Has E20 Petrol Cost Motorists Rs 88,234 Crore Extra?
Written By: Vikas Kaul
Published: August 2, 2026 at 11:48 AM
Updated: August 2, 2026 at 11:48 AM
A new analysis by The Reporters Collective estimates that motorists spent Rs 88,234 crore on additional fuel between April 2023 and March 2026 due to ethanol-blended petrol delivering less energy per litre than pure petrol. The estimated burden for FY2025-26 alone is Rs 37,843 crore.
Calculation and Methodology
The calculation is based on a fundamental physical fact: ethanol contains approximately 33 percent less energy per litre than petrol. At a 20% blend (E20), the theoretical energy content is roughly 6.7 percent lower than unblended petrol.
It’s important to note: this doesn’t mean every vehicle will experience exactly a 6.7 percent mileage loss. Factors such as engine calibration, traffic conditions, driving style, temperature, and the vehicle’s original fuel compatibility influence the outcome. Therefore, the Rs 88,234 crore figure is an estimate, not a precise measurement of each motorist’s fuel bill.
How the Estimate Was Derived:
- Average ethanol blending increased from 11.8 percent to nearly 20 percent over three financial years.
- Total motor-spirit consumption in FY2025-26 reached 42.6 million metric tonnes.
- The analysis calculated that the same energy demand would have required approximately 39.76 million metric tonnes of pure petrol.
- This resulted in a difference of 2.83 million metric tonnes for the studied year and 6.57 million metric tonnes across the three years.
- The additional volume was valued using prevailing petrol prices in Delhi, assuming unblended petrol could have been sold at the same pump price as blended fuel.
Government Records and Acknowledgement
Government documents from 2021 already estimated a 6 to 7 percent fuel efficiency loss for four-wheelers originally designed for E0 and calibrated for E10. For comparable two-wheelers, the estimated loss was 3 to 4 percent. A more recent NITI Aayog roadmap stated that for four-wheelers designed for E10 and calibrated for E20, the loss was significantly lower, at 1 to 2 percent.
Limitations of the Estimate
The estimate assumes a direct correlation between fuel demand and calorific value with minimal adjustments. It cannot fully account for factors like varying annual driving distances, congestion levels, changing vehicle types, or shifts in two-wheeler and car usage patterns.
While the government asserts that E20-compatible vehicles show no significant performance variations or abnormal wear in testing, detailed official field trial reports remain largely inaccessible to the public.
Ethanol blending does offer benefits like reduced crude oil dependence and domestic ethanol production, but these do not negate the lower energy content or the associated pump price costs. The practical concern revolves around pricing; E20 petrol has not been discounted to compensate for its lower energy content, while unblended petrol is scarce and more expensive.