Ethanol has been a hot topic of discussion over the past weeks. The government’s decision to transition to a E20 ethanol-petrol blend from the previous E10 blend has met with mixed responses from consumers and the automobile industry. Questions abound about its timing, necessity, effect on fuel efficiency and potential for damage to their vehicles.

Obviously, ethanol-doping is not new, but the issue has resurfaced now with the move to go to E20, even as the markets are still processing the context and possible inflationary impact of the US-India tariff spat on oil prices. The two may not be interconnected, but that hasn’t stopped the rumour mills from working overtime, creating confusion that blends legitimate worries with outright misinformation.

Here’s an attempt to break down the issue, placing it within global and domestic contexts, and also a look at the engineering perspective of what to expect as a vehicle owner who uses E20 fuel. Also here, are some suggestions as to what the government can do so that the consumer can make an informed choice.

Why countries choose ethanol

The reason why governments around the world have chosen ethanol-blends has almost always been for import substitution, with a pinch of environmental friendliness thrown in. Within the current oil price scenarios, ethanol is relatively less expensive to produce and offers an opportunity to reduce dependence on imported oil. If the price of oil remains stable, at the pump, this should mean lower prices for consumers. If oil price is volatile, it should lessen the risk of revenue fluctuations for the government. 

Ethanol extraction and distillation is best done from high sugar content crops, and the big producers around the globe are the ones that are big producers of sugarcane, corn, potato etc. Not surprisingly, the countries that rank at the top of the list of ethanol producers are the US, Brazil and India. The EU and China are the next two podium contenders. Just the US alone produces more than half the world’s output and