E20 causes ‘minor’ drop in vehicle mileage, Puri says, as India gears up for E100 fuel

The Minister of Petroleum and Natural Gas Hardeep Singh Puri on Thursday acknowledged that vehicles running on E20 petrol could witness a “minor” drop in fuel efficiency, according to a Times of India report, even as the government defended the nationwide rollout of ethanol-blended fuel and dismissed growing concerns over its impact on vehicle performance

The petroleum Minister admitted that mileage "may drop a little" with E20 fuel but argued that the trade-off was outweighed by better acceleration and improved engine performance. "Mileage, yes, it may drop a little, but mileage can drop a little because of various things," Puri said, as quoted by TOI, adding that ethanol-blended fuel improves acceleration and reduces engine knocking.

India adopted 20% ethanol blending in petrol after consulting all stakeholders, including SIAM and ARAI, and would move to 25% blending only after completing all necessary tests, he said, adding that the concept of ethanol blending was not new and prominent car maker Henry Ford called it the "fuel of the future".


The remarks assume significance as they come months after E20 petrol became the default fuel across the country, replacing lower ethanol blends such as E10 at retail outlets. The nationwide rollout has sparked concerns among consumers over reduced fuel efficiency, compatibility with older vehicles and the absence of consumer choice at fuel stations.

Also read: India’s ethanol strategy: Automakers treading cautiously, consumers remain unconvinced and experts are wary

E20 concerns loom

Unlike markets such as Brazil and the United States, where motorists can choose between multiple ethanol blends, Indian consumers now largely have access only to E20 petrol. Owners of older vehicles have expressed concerns time-and-again because several vehicle manuals recommend only E5 or E10 fuel, although the government and the automobile industry maintain that warranties and insurance remain unaffected.

The acknowledgement comes days after the automobile industry said laboratory tests indicate fuel efficiency falls by around 2-4% with the use of E20 fuel, though the impact could be higher under real-world conditions and in older vehicles, according to Reuters.

The government's stance also marks a shift in the public conversation around ethanol-blended petrol. Over the past few weeks, the Ministry of Petroleum and Natural Gas has repeatedly dismissed viral social media claims linking E20 to engine failures, vehicle breakdowns and insurance complications.

In a statement issued on June 23, the ministry termed such claims "misleading and unsubstantiated" and said no widespread engine failures attributable to ethanol blending had been reported since the rollout of E20. It also clarified that the programme had undergone extensive scientific evaluation and stakeholder consultations before implementation.

Govt backs ethanol blending under energy security roadmap

Despite concerns over mileage, the Centre continues to view ethanol blending as a key pillar of India's energy security strategy. Last year, the government estimated that E20 will help reduce crude oil imports enough to save around Rs. 43,000 crores in foreign exchange in FY26, while generating nearly Rs.40,000 crore in additional income for farmers through higher demand for sugarcane- and grain-based ethanol, as reported by Reuters.

The E20 programme is also aimed at reducing emissions and lowering India's dependence on imported fossil fuels.

The ethanol roadmap is unlikely to stop at E20

ET had reported earlier this week that the government has already initiated testing of E25 petrol, with ARAI evaluating its impact on performance, durability and fuel efficiency on both E10- and E20-compliant vehicles over 150,000 km. The findings will subsequently be verified by the International Centre for Automotive Technology (ICAT) before the Ministry of Petroleum and Natural Gas decides whether a higher blending mandate should be introduced.

The transition to higher ethanol blends has also found broad support across the automotive and energy ecosystem, although stakeholders have called for a calibrated rollout.

According to KPMG's report ‘Beyond E20: Repositioning ethanol as India’s transport energy backbone’, industry participants have emphasised the need for clearer consumer communication, continued vehicle testing and a gradual expansion of flex-fuel vehicle infrastructure as India moves towards higher ethanol blends.

Also read: E25 petrol blend's test drive begins; study report expected by end of next year

The next step for flex-fuel vehicles is E85

Even as the government prepares to test E25 petrol, it has already begun rolling out E85 fuel, which contains 85% ethanol and 15% petrol. Last month, Petroleum Minister Hardeep Singh Puri launched E85 at select retail outlets, announcing plans to expand its availability to 500 fuel stations by the end of 2026 and 5,000 outlets by the end of 2027.

Unlike E20, E85 is designed primarily for flex-fuel vehicles that can operate on varying blends of petrol and ethanol. The government has positioned E85 as the next phase of India's biofuel roadmap, aimed at further reducing crude oil imports, lowering carbon emissions and expanding the domestic ethanol market.

Speaking at an event, Puri said that state-run oil companies will sell E85 fuel at a discount of Rs 20 per litre to offset the biofuel’s lower energy content.

E100 ahead?

Beyond E85, the Centre is also pushing E100, or 100% ethanol blended fuel, as part of its long-term clean mobility strategy. Indian Oil Corporation has already set up around 400 E100 dispensing stations across the country, although the fuel can only be used in specially designed flex-fuel vehicles.

Union Minister for Road Transport and Highways Nitin Gadkari approved giving legal recognition for 100 per cent ethanol blend fuel last month, saying that such a move will help reduce import dependence.

According to the KPMG report, higher ethanol blends such as E85 and E100 will require dedicated vehicle technologies, wider dispensing infrastructure, pricing incentives and greater consumer awareness before they can be adopted at scale. The report says India's ethanol roadmap is expected to evolve gradually from E20 to E25 and eventually towards higher blends as the ecosystem matures.

For the government, the acknowledgement of a slight mileage loss appears to address one of the biggest consumer concerns without slowing its biofuel ambitions. As India pushes ahead with higher ethanol blending to reduce import dependence and strengthen energy security, the debate is increasingly shifting from whether E20 affects mileage to whether consumers are willing to accept that trade-off in exchange for broader economic and environmental gains.