India has fully transitioned to E20 fuel, a blend of 80% petrol and 20% ethanol, at nearly all of its 90,000 fuel stations. While the government’s aim is to reduce oil imports, lower carbon emissions, and support sugarcane farmers, the move has not been without controversy, with the Supreme Court now set to hear a public interest litigation on the matter.
Why the E20 Fuel Rollout Is Controversial
The new fuel blend has sparked a heated debate due to several key issues that affect vehicle owners and the environment.
- Vehicle Compatibility and Damage: The E20 fuel is officially compatible only with vehicles manufactured after April 2023. Older cars and two-wheelers risk a range of problems from using the new fuel, including engine knocking, corrosion, and damage to rubber and plastic components. This has led to concerns among car manufacturers about potential warranty issues and higher repair costs for consumers.
- Lower Mileage: A common complaint from drivers is a 6-8% decrease in fuel efficiency. While the Society of Indian Automobile Manufacturers (SIAM) acknowledges that a drop in mileage is to be expected, they claim a 2-4% decrease in controlled tests. However, they concede that the real-world impact on mileage could be higher, leading to increased spending per kilometer for consumers.
- Fuel Price: Although ethanol is cheaper than petrol, E20 fuel is priced at almost the same rate as regular petrol at pumps. This means that consumers get a less efficient fuel at a similar price, putting the financial burden on vehicle owners rather than the government or fuel companies.
- Environmental Concerns: While the blending of ethanol is meant to lower carbon emissions, experts warn that it could increase other harmful emissions like aldehydes. Furthermore, the large-scale production of ethanol from sugarcane raises serious concerns about water scarcity in India.
E20 Production and Supply
To meet the demand for E20 fuel, India needs over 1,000 crore liters of ethanol annually. While production capacity has increased significantly, reaching 1,810 crore liters by mid-2025, it still needs to catch up to fully support the demand. Despite this, the blend rate had already reached 18.74% by May 2025.
The rollout of E20 fuel is a significant policy shift with broad implications for India’s economy and environment. The ongoing legal challenge and public debate highlight the complexities of balancing national goals with consumer and environmental concerns.