• The Department of Food & Public Distribution has come out with a scheme to help cooperative sugar mills convert their sugarcane-based ethanol plants into multi-feedstock facilities, enabling year-round operations using grains such as maize and damaged food grains.

• This conversion will allow cooperative sugar mills to maintain operations beyond the typical 4-5 month sugarcane crushing season.

• The initiative, announced under the modified Ethanol Interest Subvention Scheme, will provide interest subsidies of 6 per cent per annum or 50 per cent of bank interest rates, whichever is lower, for five years including a one-year moratorium period.

• The measure aims to support the government’s Ethanol Blended with Petrol (EBP) Programme, which targets 20 per cent ethanol blending with petrol by 2025.

• The government has implemented various ethanol interest subvention schemes since July 2018, as part of its push toward greater energy independence and reduced fossil fuel imports. 

Highlights of the scheme:

• The scheme addresses operational inefficiencies at cooperative sugar mills by enabling them to process alternative feedstocks when sugarcane is unavailable, improving their financial viability and contributing to national biofuel targets.

• The sugarcane crushing period is limited to 4-5 months only in a year due to which sugar mills can operate for a limited period of time. This further leads to reduction in their overall operational efficiency and productivity.

• To ensure the functioning of cooperative sugar mills throughout the year, their existing ethanol plants can be converted into multi-feedstock based plants to use grains like maize and DFG under the new modified scheme.

(The author is a trainer for Civil Services aspirants.)