India set to revise ethanol price

India’s Cabinet will take up a proposal to increase the purchase price of ethanol for fuel blending to Rs26-27 (US$0.57-US$0.59) a liter, DNA Money reported on its website, citing New and Renewable Energy Minister Farooq Abdullah. “We have reached an agreement (between the ministries) during late December,” he said, adding that the blending schedule is also likely to be ramped up from 5% this year to 10% during 2011. Crores of rupees worth of investment in ethanol factories has been lying idle for nearly two years after suppliers backed out of commitments to supply the biofuel at rates ranging from Rs17-20 (US$0.37-US$0.44) per liter. Abdullah, however, did not specify whether the government is thinking of extending fuel subsidies to biofuels or of giving them breaks from local taxes, a long standing demand of the oil companies. (January 6, 2009)