As a key player in the GBA, India can enhance its energy security, drive economic growth, and strengthen its leadership in the biofuel sector while meeting its national and climate goals
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The Global Biofuels Alliance (GBA), launched during India's G20 presidency on 9 September 2023, marks a significant step towards sustainable energy transition. Initiated by India and eight other countries, including the United States (US) and Brazil, the GBA aims to increase the global use of sustainable biofuels, and cleaner and more climate-friendly alternatives to fossil fuels. To achieve this, the GBA is working to secure a more affordable supply, develop guidelines to mitigate climate change and accelerate global biofuel adoption through capacity building and technical support.
In one year, the GBA has made some strides towards worldwide fuel adoption. Led by the US, Brazil, and India, which together account for 85 percent of global ethanol production and 81 percent of consumption, the alliance has expanded to include 24 countries and 12 organisations, including the World Bank, the World Economic Forum, and the International Energy Agency. The GBA has garnered particular interest from African nations, with South Africa, Kenya, Uganda, and Tanzania joining, highlighting global recognition of biofuels as a critical alternative energy source
As global demand for biofuels is projected to increase significantly by 2028, India is well-positioned to capitalise and solidify its role as a key player in the global biofuel sector.
Biofuels are becoming increasingly crucial for reducing oil demand, especially in transport sectors where electric vehicles may not fully replace liquid fuels. As global demand for biofuels is projected to increase significantly by 2028, India is well-positioned to capitalise and solidify its role as a key player in the global biofuel sector.
The GBA presents a multifaceted opportunity for India, promising to boost national employment, economic growth, and the global expansion of Indian industries in the biofuel sector. Moreover, it aligns with India's goal of energy self-sufficiency as well as its objective of increasing ethanol blending to 20 percent (E20) by 2025. This move is expected to save India US$5.4 billion in oil imports and 63 million tonnes of oil annually, significantly enhancing its energy security and reducing import bills.
The GBA, in conjunction with initiatives like the International Solar Alliance (ISA) and the Coalition for Disaster Resilient Infrastructure (CDRI), positions India as a leader in the global fight against climate change. India's growing prominence in the biofuel sector is particularly noteworthy given China's waning focus on biofuels. While China produces significant amounts of biofuel, its national policies do not prioritise this sector, with its average fuel ethanol blend rate stagnating at 1.8 percent. This is significantly advantageous for India, both in terms of domestic energy security and potential export markets while also creating an opportunity for India to emerge as the global leader in biofuels.
India's ambitious biofuel strategy, outlined in its amended 2022 National Biofuel Policy, aims to position the country as the central player in Asia's biofuel sector. The policy sets aggressive targets, including 20 percent ethanol blending in gasoline by 2025-26 and 5 percent biodiesel blending with diesel by 2030. To achieve them, India has launched various initiatives, such as a second-generation ethanol plant by the Indian Oil Corporation and phased mandatory blending of compressed biogas in natural gas from FY 2025-26. Moreover, the government has also approved financial assistance for biomass collection, addressing supply chain challenges while encouraging industry innovation by broadening permitted feedstocks for biofuel production. Additionally, India is exploring sustainable aviation fuel, targeting 1 percent blending by 2027 and 2 percent by 2028, while also investigating innovative technologies like alcohol-to-jet and waste-to-fuel conversion.
The government has also approved financial assistance for biomass collection, addressing supply chain challenges while encouraging industry innovation by broadening permitted feedstocks for biofuel production.
The success of the GBA, however, does not depend on India alone. Brazil's 2024 G20 presidency offers a key opportunity to embed biofuels in the global energy transition framework. As G20 president, Brazil can leverage its renewable energy expertise and strong biofuel sector to lead the global energy transformation agenda, potentially boosting biofuel adoption worldwide.
Brazil’s approach includes people-centred programmes like PRONATEC and the Low-Carbon Agriculture Program, supporting forest product value chains and smallholder farmers. At COP28 in Dubai, Brazil unveiled an Ecological Transformation Plan aimed at fostering sustainable economic development and social justice. Furthermore, Brazil's National Association of Grain Ethanol Producers (UNEM) announced the commencement of operations for a new ethanol, meal, and corn oil facility in Maracaju (MS) on 1 January, further boosting the country's biofuel production capacity.
In 2024, Brazil launched the New Industry Brazil policy targeting a 50-percent increase in biofuels’ share of the transport energy mix by 2033. Brazil is also developing a Future Fuel Program to promote ethanol, biodiesel, and sustainable aviation fuel blending. Recently, Brazil's Ministry of Foreign Affairs signed a cooperation agreement with the Sugarcane and Bioenergy Industry Union to showcase hybrid-flex and flex vehicles using ethanol fuel during G20 meetings, promoting Brazilian ethanol technology in alignment with the country's G20 presidency priority of sustainable development. This initiative, coupled with Brazil's leadership in the GBA, underscores the country’s commitment to advancing biofuels as a key component of the global energy transition and sustainable development agenda.
Brazil is also developing a Future Fuel Program to promote ethanol, biodiesel, and sustainable aviation fuel blending.
These efforts, coupled with India and Brazil's leadership in the GBA, underscore their commitment to advancing biofuels as a key component of the global energy transition and sustainable development agenda.
Biofuels, while touted as a low-carbon alternative to fossil fuels, bring significant challenges including resource demands, pollution, and potential increases in greenhouse gas (GHG) emissions. Life cycle assessments (LCAs) show that GHG emissions from biofuel are highly situational, depending on production methods and feedstock type. While first-generation options often fall short of renewable energy requirements, expert-recommended second-generation biofuels show promise on both fronts; GHG reductions and energy requirements. The GBA, leveraging expertise from Brazil, India, and the US, must address these challenges by selecting appropriate technologies and funding R&D for alternative ingredients like algae and engineered microorganisms.
As the Global Biofuel Alliance (GBA) moves forward, it can draw on the valuable experiences and expertise of Brazil, India, and the US as it expands the global clean energy economy. To meet net-zero goals, production must rise by 11 percent annually this decade. To optimise the alliance’s functioning and prevent it from becoming just another G20 initiative, the GBA needs to take several steps.
Firstly, New Delhi should swiftly sign the agreement to establish a headquarters and permanent secretariat within India, thereby, giving the GBA an international legal entity status along with diplomatic privileges. Secondly, as recommended by the International Energy Agency (IEA) in its report titled Biofuel Policy in Brazil, India and the United States: Insights for the Global Biofuel Alliance, the GBA should focus on developing new and existing markets beyond the current concentration in the US, Brazil, Europe, and Indonesia.
The GBA, leveraging expertise from Brazil, India, and the US, must address these challenges by selecting appropriate technologies and funding R&D for alternative ingredients like algae and engineered microorganisms.
Given that major crude producers and consumers like China, Russia, and Saudi Arabia have not joined, the GBA must tread carefully. A well-defined charter is essential to assess the potential of countries with little to no biofuel development due to a lack of technology, expertise, or finance. The GBA should not limit its mandate to member countries but reach out to non-members as well, particularly in the Global South where bioenergy can offer a cheaper and more competitive pathway to net-zero, job creation, and rural income generation. Countries like Sudan, Ethiopia, Angola, Nepal, Guatemala, Costa Rica, and Laos present untapped potential.
To this end, the GBA can serve as a hub of expertise, providing technical knowledge and best practices while acting as a guarantor to facilitate investments and partnerships. Collaboration with financial institutions and encouragement of private companies like PRAJ, Hindustan Petroleum Corporation Limited, Eni S.p.A., and Raízen to invest in high-potential countries is also crucial. By adopting this broader approach, the GBA can catalyse global biofuel development, foster international cooperation, and maximise the economic and environmental benefits of biofuel technology worldwide, solidifying its role as a key player in the global energy transition.
Manini is a Research Intern at the Observer Research Foundation
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Manini is a Research Assistant at the Centre for Economy and Growth, ORF New Delhi. Her research focuses on the intersection of geopolitics with international ...
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