The Union Cabinet, chaired by the Prime Minister Shri Narendra
Modi has approved National Policy on Biofuels – 2018.
Salient Features:
i.
The Policy categorises
biofuels as "Basic Biofuels" viz. First Generation (1G) bioethanol
& biodiesel and "Advanced Biofuels" - Second Generation (2G)
ethanol, Municipal Solid Waste (MSW) to drop-in fuels, Third Generation (3G)
biofuels, bio-CNG etc. to enable extension of appropriate financial and fiscal
incentives under each category.
ii.
The Policy expands the
scope of raw material for ethanol production by allowing use of Sugarcane
Juice, Sugar containing materials like Sugar Beet, Sweet Sorghum, Starch
containing materials like Corn, Cassava, Damaged food grains like wheat, broken
rice, Rotten Potatoes, unfit for human consumption for ethanol production.
iii.
Farmers are at a risk
of not getting appropriate price for their produce during the surplus
production phase. Taking this into account, the Policy allows use of surplus
food grains for production of ethanol for blending with petrol with the
approval of National Biofuel Coordination Committee.
iv.
With a thrust on
Advanced Biofuels, the Policy indicates a viability gap funding scheme for 2G
ethanol Bio refineries of Rs.5000 crore in 6 years in addition to additional
tax incentives, higher purchase price as compared to 1G biofuels.
v.
The Policy encourages
setting up of supply chain mechanisms for biodiesel production from non-edible
oilseeds, Used Cooking Oil, short gestation crops.
vi.
Roles and
responsibilities of all the concerned Ministries/Departments with respect to
biofuels has been captured in the Policy document to synergise efforts.
Expected Benefits:
- Reduce Import Dependency: One crore lit of E10 saves Rs.28 crore of forex at
current rates. The ethanol supply year 2017-18 is likely to see a supply
of around 150 crore litres of ethanol which will result in savings of over
Rs.4000 crore of forex.
- Cleaner Environment: One crore lit of E-10 saves around 20,000 ton of CO2 emissions.
For the ethanol supply year 2017-18, there will be lesser emissions of CO2 to
the tune of 30 lakh ton. By reducing crop burning & conversion of
agricultural residues/wastes to biofuels there will be further reduction
in Green House Gas emissions.
- Health benefits: Prolonged reuse of Cooking Oil for preparing food,
particularly in deep-frying is a potential health hazard and can lead to
many diseases. Used Cooking Oil is a potential feedstock for biodiesel and
its use for making biodiesel will prevent diversion of used cooking oil in
the food industry.
- MSW Management: It is estimated that, annually 62 MMT of Municipal
Solid Waste gets generated in India. There are technologies available
which can convert waste/plastic, MSW to drop in fuels. One ton of such
waste has the potential to provide around 20% of drop in fuels.
- Infrastructural Investment in
Rural Areas: It is estimated that, one
100klpd bio refinery will require around Rs.800 crore capital investment.
At present Oil Marketing Companies are in the process of setting up twelve
2G bio refineries with an investment of around Rs.10,000 crore. Further
addition of 2G bio refineries across the Country will spur infrastructural
investment in the rural areas.
- Employment Generation: One 100klpd 2G bio refinery can contribute 1200 jobs
in Plant Operations, Village Level Entrepreneurs and Supply Chain
Management.
- Additional Income to Farmers: By adopting 2G technologies, agricultural
residues/waste which otherwise are burnt by the farmers can be converted
to ethanol and can fetch a price for these waste if a market is developed
for the same. Also, farmers are at a risk of not getting appropriate price
for their produce during the surplus production phase. Thus conversion of
surplus grains and agricultural biomass can help in price stabilization.
Background:
In order to promote biofuels in the country, a National Policy
on Biofuels was made by Ministry of New and Renewable Energy during the year
2009. Globally, biofuels have caught the attention in last decade and it is
imperative to keep up with the pace of developments in the field of biofuels.
Biofuels in India are of strategic importance as it augers well with the
ongoing initiatives of the Government such as Make in India, Swachh Bharat
Abhiyan, Skill Development and offers great opportunity to integrate with the
ambitious targets of doubling of Farmers Income, Import Reduction, Employment
Generation, Waste to Wealth Creation. Biofuels programme in India has been largely
impacted due to the sustained and quantum non-availability of domestic
feedstock for biofuel production which needs to be addressed.
