India forges global biofuel alliance in push toward net-zero aim

The Global Biofuel Alliance, which include top producers Brazil and the US, has been one of India’s key priorities for the G-20 presidency. Indian Prime Minister Narendra Modi called on G-20 members to collaborate on the fuel-blending initiative as the South Asian nation aspires to increase ethanol mix in gasoline to as much as 20%.

This is the second major global initiative on green energy pioneered by the country after the launch of International Solar Alliance in 2015 and is expected to boost Modi’s credentials as global climate leader. During Modi’s nine-year tenure, India added renewable capacity at a record pace, but still pushes back on coal phase-down demands, citing its growing energy needs.

The global alliance will help build the worldwide market in biofuel trade, and fuels obtained from biomass could serve multiple purposes for India. India wants to tap into Brazil’s experience in running vehicles on blended ethanol, and it can use pellets made of crop waste to displace a certain amount of coal in its power plants.

Turning biomass into fuel will help India use up the thousands of tons of crop waste that farmers are currently forced to burn every harvest season, enveloping much of northern India in smog for weeks.

Adding ethanol to conventional fuels reduces the need for crude oil, the biggest component of India’s import bill. Refiners, such as Indian Oil and Bharat Petroleum Corp. currently mix 12% ethanol in gasoline, and the government plans to raise the target to 20% blending by 2025. Federal Oil Minister Hardeep Puri, who during his time as a diplomat served as India’s ambassador to Brazil, is leading the push.

Globally, the use of biofuels reduced the consumption of 2 million barrels of oil equivalent per day in 2022, equivalent to 4% of the global transport sector oil demand, according to the International Energy Agency. Local production in emerging markets, mainly Brazil, India and Indonesia, avoided $38 billion of import costs, the agency said.