Concern about potential global warming effects from major greenhouse gases (GHGs) has made it imperative that sources and mitigating options to reduce anthropogenic GHG emissions worldwide are immediately identified. Increased use of petroleum-based fuels in the transport sector has been a major concern as this has been responsible for the large quantity of GHGs emitted into the atmosphere. More than 50% of petroleum products are consumed by the transport sector, gasoline and diesel being the dominating automobile fuels in all types of vehicles. The most harmful constituents of vehicular emissions are carbon monoxide, hydrocarbons, nitrogen oxides, sulfur dioxide, benzene and lead. Broadly, the first three are dependent on engine design while the latter three are dependent on the quality of fuel used. Over the years, consumption of these petroleum-based fuels has been increasing with the increase in the number of vehicles, consequently leading to higher levels of pollution in cities. Efforts have been made to reduce vehicular pollution by improving, on the one hand, vehicle technology and the characteristics of petroleum-based fuels, and on the other, by using alternative cleaner fuels. At the same time the establishment of emission standards and regulatory measures have forced the sector to search for solutions.

Improvement in vehicle technology and better fuel quality have somehow contributed to reducing pollution; but the total impact in the sector has not been impressive. Introducing unleaded gasoline was one pioneering effort at introducing a cleaner fuel option. The quality of gasoline and diesel fuels (vis-à-vis octane and cetane numbers) is continually being improved. The quality of diesel fuel too is undergoing significant changes - reducing sulfur content to meet stringent particulate emission standards is one such change. However, these improved fuels must perform positively, meeting not only engine conditions but also without affecting engine parts or fuel behavior.

The critical issues with Indian gasoline that need to be tackled are higher percentages of benzene and other aromatics, with sulfur. Very soon, stringent environmental regulations may demand that the petroleum industry improve fuel quality. In the present era of unleaded gasoline, the octane build-up of motor gasoline is dependent on reformate naphtha. These streams are rich in aromatics and benzene. Benzene is a known human carcinogen, and therefore its rising level in the atmosphere (established by measurements taken in various cities) is of utmost concern. Recently, efforts have been made in Delhi to reduce benzene levels in gasoline from three to one percent.

While these developments have continued, ethanol, a biomass-based renewable fuel, has been explored in many countries as a potential fuel to reduce harmful emissions. Historically, ethanol was one of the first fuels used in automobile engines. It was extensively used in Germany during World War II, and in Brazil, the Philippines, and the United States. In the US, the use of ethanol as an oxygenate in Reformulated Gasoline (RFG) is well established. It is being used in 17 states of the US and in the US capital. In Brazil, ethanol has been used as a transport fuel both as a blend and in its pure form. In the US, gasoline is blended with 10% ethanol whereas in Brazil the blending percentages are between 22-24%. The ongoing debate in the US on the use of methyl-tertiary-butyl ether (MTBE) as an oxygenate, which can cause underground water pollution, is making the choice of ethanol more prominent. In case MTBE is phased out, ethanol would emerge as a potential replacement in RFG. Today, 12 countries have the experience of using ethanol as a transport fuel - Brazil, USA, France, Indonesia, the Philippines, Guatemala, Costa Rica, Argentina, the Republic of South Africa, Kenya, Thailand and Sudan.

On the other hand, India, an agricultural country, is still searching for reasons to introduce ethanol in the transport sector despite several debates and promotional measures in the past. Even though India has a production base of 1,300 million liters of ethanol per annum against a total installed capacity of more than 3,000 liters per annum, it is still far from framing any national policy on its use. Currently, ethanol is produced from molasses, and the prospects of producing it from other sources, such as directly from sugarcane juice and grains, qualifies this fuel as a long-term perspective.

This is an opportunity for India’s leaders to pursue alternative sources of energy produced from agricultural resources. However, this can only happen when there is greater emphasis on protecting the environment. To begin with, a new energy (fuel) policy that includes biomass-based fuel production and usage must first be ‘sold’ to the public through an effective public information campaign. Depleting fossil fuel sources and recent fluctuations in oil prices should interest us in utilizing our vast agricultural potential to help create a sounder, more environment-friendly energy policy.

The government’s initiative to test ethanol under a demonstration program in Maharashtra and the visit of a government delegation to Brazil and the US to gain international experience deserve attention. However, this initiative itself seems to be taking a much longer time than the quantum leap required for using this sustainable fuel in the transport sector.

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Looking for Solutions Together

Ever since the petroleum crisis was felt in the country, the Federation of Indian Chambers of Commerce and Industry (FICCI) has been striving to find a viable solution to mitigate the above crisis, particularly in the transport sector.

In this regard, FICCI organized a national seminar on 18 October 2000. Shri Shanta Kumar, the Union Minister of Consumer Affairs, inaugurated the seminar, and Shri Ram Naik, Minister, Petroleum and Natural Gas gave the valedictory address.

Experts opined that the blending of alcohol is the first step as it reduces 30% of hydrocarbon emissions in comparison with gasoline. It was further commented that blending up to 22% would not pose any danger of corrosion. Also, no changes are required in vehicle engines.

So far as the availability of ethanol is concerned, no shortage was felt as this could be produced from molasses and other agri-wastes which are available in plenty. Barriers/impediments discussed were:

• Motor spirit (MS) in the country is available in surplus and the use of ethanol may further render MS surplus and require its export by oil companies.
• The process of reforms and gradual dismantling of Administered Price Mechanism (APM) for petroleum products is on. Apart from retaining flagship interest in three major oil companies - Oil and Natural Gas Corporation, Indian Oil Corporation and Gas Authority of India Ltd - disinvestment of Government share in others is on the cards.
• Pricing of ethanol should be such that the rate per liter should be lower than crude oil prices and even that of imported spirit minus duties and taxes.
• An investment of about Rs 40-45 lakhs is to be undertaken by sugar units for the production of anhydrous alcohol required for blending with MS. A long-term commitment from oil companies on lifting the product is needed before making the investment.

Shri Ram Naik stated that the Ministry could sort out all the problems and be in a position to blend ethanol in MS on a larger scale through field trials. In view of the likely benefits that will accrue to sugarcane farmers, and the environmental benefits, the Government might consider suitable tax concessions at an appropriate time to promote this fuel. Proposed Action Plan

• Timely and efficient conclusion of pilot plant trials.
• A government policy decision on the usage of 5% v/v ethanol in gasoline.
• Flexibility to oil companies to use 0-10% v/v ethanol blended with gasoline depending on location and period so as to take care of logistics and seasonality (so long as the average usage of ethanol over the year is 5%).
• A law should be promulgated to provide for the use of only oxygenated gasoline. Ethanol should be used as the preferred oxygenate, with some tax concessions for oil companies as an incentive.
• Incentives may be provided from the savings in expenditure on public health, as replacement of hazardous chemicals by ethanol will reduce pollution and consequent health problems.
• Central and State Government support in terms of policies, exemptions and incentives. A uniform set of policies is desired across all States.
• Oil industry to accept bio-ethanol, prepare guidelines for preparing, handling, storing, distributing gasoline-ethanol blends including logistics.
• Automobile industry to extend warranty to ethanol- based fuels.