Bioenergy provides a clean alternative to meet the energy needs by using naturally sourced green feedstock. Although the country’s bioenergy target for 2022 has been met, there is still a large untapped potential present. There has been steady growth in biomass-based power even though it has been largely overshadowed by the more dynamic solar and wind segments. There are a number of challenges facing the bioenergy segment. But there are also emerging avenues for use, including overarching fuel use for transportation and co-firing in coal power plants, making them relatively cleaner.
Renewable Watch takes a look at the current scenario, key developments over the past year and the future outlook for the bioenergy segment…
Current scenario
The total installed biopower capacity in India stood at 10,577.45 MW as of October 2021, up by over 200 MW in November 2020 and beyond the MNRE target of 10,000 MW. This comprises 9,403.56 MW of biomass bagasse cogeneration, 772.05 MW of non-bagasse biomass and 401.84 MW of waste-to-energy (WtE). Overall, bioenergy makes up about 10.26 per cent of the total renewable energy capacity in India, excluding large hydropower.
Maharashtra, Uttar Pradesh, Karnataka and Tamil Nadu have the highest capacities of biopower and together make up al-most 75 per cent of the total biopower in the country. Most of this capacity consists of projects based on bagasse cogeneration. Further, of the agriculture-heavy states, only Uttar Pradesh features amongst the top five. Thus, there is a lot of untapped biomass potential in states such as Punjab and Haryana. Many farmers in the northern states of Haryana, Punjab and parts of Uttar Pradesh resort to stubble burning. However, there is another, more environmentally friendly way to dispose of this crop residue, that is, to use it as biomass fuel in power production. Punjab and Haryana are working to adopt strategies to avoid stubble burning. These strategies include presenting paddy straw as a resource, which can create value for the industry and the farming community. There have been efforts to make biopower tariffs more viable in these states.
Programmes to support bio-based power
Various programmes have been introduced to provide frameworks for setting up bioenergy projects. Central financial assistance (CFA) is offered for supporting programme implementation, information dissemination and training. The two main schemes introduced for promoting the installation of off-grid and decentralised biogas plants are the New National Biogas and Organic Manure Programme and the Biogas-based Power Generation (Off-grid) and Thermal Energy Applications Programme.
The government has also been implementing a scheme to support the promotion of biomass-based cogeneration in sugar mills and other industries. The scheme was applicable for projects set up across India. The scheme was notified in May 2018 and was valid till March 2021, with consideration for extension. Under the scheme, CFA of Rs 2.5 million per MW of surplus exportable capacity for bagasse cogeneration projects and Rs 5 million per MW of installed capacity for non-bagasse cogeneration projects was provided to plants utilising biomass like bagasse, agro-based industrial residue, crop residue, wood produced through energy plantations, weeds, and wood waste produced in industrial operations.
The United Nations Industrial Development Organization (UNIDO) and the MNRE have collaborated for the UNIDO-MNRE project, “Organic Waste Streams for Industrial Renewable Energy Applications in India”. The project aims to scale up innovative industrial organic WtE biomethanation technologies and business models. In February 2021, UNIDO invited bids from companies or consortiums of companies to set up biomethanation projects showcasing specific developments in one or more areas of innovation.
Co-firing of biomass with coal
In addition to purely biomass-based power plants, biomass pellets and briquettes can be used in co-firing of coal plants. Some share of biomass-based fuel can be accommodated in coal plants without much modification to the technology. Co-firing of biomass with coal has proven successful. In line with this, the greater uptake of briquettes and pellets can help reduce the reliance on coal.
Earlier, in 2017, the Ministry of Power had issued a policy on biomass utilisation for power generation through co-firing in coal-based power plants. The policy was modified and issued on October 8, 2021 as the “Revised Policy for Biomass Utilization for Power Generation through Co-firing in Coal-based Power Plants”. As per the revised policy, it has been mandated that all thermal power plants will use a 5 per cent blend of biomass pellets along with coal with effect from one year of the date of issue of this guideline. The obligation will increase to 7 per cent two years after the date of issue of this order and thereafter. For plants that have a ball and tube mill, the use of biomass will remain 5 per cent. Under the policy, it is advised that the minimum contract period for the procurement of biomass pellets by generating utilities should be seven years to avoid delays in the award of contracts and to build a long-term supply chain.
At the state level, Haryana, Punjab and Uttar Pradesh plan to procure a total of about 1,301,000 tonnes of biomass pellets for co-firing in their power plants. In September 2021, the Punjab State Electricity Regulatory Commission ruled that power generated from co-firing of biomass will be considered as renewable energy and eligible for meeting the non-solar renewable purchase obligation of the obligated entities. In the same month, the Odisha Electricity Regulatory Commission ruled that the guidelines prescribed by the Central Electricity Regulatory Commission must be followed to estimate the electricity generated from biomass in coal-based thermal plants, including captive and cogeneration projects.
NTPC has also taken the initiative to procure and use biomass-based fuel in its power plants across various states. NTPC placed an order for 865,000 tonnes earlier in the year. It placed an additional order of 65,000 tonnes in October 2021. Another tranche for the procurement of 2,500,000 tonnes is in progress, for which the vendors were invited to submit an offer by November 1, 2021.
The Ministry of Power has set up the National Mission on the Use of Biomass in Coal-based Thermal Power Plants, to address the issue of air pollution due to farm stubble burning and to reduce the carbon footprint of thermal power generation. As a result of the efforts, around 1,400 tonnes of biomass was fired in October 2021 and a total 53,000 tonnes of biomass has been utilised as green fuel in power plants so far.
Liquid biofuels
The government has taken various steps towards achieving 20 per cent blending of ethanol in petrol, which includes allowing the use of sugarcane and foodgrains for conversion to ethanol. These initiatives include an administered price mechanism for the procurement of ethanol under the Ethanol Blending Programme (EBP) with an enhanced ex-mill price of ethanol year on year, starting from ethanol supply year 2017; reduction in the GST rate to 5 per cent on ethanol under EBP; amendment in the Industries (Development & Regulation) Act for free movement of ethanol; as well as the introduction of the interest subvention scheme for enhancement and augmentation of the ethanol production capacity in the country. The average ethanol blending percentage in petrol for the ongoing Ethanol Supply Year 2020-21 is 8.04 per cent as of August 2021. Meanwhile, the percentage of blending of biodiesel in diesel is less than 0.1 per cent. The National Policy on Biofuels prescribes a target of 5 per cent blending of biodiesel in diesel by 2030.
Over the past few years, the availability of biodiesel has been low due to the increase in price and non-availability of feedstock for biodiesel. Some biodiesel is also being marketed by agencies other than oil marketing companies (OMCs). Further, to increase the supply of biodiesel in the country, OMCs are regularly inviting expressions of interest to encourage the production of biodiesel from used cooking oil.
Waste-to-energy
In August 2018, the ministry approved the Programme on Energy from Urban, Industrial and Agricultural Wastes/Residues for the period 2017-18 to 2019-20. The programme aims to promote the development of projects for the generation of biogas, bio-CNG and power from urban, industrial and agricultural waste. In March 2020, the MNRE issued revised guidelines for the programme. The revised guidelines seek to promote biomass gasifiers for either feeding electricity into the grid or meeting the captive and thermal needs of villages and industries such as rice mills. Biomethanation projects based on any kind of biodegradable waste are now eligible for CFA. However, such projects can use only segregated or uniform biodegradable waste. The MNRE is promoting various technologies for setting up WtE projects. These technology options are for the recovery of energy in the form of biogas and bio-CNG, and electricity from agricultural, industrial and urban waste.
Outlook
As per the MNRE, India has the potential to generate around 18,000 MW of renewable energy using biomass and an additional 7,000-8,000 MW from bagasse cogeneration. The segment offers a huge opportunity for agricultural waste management, curtailment of air pollution, preventing loss of fertility of agricultural land and providing a sustainable income source for farmers, suppliers and biomass fuel manufacturers resulting in overall development.
However, owing to inefficient management of biomass, high capital requirement for biomass projects and technological barriers in terms of energy conversion, the bioenergy segment remains far from reaching its potential.
By Meghaa Gangahar
