Ethanol blend fuel: E20 trims mileage slightly but boosts farmers, forex savings and green gains

The use of 20 per cent ethanol-blended petrol (E20) in vehicles could result in a minor decline of 2-4 per cent in fuel efficiency, but the overall benefits to the nation far outweigh the marginal extra fuel cost for consumers, industry officials and the Automotive Research Association of India (ARAI) said on Saturday.Auto industry body Society of Indian Automobile Manufacturers (SIAM) maintained that concerns over fuel-related warranty or insurance claims are “misplaced,” with manufacturers committed to honouring warranties “without any ifs and buts.”“The mileage-related challenges, there is admittance, clearly, that due to the intrinsic nature of the fuel there is marginal drop, but it accrues the huge benefit to the nation, to the society, to the farmer, to the environment, to the exchequer and all of us,” SIAM Executive Director P K Banerjee said, PTI quoted.Banerjee rejected consumer claims that efficiency had fallen by as much as 20-50 per cent, calling it a “misplaced misinformation campaign.” Tests showed a 2-4 per cent mileage drop depending on vehicle type, he said, adding that E20 has around 6 per cent less energy due to ethanol’s calorific value being 30-35 per cent lower than petrol.On engine impact, Banerjee noted that “millions of vehicles are running and plying E20 for quite some time now, not a single vehicle breakdown has been reported.”

ARAI Director Reji Mathai backed the assessment, citing studies from 2016 and 2021 that found no adverse impact from the blended fuel.Highlighting the broader economic benefits, Federation of Indian Petroleum Industry (FIPI) advisor P S Ravi said ethanol procurement worth Rs 40,000 crore had already been paid to farmers in 2025, driving rural prosperity. Since 2014-15, ethanol blending has substituted 245 LMT of crude oil, saved Rs 1.44 lakh crore in forex, and cut 763 LMT of carbon dioxide emissions.Toyota Kirloskar Motor’s Country Head and Executive Vice President, Corporate Affairs, Vikram Gulati said ethanol blending reduces crude imports and forex outgo, while funnelling money directly to farmers. “The money that would have been sent outside (for importing crude) is now going to farmers, who will now be economically better. They will be able to spend more and they will contribute to the economy,” he said.Gulati added that ethanol is enabling India’s “smooth transition” to sustainability without disrupting the economy, while strengthening self-reliance in energy, technology and raw materials.