“Energy shock” pushes Asian countries to biofuels

Taxi driver Ravi Ranjan, who lives with his wife and their child in the Indian capital, New Delhi, says that shipping disruptions caused by the Iran war are forcing him to pay more money for cooking fuel, at a time when Indian Prime Minister Narendra Modi is urging residents to rationalize driving and transportation.

For Ranjan, all of this has a negative impact on his income, as he began to pay three times the price of LPG after the delay in the arrival of cooking fuel. He used to buy an LPG cylinder for 1,000 rupees ($11), but now he pays 3,000 rupees ($31) on the black market.

On the other side of the country, in the coastal city of Chennai, Sushmita Sankar, an advertising executive, says that expenses on gasoline and cooking fuel are rising dramatically due to the war, pointing out that gasoline mixed with “ethanol,” the reserve mixture currently available at gas stations, leads to a decline in the fuel consumption efficiency of her car.

In light of the shortage of cooking gas and the rise in crude oil prices, India has proposed allowing vehicles to operate on 85% or even 100% ethanol. It has also banned all sugar exports, at least until next September, to ensure the availability of domestic supplies of sugar, as well as the availability of sufficient raw materials if ethanol mixing levels are raised.

The government says that increased use of ethanol reduces pollution caused by vehicles, but there are concerns among drivers about fuel efficiency, and environmental experts say that the production of corn, rice and other grains for use in manufacturing ethanol may affect food supplies and livestock needs.

It is noteworthy that Asia was the first and most affected region by the disruption in fossil fuel supplies due to the closure of the Strait of Hormuz. As countries prepare for a second wave of repercussions, governments are seeking to increase the use of biofuels to reduce fuel imports. Indonesia and Malaysia are also pushing to adopt policies to increase the mixing of fuels with palm oil-based alternatives, despite expert warnings that this may lead to expanding agricultural areas and deforestation.

Indian Prime Minister Narendra Modi recently called on citizens to adopt “responsible national choices” to save fuel, by increasing the use of public transportation, car sharing, and avoiding international travel.

The Indian government sought to diversify oil sources, and proposed increasing levels of biofuels, but this did not mitigate the shock, except to a limited extent, according to energy experts. Most gas stations in India now sell a mixture containing 20% ​​ethanol, after the country achieved its goal of implementing the mixture at the national level in 2025, five years before the government’s target date.

Policymakers are considering increasing the blending percentage of all gasoline to 27% by 2030, and the Indian Ministry of Transport’s recent announcement, which proposes allowing vehicles to run on 85% or even full ethanol, is the strongest signal yet for car manufacturers to start producing vehicles compatible with these higher ratios.

According to the Institute for Energy Economics and Financial Analysis, a 20% ethanol blend in India has led to a 2.5% reduction in crude oil imports in 2025.

As for the Southeast Asian region, bioenergy is a means of protection from the current crisis and from future shocks, according to Reza Yousri, an energy expert at Ramboll Consulting.

Indonesia seeks to increase the proportion of biofuel mixing to 50% biodiesel, compared to 40% currently, within the framework of a program launched by President Prabowo Subianto, last March, when he said: “We are moving strongly towards biofuels.” The biofuel initiative is part of Indonesia’s efforts to achieve “energy sovereignty” in response to the recent fuel unrest, according to Putra Adijuna, of the Energy Shift Institute, in the capital, Jakarta, who said that mixing fuels will also help Indonesia develop a local market for the palm oil that it sells globally, but he cautioned about the need to monitor the clearing of land and forests.

Last April, Malaysia approved a proposal to gradually increase fuel mixing to 15% biodiesel and 85% fossil diesel, with a study of raising the percentage to 20% in the future. Although blending ethanol is often presented as an alternative to gasoline, experts warn that the matter is more complicated, as ethanol is less energy dense than gasoline, which means that vehicles consume more fuel to cover the same distance. There are still concerns that the crops needed to produce ethanol may affect the size of food supplies, raising prices and increasing pressure on water.

In India, about 70% of ethanol comes from crops such as sugarcane, corn and rice. Producing one liter of ethanol may require between 3,000 liters and 10,000 liters of water.

. 70% of ethanol in India comes from crops such as sugarcane, corn and rice.