The government formulated a plan to mix ethanol into petroleum products two decades ago but has not implemented it yet. If the government mixes ethanol into petrol, it could reduce petrol imports by about Rs 1.25 billion annually, but the plan remains stalled.

While India has sold petrol blended with ethanol to consumers for many years, Nepal has not adopted this practice. Ethanol, a flammable substance with strong burning power, reduces pollution by lowering engine emissions. Producers can make it from sugarcane, straw, dried grass, and similar materials. Since Nepal imports petrol from India, blending ethanol would also help save foreign currency.

The government developed the ethanol blending plan back in 2003. However, delays in formulating production and usage procedures have prevented the government from implementing the policy to mix ethanol into petroleum products.

Chandika Prasad Bhatta, Executive Director of Nepal Oil Corporation (NOC), said they prepared the procedures for mixing ethanol into petrol and submitted them to the Ministry of Industry, Commerce, and Supplies. Bhatta explained that blending ethanol into petrol and selling it would reduce imports. "We prepared the procedures and submitted them to the ministry," Bhatt said. "Once the government approves and ethanol production begins, we will start the blending process."

Studies show that mixing ethanol into petrol can reduce petrol imports by about Rs 1.25 billion annually. The NOC's study found that blending ethanol into petrol and selling it would reduce the country's daily petrol consumption by 400,000 liters.

Nepal consumes about 4 million liters of petrol daily. It can blend 10 percent ethanol into petrol. Based on this, the country could cut petrol imports by 144 million liters annually. The Oil Corporation currently imports and sells petrol through Indian Oil Corporation (IOC).

The NOC pays Indian Oil Corporation (IOC) about NPR 85 per liter to buy petrol. Blending ethanol into petrol could reduce the country's petrol imports by 144 million liters annually. At the current purchase price, this reduction would save approximately NPR 1.241 billion.

This year, the government announced plans to cut petrol imports by blending bioethanol into petrol. Finance Minister Bishnu Paudel included the bioethanol blending plan in the budget for the upcoming fiscal year 2082/83 to control pollution and reduce petrol imports.

Since producers make ethanol from agricultural products, Executive Director Bhatt urges the government to promote it. "It also provides farmers with a source of income," Bhatt said, "while reducing environmental pollution and supporting farmers' livelihoods."

India aims to increase ethanol use to at least 30 percent by 2030. The Indian government has adopted policies to promote ethanol production. It also considers ethanol blending environmentally friendly. Petrol sold in India contains ethanol blends ranging from 12 to 20 percent, depending on the region.

Executive Director Bhatta says Nepal will face no difficulty using ethanol if it produces it locally. "Farmers can produce ethanol, and once the government sets the price, the corporation stands ready to use it," he said.

While the government promotes electric vehicles, petroleum industry experts call for in-depth discussions about ethanol use. They emphasize the need for serious dialogue on ethanol blending in petroleum products.

Ethanol can blend into petroleum products, but it must remain consumer-friendly and environmentally safe. Authorities should consider both environmental impact and consumer interests when implementing ethanol blending.

By Dilip Paudel