regular maintenance, tyre condition, and air conditioning usage. Research by Indian Oil Corporation, the Automotive Research Association of India, and the Society of Indian Automobile Manufacturers shows that any efficiency drop in compatible vehicles is marginal. Some models have been E20-ready since 2009.

Insurance validity unchanged

The ministry rejected suggestions that using E20 fuel could lead to insurance claims being denied. “This fear mongering is totally baseless and has been clarified by an insurance company whose tweet screenshot was deliberately misinterpreted to create fear and confusion. Usage of E20 fuel has no impact of the validity of insurance of vehicles in India,” it said.

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It added that authorised service stations are available to support vehicle owners who believe their vehicles may need tuning or parts replacement for optimum performance.

Broader benefits and future roadmap

Beyond performance, the ethanol blending programme reduces greenhouse gas emissions, cuts crude oil imports, and increases farmer incomes. From 2014-15 to July 2025, blending by public sector oil companies saved over ₹1.44 lakh crore in foreign exchange and avoided about 736 lakh metric tonnes of CO₂ emissions. The government’s current roadmap keeps E20 in place until October 31, 2026. Any move beyond will follow consultation with automakers, ethanol producers, fuel suppliers, and other stakeholders.

Ethanol blending as a transition fuel

The ministry said biofuels and natural gas are “India’s bridge fuels” and part of the country’s commitment to achieve net zero emissions by 2070. A NITI Aayog study found that greenhouse gas emissions from sugarcane-based ethanol are 65% lower than petrol, while maize-based ethanol reduces emissions by 50%.

The programme, according to the ministry, has also supported the rural economy by clearing sugarcane arrears and making maize cultivation more viable. “With the Ethanol blending programme, money which was earlier spent on crude oil imports is now going to our farmers who have become ‘Urjadaatas’ apart from being ‘Annadatas’,” the statement said.

From 2014-15 to July 2025, blending by public sector oil marketing companies saved over ₹1.44 lakh crore in foreign exchange, replaced about 245 lakh metric tonnes of crude oil, and cut CO₂ emissions by about 736 lakh metric tonnes — equivalent to planting 30 crore trees. This year, at 20% blending, farmers are expected to receive around ₹40,000 crore, while forex savings may reach ₹43,000 crore.

Performance and fuel efficiency

Concerns over mileage loss, the ministry said, had been anticipated and studied as early as 2020 by an inter-ministerial committee of NITI Aayog, with research support from IOCL, ARAI, and SIAM. It said E20 offers better acceleration, improved ride quality, and about 30% lower carbon emissions compared to E10.

The ministry highlighted ethanol’s higher octane number of about 108.5 versus petrol’s 84.4, adding that vehicles tuned for E20 “deliver better acceleration which is a very important factor in city driving conditions.” The claim that E20 drastically reduces fuel efficiency was rejected, with officials noting that mileage depends on multiple factors, including driving habits, maintenance, and tyre condition.

Vehicle readiness and global examples

Discussions with the Society of Indian Automobile Manufacturers and major automakers found that some vehicles have been E20-compatible since 2009, making efficiency loss negligible in such cases. The ministry said Brazil runs successfully on E27 fuel “with zero issues,” using the same automakers that sell in India.

E20 meets BIS specifications and automotive industry standards. For older vehicles, some rubber parts and gaskets may need earlier replacement, which the ministry described as inexpensive and manageable during routine servicing.

Pricing and consumer concerns

The ministry said ethanol was cheaper than petrol when a 2020-21 NITI Aayog report was prepared, but procurement prices have since risen. The current average ethanol cost for 2024-25 is ₹71.32 per litre, higher than refined petrol, yet the government continues blending to support energy security, farmers’ incomes, and environmental goals.

It also dismissed claims that E20 affects vehicle insurance validity, calling such fears “totally baseless” and citing a misinterpreted tweet as the source of confusion.

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