If you're hoping for lower monthly cooking gas expenses, the government's latest proposal could be a step in that direction, though not immediately.

According to a report by The Economic Times, the Ministry of Petroleum and Natural Gas is working on a policy to introduce ethanol as an alternative household cooking fuel alongside LPG, a move aimed at reducing India's dependence on imported cooking gas, utilising surplus domestic ethanol production and improving the country's energy security. While the proposal does not include any announcement on cutting LPG prices, industry experts believe it could eventually help reduce pressure on cooking fuel costs if ethanol becomes widely available and affordable.

The framework is expected to be ready by September, while fuel industry associations and oil marketing companies are already holding discussions with the government on its implementation.

Why is the government considering ethanol for cooking?

India today produces far more ethanol than it currently consumes. The country's annual production capacity has crossed 20 billion litres, with another 4 billion litres expected to be added this financial year.

Nearly 11 billion litres are used under the government's E20 petrol blending programme, while industries such as pharmaceuticals, chemicals and liquor manufacturing consume another 3 to 3.5 billion litres. That leaves an estimated 7 billion litres of unused production capacity, prompting policymakers to explore new applications, including household cooking.

Instead of allowing this excess capacity to remain idle, the government sees an opportunity to reduce LPG imports while creating a new domestic market for ethanol.

What could change for consumers?

If the proposal goes ahead, households may eventually be able to buy ethanol for cooking through specially designed dispensing units, similar to fuel stations, at outlets operated by state-run oil marketing companies.

Consumers would use specially designed ethanol-powered cooking stoves, which have already undergone trial runs. Officials are also considering subsidy support that could either reduce the upfront cost of purchasing these stoves or provide continued financial assistance to encourage adoption.

Will LPG become cheaper?

Not immediately.

The government has not announced any reduction in LPG prices, and the proposed policy is still under discussion. However, experts say that if ethanol gains widespread acceptance, it could gradually reduce India's dependence on imported LPG.

Lower imports could ease the government's subsidy burden and improve supply stability, factors that may help moderate cooking fuel costs over the longer term.

Why is the policy being discussed now?

The proposal comes after global energy supply disruptions highlighted India's dependence on imported LPG. The conflict in West Asia exposed vulnerabilities in fuel supplies, with a significant share of India's LPG imports passing through the Strait of Hormuz.

To strengthen energy security, state-owned oil marketing companies are also preparing plans to expand strategic LPG storage capable of meeting nearly a month's demand.

Promoting domestically produced ethanol is seen as another way to diversify India's cooking fuel mix and reduce exposure to global supply shocks.

The Petroleum Ministry is expected to finalise the policy framework in the coming months. If approved, it could pave the way for ethanol-powered cooking stoves, dedicated retail distribution networks and possible government incentives for consumers.