E20 Petrol Controversy Rages On: Is Your Car Safe? We Explain

Car owners across the country are discovering an uncomfortable truth: their fuel bills are rising, their engines are working harder, and their vehicles' mileage is dropping dramatically. The culprit? E20 petrol, a fuel blend containing 20% ethanol that has quietly become the new normal at petrol pumps nationwide, often without clear labelling or consumer awareness.

The controversy centres on a simple question: Why are millions of car owners paying the same price for fuel that delivers less energy and potentially damages their engines?

"At petrol pump today, I told manager concern about reduced fuel Avg. His reply stunned me. He said pakka reduce hoga sir. Pehle 5% Ethanol mix karte the. Fir 10% kiya. 20% tak aa gay. Ab batate hi nahi kitna. About 30% ho raha mix," shared one user on social media, highlighting the confusion and lack of transparency at fuel stations.

Car owners report mileage drops ranging from 10 to 20% since the widespread introduction of E20. One user complained that his car's efficiency plummeted from 15 km per litre to 11.5 km per litre within a month. Another noted a drop from 17 to 18 km/L to around 14 km/L in a relatively new 2022 vehicle.

The Fast-Forwarded Rollout Leads To Compatibility Crisis

The government achieved its 20% ethanol blending target by March 2025, five years ahead of the original 2030 deadline. Yet many petrol pump attendants remain unaware of what they're dispensing, and fuel companies are not consistently labelling their pumps to indicate ethanol content.

The fundamental problem lies in vehicle compatibility. Most cars manufactured before March 2023 were not designed for E20 fuel. While newer vehicles come with E20-compliant engines, the vast majority of cars on Indian roads remain vulnerable to potential damage.

Result is that most vehicles on road are not E20 Petrol compatible. Honda stands as the notable exception. All Honda vehicles manufactured after January 1, 2009, are E20 compatible. Other manufacturers like Hyundai, Maruti Suzuki, Tata, and Mahindra have introduced E20-compliant models only since 2023.

For older vehicles, using E20 can lead to a range of problems: corroded fuel systems, clogged injectors, degraded rubber seals, poor starting performance, and increased engine wear. Ethanol is hygroscopic, meaning it absorbs water from the atmosphere, which can cause corrosion in metal fuel tanks and fuel system components.

Less Energy Means Lower Mileage

Ethanol contains approximately 33% less energy per unit volume than petrol. This fundamental chemistry means E20-blended fuel inherently delivers lower mileage. Research indicates that even E20-compliant vehicles experience a 5 to 8% drop in fuel efficiency, while older vehicles can see reductions of 10 to 15%.

The Automotive Research Association of India found that fuel economy decreased by up to 6% on average when testing E20 in various vehicle types. However, real-world user reports suggest the impact is more severe, with many experiencing drops of 15 to 20%.

Mixed Messaging Fuels Confusion

The controversy has been amplified by contradictory statements from government officials. While Petroleum Minister Hardeep Singh Puri recently denied plans to increase ethanol blending beyond 20%, Road Transport Minister Nitin Gadkari announced that guidelines for 27% ethanol blending (E27) would be finalised by August 2025.

This pattern of leaked proposals followed by denials and eventual implementation has become characteristic of the government's approach to sensitive policies. Citizens have noted this technique was previously used with two-wheeler toll policies, where initial denials were followed by selective implementation.

The E27 announcement has particularly alarmed car owners since no current vehicle is engineered to handle such high ethanol concentrations. If implemented without adequate preparation, it could cause widespread engine damage across the existing vehicle fleet.

Why Shouldn’t the Petrol Prices Come Down?

Despite ethanol being significantly cheaper than petrol, costing around Rs 57.97 per litre compared to petrol prices above Rs 100, consumers have seen no reduction in fuel prices. Studies suggest that 15% ethanol blending could theoretically reduce petrol prices by Rs 3.5 to Rs 5.1 per litre.

The pricing structure reveals the disconnect. While ethanol faces only 5% GST, petrol carries heavy excise duties and VAT that comprise around 50% of the retail price. Oil marketing companies are purchasing ethanol at much lower rates but maintaining petrol prices at current levels, effectively increasing their margins while consumers bear the efficiency costs.

Conflict of Interest Allegations

Adding to the controversy are allegations of conflict of interest. Nitin Gadkari's son Nikhil heads CIAN Agro, a company engaged in ethanol production and distribution. The company has signed agreements to develop new ethanol production technologies and operates alongside the family's Manas Group, which runs sugar, distillery, and ethanol businesses.

Critics argue this creates a situation where policy decisions directly benefit the minister's family businesses, while consumers bear the costs through reduced vehicle efficiency and potential engine damage.

Warranty Under Question

Manufacturers have made clear that warranty coverage may not extend to engine damage caused by using E20 in non-compliant vehicles. This leaves owners of pre-2023 vehicles in a precarious position. They face potential engine damage with no recourse if they use the fuel now widely available at pumps.

Insurance claims may also be denied if engine damage is attributed to using inappropriate fuel blends in non-compliant vehicles. This shifts the financial burden entirely to consumers who often have no choice but to use whatever fuel is available at their local petrol station.

Forced Transition: Vehicle Owners Get No Say

Industry observers suggest the E20 push, combined with plans for E27 and beyond, represents a coordinated effort to force consumers toward newer technologies. By making older vehicles less viable through fuel incompatibility issues, the policy effectively encourages replacement with either E20-compliant vehicles, flex-fuel hybrids, or electric vehicles.

This aligns with the government's broader mobility vision promoting flex-fuel vehicles that can run on 100% bio-fuel and electric vehicles for zero emissions. While environmentally progressive, the transition costs are being borne primarily by existing vehicle owners rather than being managed through supportive policies or phased implementation.

The ethanol blending programme has undoubtedly achieved its stated goals of reducing crude oil imports and supporting farmers. But for millions of car owners, the reality is rising fuel costs, declining vehicle performance, and uncertainty about their vehicles' longevity, all while paying full price for fuel that delivers less energy than what they previously received.

As the government prepares to move beyond E20 toward even higher ethanol concentrations, the fundamental question remains unanswered: Who will bear the cost of India's green fuel transition, and is the current approach fair to existing vehicle owners who had no choice in the matter?