E85 to flourish if affordable, viable for stakeholders: Indian Oil CMD

AS Sahney, Chairman of Indian Oil, outlined that the success of the E85 high-blend ethanol program hinges on its affordability for customers and viability for both producers and oil marketing companies, ensuring it addresses India's energy security.

E85 will flourish if it is affordable for customers and commercially viable for stakeholders, according to AS Sahney, Chairman and Managing Director of Indian Oil Corp Limited. The high-blend ethanol program relies on addressing energy security while remaining sustainable for both producers and oil marketing companies.

Conditions for E85 Success

Speaking at a panel discussion at the Global Biofuels Alliance in Delhi on Tuesday, Sahney stated that the commercial success of the biofuel framework depends on balancing the financial interests of consumers, manufacturers, and distribution companies. "There are two or three components which have to be addressed. It has to be affordable for the customer; that is number one. And it has to be viable for the producer, and it has to be viable for me. And it should address energy security," Sahney stated.

He noted that these are the four basic premises on which our E20 program has flourished. "And I think E85 will flourish if it fits into these broad criteria. So it has to be affordable, which we have tried to do by putting it at a cheaper rate, E85, although it's a launch offer. It may be calibrated further as the consumption increases. That is a separate issue. And it has to be viable for a producer, and it has to be economically viable for me," Sahney added.

Infrastructure and Supply Chain Readiness

He also mentioned that the infrastructure foundation for higher ethanol blends is complete. The domestic oil marketing companies now possess the necessary operational expertise to manage the distribution chain. "The basics were cleared when we did the E20. The initial journey was challenging. Now at least we know how to handle this," Sahney said.

"We, as oil marketing companies, understand how we can manage the supply chain. So supply chain is not going to be an issue that much, I can assure you, because we understand how it is handled right now. We will use primarily the same or similar supply chains for providing E20 and E85. Only the ratios have to change," Sahney added.

Retail-Level Segregation

The implementation strategy involves a clear infrastructure division at the retail level to maintain strict quality control. "And they have to be segregated dispensing stations, segregated fuel storage tanks at the retail outlets. They will have to be segregated...We have started the E85 at around 50 locations," Sahney stated.

Learning from Past Rollouts

Reflecting on past expansion strategies, the head of the country's largest oil firm noted that timing remains critical for ecosystem readiness. "Last time, we went for E100. We went for 400 locations all across the country. I think it was a step taken too early because OEMs were not ready, the models were not ready, the flex-fuel vehicles were not ready, but we were ready with E100. This time we have learnt our lessons and are going step by step along with the OEMs," Sahney said. (ANI)

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