Media reports suggest that the union petroleum ministry may float fresh tender to procure ethanol from domestic sugar mills (for blending it with petrol).
The ministry decided to float a fresh tender because the earlier tender, which invited global suppliers, could not be successful as the bidders were demanding exorbitant rates for the biofuel.
It may be recalled that India needs 105 crore litre of ethanol per year for blending it with petrol, under the ethanol blended petrol (EBP) programme. Of this requirement, the domestic sugar industry committed 55 crore litre while the rest was supposed to come through imports.
However, with the earlier global tender inviting bidders to supply 80 crore litre of ethanol becoming unsuccessful, the ministry may float another tender, this time seeking bids from local companies, reports indicate.
The ministry rejected the exorbitant bids of global suppliers considering that this would raise the price of blended petrol significantly in the local market.
Earlier, domestic sugar mills asserted that a larger amount must be procured from them in order to balance the final cost of petrol. The sugar industry has calculated an annual saving of Rs 6 per litre annually for state run oil companies if they procure 53 percent of their requirements from domestic sugar mills.
Leave a Reply
You must be logged in to post a comment.