India now eyes biofuel mix to diesel, heavy construction machines to be first in line

New Delhi: India is preparing to extend its biofuel push to the diesel-guzzling construction equipment sector, with plans to blend biofuels into diesel that powers heavy carriers, cranes, bulldozers, and other large machinery.

Inter-ministerial consultations between the road transport and highways ministry and the heavy industries ministry have been started to operationalize the plan, according to two officials directly aware of the development.

Construction equipment, a sector that alone consumes 3-4% of the country’s annual 91 million tonnes of diesel, could be the first to face mandatory biofuel blending before a nationwide rollout of 10% blended fuel

So far, India has been blending ethanol into petrol, with the country having already achieved 20% blending. Targeting higher fuel-guzzling and more polluting commercial vehicles would eventually help the country fastrack on its goals, as the country’s diesel consumption is more than twice its petrol consumption.

Also Read | Ethanol-blended petrol: A fuel for the future or a faulty policy push?

“The work on biofuel blending in diesel for construction equipment vehicles has started with a discussion between the two ministries,” said one of the officials cited above, requesting anonymity. The initiative aims will help India trim its massive crude oil import bill, the official said. it also aligns with the country’s twin goals of moving towards net-zero emissions and boosting farmer incomes through greater use of crop-based biofuels.

India paid an import bill of $137 billion to ship in 234 million tonnes of crude oil in FY25.

“The construction equipment vehicle industry is currently battling demand woes due to lower priced vehicles coming in from China, but the sector can be a crucial factor in reducing crude oil imports,” said the second official, also on the condition of anonymity.

Email queries sent to both ministries on 28 August remained unanswered.

Union minister for road transport and highways Nitin Gadkari has said on multiple occasions that the 400-crore litres of annual diesel usage by the construction equipment vehicles sector can be an opportunity for biofuel blending to reduce the country’s crude oil imports.

Industry stance on use of green fuels

Industry leaders are willing to accept biofuel blending as a method of reducing emissions and cutting fuel imports.

Deepak Shetty, chief executive officer and managing director of JCB India, a leading construction equipment maker, told Mint the company welcomes this initiative. “We view these developments positively, as they align with our commitment to sustainable innovation and India’s broader goals of reducing pollution, cutting fossil fuel imports, and advancing towards net-zero emissions,” he said.

Construction equipment vehicle makers have earlier invested in battery-powered electric vehicles as well as hydrogen-powered vehicles to decarbonize the sector. While battery-electric power works for compact machines, it is not practical for larger machines in our industry, said Shetty of JCB India.

Also Read | Mint Explainer: Why is India blending more ethanol with petrol?

The Indian Construction Equipment Manufacturers Association (ICEMA) had said in its latest annual report for FY24 that it is working with the Automotive Research Association of India (ARAI) to develop new standards for the production of construction equipment vehicles that would run on alternative fuels such as compressed natural gas, hydrogen, biodiesel, and hybrid fuels.

Biofuels such as methanol, ethanol, and isobutanol are agricultural products, and are, therefore, not dependent on imports. Blending these green fuels into petroleum products to run vehicles can reduce crude oil imports.

Union minister Gadkari had told Mint in an interview on 3 July that blending biofuels into fossil fuels can be an opportunity for India’s farmers to increase their incomes as these fuels are made of agricultural waste and byproducts.

Impact of switch to biofuels

Biofuel blending, while a reputed method of reducing emissions and decreasing import dependence, has also seen controversy.In recent months, there has been a public outcry over a hit to vehicle performance and mileage following the use of E20 fuel, which is a mix of 20% ethanol into petrol.

To be sure, India achieved its ethanol blending targets ahead of time, but the time required by vehicle makers to make fuel systems compliant with the qualities of blended fuels has caused delays in making E20 an industry-wide norm.

Now, vehicle makers have started to address consumer concerns. For instance, Renault India had on 27 August said its older vehicles compliant with 10% ethanol blending would also run smoothly on E20 fuel, citing tests conducted jointly by Indian Oil Corp Ltd and ARAI.

Also Read | India steps up push for ethanol as fuel, automakers seek differential pricing

A joint statement by ARAI, the Federation of Indian Petroleum Industry (FIPI), and the Society of Indian Automobile Manufacturers (SIAM) on 30 August said, “At 20% ethanol blending, it is expected that payment to the farmers in this year alone will be approximately Rs.40,000 crore and forex savings will be around Rs. 43,000 crores. In the last 11 years, since the inception of the ethanol blended petrol programme, foreign exchange of Rs. 1.44 lakh crore has been saved, and 245 lakh metric tonnes of crude oil has been substituted, providing the energy security which is crucial especially considering the current geopolitical world order.”

The statement also said concerns over vehicle mileage loss were “misplaced” as mileage depended on driving habits, maintenance practices, age of vehicle, tyre conditions, usage of AC load, among other factors. It, however, conceded that: “As part of the testing conducted on wide range of older vehicles, a marginal drop in fuel economy was observed.”

On 20 August Mint reported that the government has taken steps to blend isobutanol with diesel, as the ethanol derivative biofuel is less corrosive and has a higher energy density than ethanol. But isobutanol costs more, and has lesser availability than ethanol, experts had told Mint.
 

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