BPCL Turns Refining Efficiency Into Its First Climate Strategy
The state refiner is betting on efficiency, biofuels and green hydrogen to decarbonise without ditching oil.
The Gist
Bharat Petroleum Corporation Limited (BPCL) is redefining its role in the energy sector by integrating traditional fossil fuels with green energy solutions.
- BPCL aims for a multi-fuel ecosystem focused on rapid decarbonisation.
- The company has achieved a 20% ethanol blending rate and is expanding its biofuel initiatives.
- BPCL is investing in green hydrogen and petrochemical projects to enhance sustainability and reduce emissions.
State-owned Bharat Petroleum Corporation Limited (BPCL) is betting on a multi-fuel ecosystem focused on rapid decarbonisation as oil is being increasingly looked at as a sunset industry.
Speaking on the company's strategic evolution since COP 26, Sanjay Khanna, Director of Refineries, told The Core in the run-up to India Energy Week about a transition where traditional fossil fuels and emerging green energies do not just compete but coexist to meet India’s growing demand.
Efficiency In The Core
The company’s first line of defence against emissions remains its refining operations. Khanna noted that significant gains are being made simply through operational "trimming" and improving the efficiency of existing infrastructure.
"We know that 10 to 15% energy reduction possibility is there by just by trimming by taking the action and reduction of the fuel or improving the efficiency of the refineries," Khanna stated.
These efforts were recently validated by a Solomon Benchmark study, which confirmed a significant reduction in emissions across BPCL refineries over the past year.
The Ethanol Milestone
BPCL has also hit a critical target in biofuel adoption. For the last two months, the refiner has consistently achieved a 20% ethanol blending rate, a key government mandate. This success is supported by the commissioning of a 1G plant at Bargarh, with a 2G plant expected to come online as early as this month.
Khanna emphasised that the shift in the energy landscape requires a responsible approach to CO2 emissions, making decarbonisation a "topmost priority" for the firm.
Green Hydrogen And Scaling Costs
Perhaps the most ambitious leg of the strategy is green hydrogen. Following the commissioning of a 5-megawatt electrolyser plant at Bina, BPCL is now looking toward massive scale-up. The company has already ordered a 5,000-tonne-per-annum facility under the government’s "site to be" scheme at highly competitive rates.
Khanna highlighted the rapid decline in technology costs, noting that newer projects are significantly cheaper than earlier pilots.
Petrochemical Expansion And Future Fuels
A major pillar of BPCL's 2026 outlook is its 50,000-crore mega petrochemical project at Bina, scheduled for completion in mid-2028. The company is also investing 15,000 crore in a new cracker unit in Mumbai to increase its petrochemical intensity to over 20%.
Beyond traditional fuels, BPCL is exploring isobutyl alcohol as a potential diesel additive, which could make India a global pioneer in this space.
"India may be the first country in the world who will be adding [isobutyl alcohol] to diesel but I will say lots... has to be long way to go," Khanna cautioned, noting the technology is still in preliminary stages.
Khanna emphasised that BPCL is increasingly looking toward indigenous technology and local manufacturing to reduce dependency on Western systems.
"What I'm trying to say that the the two year time we are seeing the reduction in the cost and I'm pretty sure the more and more scale up of the facility will be there the price is going to go down in the time to come," Khanna said.
He concluded by noting that while COP 26 may have initially cast a shadow over the sector, the current reality is one of evolution.
"It becomes very clear that every form of energy has to coexist and it's a matter of time only that some energy will get evolved more than other," he added.
With a target of 10 gigawatts of renewable energy by 2040, BPCL is betting that its "Project Aspire" strategy will successfully bridge the gap between today’s oil dependency and tomorrow’s net-zero requirements.
