The Hindu Business Line : Ethanol-doped petrol supply plan hits roadblock again in TN

Industry & Economy - Non-conventional Energy
Agri-Biz & Commodities - Sugar
States - Tamil Nadu
Ethanol-doped petrol supply plan hits roadblock again in TN

R. Balaji

Gasohol to be available in Karnataka, AP soon

The numbers
Over 1,428 lakh litres of alcohol are forecast for the sugar season
Liquor manufacturers' ethanol requirement pegged at 1,285 lakh litres.

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Chennai Jan. 21 Supply of ethanol-doped petrol, gasohol, has once again hit a roadblock in Tamil Nadu with the State Government having second thoughts on the availability of ethanol to meet demands of both liquor manufacturers and oil companies, according to industry sources.

Meanwhile, sources in the know said, gasohol supplies are expected to start in a fortnight's time in Karnataka and parts of Andhra Pradesh, where the suppliers have been identified.

In Tamil Nadu, gasohol is not likely to be available at least up to March when the State Government is likely to review the situation. But an earlier review cannot be ruled out, sources said.

Industry sources pointed out that even as the Centre has expressed intention of hiking ethanol content in petrol to 10 per cent from the present level of 5 per cent, supplies are yet to stabilise in the State.

The programme has been implemented only in fits and starts.

The sugar mills, which have distilleries to produce ethanol have represented to the Government on the sufficient availability of raw material molasses during the 2006-07 season.

In November 2006, the distilleries and oil companies agreed on a price of Rs 21.50 a litre of ethanol and finalised a deal to supply ethanol for three years. At the time, the State Government was for expanding gasohol supplies throughout the State. The contract between oil companies and sugar mills provided for a total supply of over 5.8 crore litres ethanol a year.

However, according to sources, during the last monsoons there had been a drop in production at the distilleries. They cut back on production during the rains to ensure the effluent treatment systems were not overloaded. This is an annual feature, which had affected availability of alcohol.

Now the distilleries are back on full production, they said.

According to estimates by the industry, during the 2006-07 sugar season, the distilleries are expected to produce about 1,386 lakh litres of alcohol and the opening stock is estimated at 42 lakh litres. Over 1,428 lakh litres of alcohol are forecast for the season with liquor manufacturers' ethanol requirement pegged at 1,285 lakh litres. There is a surplus of about 43 lakh litres, they said, ruling out any possibility of alcohol deficit.

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