Niti Aayog plans to set up a Methanol Economy Fund worth Rs 4,000-5,000 crore to promote production and use of the clean fuel. The government think is aiming at generation of the fuel by converting high ash content coal into methanol and such a plant is expected to be set up by Coal India.
Methanol can be used as an energy producing fuel, transportation fuel and cooking fuel, cutting down India’s oil import bill by an estimated 20 per cent over the next few years, he said. Niti Aayog plans to move a Cabinet note soon on the methanol economy and the plans to set up production plants. It expects that two plans can be commissioned in the next 3-4 years.
The Aayog is also working on converting certain diesel-powered rail engines to work on methanol. Plans are underway to ensure that boats and ships used in the inland waterways initiative are also run on methanol. The Aayog is in discussion with companies such as Volvo and Tata to produce buses running on methanol.