The government has formed a committee to evaluate the feasibility of introducing ethanol-blended petrol in the local market.
The committee will be chaired by the Minister of Petroleum and include the Minister of Finance, the Minister of State for Finance, and the Secretary of the Petroleum Division, reported a national daily.
The committee’s mandate includes developing a policy for ethanol blending, studying international practices, and analyzing past attempts in Pakistan. The Prime Minister has set a one-month deadline for the committee to finalize its recommendations.
The oil sector isn’t comfortable with this idea. Industry insiders argue that blending ethanol with petrol is not commercially viable for refineries or the sugar industry which produces ethanol. Previous efforts had failed due to similar concerns, they complained.
Ethanol can technically be blended with petrol but commercial feasibility is a complicated affair. Ethanol fetches high prices on the international market, making it expensive for local refineries. Additionally, increasing domestic sugarcane production to lower ethanol costs could negatively impact other crops, posing another challenge.
Brazil successfully blends ethanol with petrol due to its vast sugar production. Replicating this in Pakistan is unlikely given the current economic and agricultural landscape.
