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January 13, 2026

Ethanol blending with petrol reduces consumption of petrol, contribute to climate action and save imports

Government of Nepal recently has approved ‘Order-2082’ on the use of ethanol blended in petroleum fuel. The Council of Ministers meeting held on 5th January decided to approve the order. Ethanol blending with petrol is beneficial from the point of view cost matter and environmental actions. Some questions on production of ethanol in Nepal, price […]

Government of Nepal recently has approved ‘Order-2082’ on the use of ethanol blended in petroleum fuel. The Council of Ministers meeting held on 5th January decided to approve the order.

Ethanol blending with petrol is beneficial from the point of view cost matter and environmental actions. Some questions on production of ethanol in Nepal, price matters, effects efficiency of vehicles in petrol engine using blended with ethanol and impact to climate actions are a few questions experts should clear with research based evidences so as users will not get confused on the benefits as claimed.

Ethanol fuel is fuel containing ethyl alcohol, the same type of alcohol as found in alcoholic beverages. It is most often used as a motor fuel, mainly as a biofuel additive for gasoline.

Several common ethanol fuel mixtures are in use around the world. The use of pure hydrous or anhydrous ethanol in internal combustion engines (ICEs) is possible only if the engines are designed or modified for that purpose. Anhydrous ethanol can be blended with gasoline (petrol) for use in gasoline engines, but with a high ethanol content only after engine modifications to meter increased fuel volume since pure ethanol contains only 2/3 the energy of an equivalent volume of pure gasoline. High percentage ethanol mixtures are used in some racing engine applications since the very high octane rating of ethanol is compatible with very high compression ratios.

Ethanol (CH3CH2OH) is a clear, colourless liquid. It is also known as ethyl alcohol, grain alcohol, and EtOH. Ethanol has the same chemical formula regardless of whether it is produced from starch- or sugar-based feedstocks, such as corn grain (as it primarily is in the United States), sugar cane (as it primarily is in Brazil), or from cellulosic feedstocks (such as wood chips or crop residues).

Ethanol has a higher octane number than gasoline, providing premium blending properties. Minimum octane number requirements for gasoline prevent engine knocking and ensure drivability. Lower-octane gasoline is blended with 10% ethanol to attain the standard 87 octane.

Ethanol contains less energy per gallon than gasoline, to varying degrees, depending on the volume percentage of ethanol in the blend. Denatured ethanol (98% ethanol) contains about 30% less energy than gasoline per gallon. Ethanol’s impact on fuel economy is dependent on the ethanol content in the fuel and whether an engine is optimized to run on gasoline or ethanol.

Blending ethanol with petrol will bring multifaceted benefits to the country’s economy, environment and domestic industry. The blending will have a positive impact on the environment.

Gasoline emits harmful gases such as carbon monoxide, carbon dioxide, sulfur dioxide and nitrogen oxides, which increase air pollution, but adding ethanol, which has a higher oxygen content in gasoline, improves the combustion process of the fuel and reduces the emission of harmful gases significantly.

It is assumed that the plan of blending ethanol with petrol will be very beneficial in the context of protecting the environment and Nepal’s commitment to achieve ‘net zero carbon’ (zero carbon emission) by 2045 on the international forums.

Nepal Oil Corporation, from an economic point of view, says that this plan will help to reduce Nepal’s trade deficit. At present, 100 percent of petrol in Nepal is imported from abroad. According to the corporation’s plan, if 10 percent ethanol is added to the gasoline, then the import of petrol will be reduced by 10 percent.

Since sugarcane molasses and cassava, the raw materials required for ethanol production, will be produced in the country, it will also make the economy of the agricultural sector sustainable.

Ethanol will not be allowed to import for the purpose of blending with petrol. Only ethanol produced from sugar mills and other industries of Nepal will be used. This will increase the investment in the domestic industry, NOC further mentions.

However, it is to be noted that around two billion rupees is needed to establish an ethanol plant which will provide employment opportunities to 300 to 500 persons.

Moreover, there are some technical challenges in use of ethanol blending with petrol. Ethanol has the property of absorbing water from the air (hygroscopic). If the water content in the fuel is more than 0.5 percent, engine problems may occur. Therefore, ethanol used in vehicles should be 99.5 percent pure (anhydrous). The NOC says that it is ready to manage such requirements.

Many, mostly users, doubt that the effect of ethanol in the engine of the vehicle. Whereas authorities say that there will be no problem using petrol mixed with 10 percent ethanol in regular vehicle that may even 20-year-old.

It is also to be noted that 20 percent ethanol is blended in India. Similarly, in Brazil and America, 10 to 80 percent ethanol is used. In those countries, 10, 20, 40, 50, 70 to 80 percent ethanol has been tested and used.

However, as the amount of ethanol in petrol increases, the normal engine does not work. “Although ethanol is used in high amounts (70-80 percent) in Brazil and America, the engines of the vehicles are designed to match higher ratio of ethanol to petrol.

Moreover, number of electric vehicles are growing in Nepal. That means electricity is replacing fossil fuels, so ethanol blending with petrol may be understood as unwise now on. But, those vehicles run by petrol we already have will need petrol to run for around 20 years to come. So ethanol will support reduce import and consumption of petrol.

India’s E20 (20% ethanol) ethanol-petrol blend faces issues like engine damage concerns for older vehicles, reduced mileage, higher repair costs, and lack of consumer choice, stemming from a rapid rollout without sufficient preparation for non-compliant cars, despite government aims for energy security and lower emissions. Technical issues include ethanol’s corrosiveness damaging rubber parts and fuel lines, affecting older engines not designed for it, and a marginal drop in fuel efficiency, although automakers claim modern cars are compatible. 

They report lower mileage and engine problems such as rough idling, hard starts and clogged filters. Concerns grew last week after an Indian insurer said engine damage from using the wrong fuel would not be covered by insurance.

Citing the United States and Brazil, the world’s top ethanol users, Indian petrol consumers have demanded an option to buy lower blends for older vehicles.