India’s Biogas Sector Gains Momentum: Driving Clean Energy Goals and Economic Growth Nishant Krishna April 4, 2024

India’s Biogas Sector Gains Momentum: Driving Clean Energy Goals and Economic Growth

India generates approximately 62 million metric tonnes of municipal solid waste (MSW) annually, alongside a surplus availability of around 230 million metric tonnes of agricultural biomass.

India has inaugurated the ambitious SATAT scheme, aimed at fostering indigenous production of compressed biogas (Bio CNG) from biodegradable waste. However, the scheme’s full realization is yet to be achieved. India generates approximately 62 million metric tonnes of municipal solid waste (MSW) annually, alongside a surplus availability of around 230 million metric tonnes of agricultural biomass. The Government of India unveiled the Panchamrit initiative during the COP 26 in Glasgow in 2021. Its fundamental objectives encompass reaching a Non-fossil energy capacity of 500GW by 2030, ensuring that 50% of energy production is derived from renewable sources, reducing total projected carbon emissions by one billion tonnes from the present to 2030, and decreasing the carbon intensity of the economy by 45% by 2030, relative to 2005 levels. Additionally, the initiative aims to attain the target of net zero emissions by 2070. The production of CBG from waste is certain to help with attaining the goals of Panchamrit initiative.

Moreover, a series of policies aimed at bolstering the biogas sector have facilitated a notable upsurge in India. Below, we delineate five primary driving forces behind this momentum:

National Bioenergy Program: The national bioenergy program, endowed with an initial allocation of INR 858 Crore in its inaugural phase and a cumulative budget outlay of INR 1715 Crore, is strategically designed to furnish financial support for the establishment of both large Compressed Biogas (CBG) plants and small-scale biogas and biomass facilities. Scheduled until March 2026, the program has catalyzed the establishment of numerous CBG and biogas plants across the nation. Furthermore, states such as Uttar Pradesh are augmenting this initiative by offering supplementary subsidies of commensurate value. In essence, under the National Bioenergy Program (NBP), a subsidy of up to INR 10 Cr is attainable for a CBG plant boasting a capacity of 12 TPD CBG. It’s noteworthy that the subsidy disbursement is contingent upon performance metrics.

FCO recognition of Fermented organic manure: The digestate produced by CBG plants serves as a highly effective soil conditioner, recognized as fermented organic manure (FOM) following amendments to the Fertilizer Control Order in 2021 and 2022. FOM holds significant potential in enhancing soil fertility by augmenting its organic content, particularly crucial in the context of India’s declining Soil Organic Carbon (SOC) levels. Over the decades, India has witnessed a notable reduction in SOC, plummeting from 1% in the 1950s to a recent low of 0.3%.

MDA on Fermented organic manure:

In addition to the acknowledgment of digestate as Fermented Organic Manure (FOM), an extra subsidy of INR 1500 per tonne is being extended for the sale of FOM. Moreover, fertilizer manufacturing and marketing companies have the opportunity to engage in agreements for the marketing of FOM produced by CBG plants.

CBG blending obligation:

To streamline the uptake of CBG generated by CBG plants nationwide, the National Biofuels Coordination Committee (NBCC) has sanctioned the phased implementation of mandatory blending of CBG in both the CNG (Transport) and PNG (Domestic) segments of the CGD (City Gas Distribution) sector. The process entails a gradual increase in CBG blending in CNG, escalating from 1% to 4% of the total CNG consumed for the fiscal years 2026 to 2028, respectively. Eventually, the blending ratio is set to stabilize at 5% from the fiscal year 2028-29 onwards. This strategic initiative is poised to address CBG off-take challenges encountered by CBG entrepreneurs, diminish CNG imports, and foster the advancement of a gas-based economy.

Ex-situ crop residue management guidelines:

The operational guidelines for the efficient ex situ management of crop residue in the states of Punjab, Haryana, Uttar Pradesh, Madhya Pradesh, and the National Capital Territory of Delhi have been unveiled as a pivotal component of the Rashtriya Krishi Vikas Yojana . These guidelines are strategically devised to mitigate the practice of crop residue burning, advocating for the mechanized handling of crop residue, and establishing a robust crop residue supply chain to facilitate alternative uses. Moreover, the guidelines are geared towards fostering awareness and promoting effective crop residue management practices. Additionally, the Union Budget has earmarked financial support for the procurement of machinery aimed at crop residue management, underscoring the government’s commitment to addressing this pressing agricultural challenge.

India is fostering a conducive environment for the burgeoning Compressed Biogas (CBG) ecosystem, thereby enticing major conglomerates such as Reliance and Adani, alongside numerous new entrants, to invest in the sector. Remarkably, the CBG domain, which was previously overlooked, has experienced unprecedented growth over the past 3-4 years. Presently, approximately 81 CBG plants are operational, with an additional 504 plants in various stages of development, of which approximately 150 are currently under construction. The promotion of CBG is poised to not only facilitate effective solid waste management and curb greenhouse gas emissions but also foster the adoption of clean energy practices while concurrently reducing import bills. This concerted effort aligns with India’s overarching clean energy objectives and is anticipated to generate a multitude of employment opportunities. Furthermore, it promises to enhance the livelihoods of farmers by providing them with an additional revenue stream.

Read more at: