The Indian Biogas Association (IBA) has suggested that compressed biogas (CBG) must make up at least 10% of India’s total gas mix by 2025 and 20% by 2030 to help reduce annual import bills by up to $25bn by 2030. The IBA urged the petroleum and natural gas ministry to extend the CBG-CGD (city gas distribution) synchronisation scheme for at least a decade to offer long-term certainty to CBG firms and support investment decisions.
The industry body suggested gradually increasing the share of CBG will ensure guaranteed offtake and a transparent ecosystem for CBG producers.
For instance, it stated that the ethanol blending programme in petrol has gone up from 1.5 per cent in 2014 to 10 per cent now.
IBA stated that the relaxed domestic ‘gas pricing move’ must go hand-in-hand with the environmental sustainability goals set by the renewable energy ministry — 45 per cent reduction in emission intensity by 2030 and net-zero emission
Particularly for the CBG industry, wherein the offtake price of CBG is benchmarked to its closest substitute, CNG (Compressed Natural Gas), the move turns out to be a deterrent, it stated.
For the CBG industry, it is like taking one step backward after a few forward moves like exemption of central excise duty on the onward sale of CBG blended with CNG; resumption of the MNRE subsidy programme; introduction of the BIS standards on design, construction, and
The CGD companies claim to have been heavily bled with regard to margins in the previous few months, owing to higher domestic gas prices. Amid the global uncertainty, the domestic gas price rose to USD 8 per MMBTU from USD 1.6 per MMBTU(Million British Thermal Units) last year.
The procurement price gap of CBG and domestic gas shall widen further, it opined.
In addition, under the CGD-CBG synchronization scheme formulated by gas utility major GAIL (India) Ltd, the pricing associated with compression charges and transport charges over and above the UBP (uniform base price) of CBG is Even more concerning for the CGD players who are willing to procure CBG into its gas mix, it stated.