By Colonel Rohit Dev, Founder and managing director, Reveille Energy
The world has embarked on an energy transition to tackle climate change, cut greenhouse gas emissions, and build a sustainable future. While smaller developed nations aim for earlier targets, India has set an ambitious goal of net-zero by 2070. Unlike other renewable sectors with established logistics systems, bioenergy faces unique challenges—especially upstream, where moving feedstock from farm to factory is largely unstructured, and downstream, where transporting gases and liquids poses safety and environmental risks.
A robust, technology-driven logistics and supply chain framework is critical, particularly for bioenergy, which directly supports rural development and circular economies. With the Global Biofuels Alliance (GBA) launched during India’s G20 leadership, bioenergy has moved to the center stage, though its biomass supply chain remains one of the toughest challenges for logisticians.
Framing the bioenergy space
The bioenergy space is anchored in biomass supply chain management (SCM), starting in rural areas and extending to industrial and urban midstream hubs. While upstream remains largely unstructured, technological progress is enabling advanced biofuels and biomaterials. However, storage, transport, and handling challenges persist, making logistics a critical area for refinement and scale-up.
Peculiarities of logistics in bioenergy space
The logistics in Bioenergy Space is in a ‘Time Continuum’ as operations are perennial and involve all steps of Upstream Logistics in each cycle or season. Unlike solar in which panels once installed, need replacements only over time. But, bioenergy facilities require a steady, recurring supply of biomass. For instance, a boiler consuming 80,000 MT annually or a biofuel plant using 120,000 –300,000 metric tonnes (MT) must secure that volume every year, making logistics a perpetual and resource-intensive process.
Bioenergy logistics spectrum
The bioenergy logistics spectrum spans three stages. Upstream, where biomass is sourced from agricultural, forest, municipal, industrial, and household waste. Building a supply chain require mapping, collection, storage, and mechanised aggregation. Most storage still happens in open spaces, causing losses, while residues are processed into briquettes, pellets, and other products. Midstream focuses on storage and warehousing with close monitoring of feedstock quality, supported by efficient stacking, segregation, and machinery for loading, weighing, and environmental control. Downstream covers transportation, warehousing, last-mile delivery, waste handling, and pipelines for biofuels, which demand significant investment and public–private partnerships (PPPs).
Major challenges in bioenergy logistics spectrum
The ‘Farm to Factory’ connect of the bioenergy space has many challenges.
- Most Indian farms are small and fragmented, making aggregation difficult. Unlike large farms abroad, manual practices dominate, while modern post-harvest machinery remains unaffordable due to high costs.
- Farmers cannot store biomass as land is needed to sow the next crop, and warehousing along the farm-to-factory route is limited.
- Finance schemes are scattered, with small farmers unable to access loans due to high borrowing costs.
- Absence of clear land zoning for biomass projects leads to aggregation issues and failed projects as the sector scales.
- Farmers are treated as vendors rather than stakeholders, reducing their incentives and leading to practices like stubble burning.
- Awareness of bioenergy opportunities is limited, while misinformation further weakens adoption.
- Research and development (R&D) cycles for both upstream and downstream logistics remain underdeveloped, slowing technology adoption.
- Policy-making often excludes domestic experts, relying on foreign consultants that delay implementation and favor larger players.
- Lack of standards for biomass quality and SCM also creates inefficiencies and corruption.
- Biomass supply is seasonal—short in the north but longer in the south and east—requiring localised, decentralised energy hubs to optimise costs and reduce logistics pressure.
- Many projects assume biomass availability as a given, without detailed assessments. This results in shortages, poor process flows, pilferages, and unstable cashflows later.
- Growing demand across sectors has created an acute skilled workforce gap, with poaching but no scaling of training.
- Transport is also unstructured, relying on tractors, carts, and trucks, with no dedicated systems for biomass movement.
- With energy security handled across multiple ministries and states, there is no central authority to align policies. This hampers scale-up, slows investor confidence, and weakens India’s ability to meet net zero goals.
Opportunities for logistics sector
The logistics sector has much to anticipate and much more to do to ensure a smooth energy transition and step up their game in bioenergy space.
- Huge potential exists for harvesting machinery, tractors, trolleys, and related equipment. Aggregating 100,000 MT of biomass needs about USD 3 million in capex, with value ranging between Rs 2,500–5,500 per MT. Schemes like Agriculture Infrastructure Fund
- Demand spans from carts and small vehicles to large trucks for pellets and briquettes, and specialised carriers for biofuels. Export opportunities are growing, creating prospects for shipping logistics.
- Opportunities exist across the chain—rural depots in upstream, densified biomass storage in midstream, and product storage in downstream. Mostly low-cost, land-intensive warehousing is needed, with climate-controlled storage for select products.
- Industries like cement, sugar, and infrastructure are building bioenergy portfolios. Logistics companies can benefit by integrating supply chains with their core businesses.
- Logistics players can play a critical role in reviewing the National Logistics Policy to ensure energy transition and bioenergy are adequately addressed, positioning logistics as part of national energy security.
- Wide scope for adoption of GIS mapping, predictive analytics, artificial intelligence and internet of things, robotics, drones, autonomous vehicles, blockchain, digital logistics platforms, and sensor-enabled warehousing to modernise biomass logistics.
- Large scope for training, re-skilling, and upskilling in logistics and biomass handling, driven by rapid growth of biofuels and biomass projects.
- Significant opportunities in leasing land for energy plantations, depots, storage, and related infrastructure, benefiting both states and private owners through long-term arrangements.
Recommendations for refining biomass SCM
- Place all aspects of energy security under the Union List to ensure uniform policy and implementation without federal overlaps.
- Create a coordination cell to map biomass projects, design a long-term consumption matrix, and align with the net-zero 2070 roadmap.
- Frame policies linked to sustainable development goals and Paris Accord commitments, with schemes covering finance, warehousing, transport, skilling, and farmer subsidies. Key inclusions:
- Controlled exports under a biomass EXIM policy.
- Phase down coal in small and medium boilers.
- Carbon credits to incentivise green fuel adoption.
- Dedicated schemes for energy plantations via NABARD and CAMPA funds.
- Renewable energy certificates and renewable purchase obligations to be extended to all forms of bioenergy.
- Single-window clearances and faster adoption of central policies by states.
Financial measures:
- Accord “priority sector” status to bioenergy.
- Cut borrowing costs to 4–6 per cent with 70–75 per cent debt eligibility, zero GST on upstream, and income tax holidays for 3–5 years.
- Allocate Rs 500 billion annually for projects, with majority to biofuels.
- Relax credit rating and collateral requirements; promote equity funding through Indian Renewable Energy Development Agency Limited, National Investment and Infrastructure Fund, and private equity funds.
- Ensure farmer benefit through profit plough-back and corporate social responsibility driven rural development.
- Establish biomass depots and state-of-the-art warehousing via National Bank for Agriculture and Rural Development, National Agricultural Cooperative Marketing Federation of India Ltd., and PPP models.
- Boost awareness through media, seminars, and annual conclaves; scale up skilling, reskilling, and PPP-led workforce development.
- Encourage collaborations under Make in Indiafor harvesting machinery, membranes, and other equipment to reduce imports, generate jobs, and make India a hub for exports to Africa and Global South.
- Launch PMO-monitored pilots within three years, supported by inter-ministerial groups and free land allocation by states.
- Develop state-level digital biomass platforms with national reach. Establish a Bioenergy Commission of India to oversee biomass and biofuels.
- Designate command areas and scale up energy plantations to avoid biomass scarcity as demand rises.
- Promote research in logistics, supply chain, and compressed biogas (CBG) through partnerships with global agencies (World Bank, JICA, IFC, among others). Strengthen bilateral collaborations with USA, EU, Israel, Japan, and others.
Innovative solutions:
- Consumer-based financing to lower costs.
- Optimise by-products for circular economy benefits.
- Village-as-a-Hubmodel to make farmers and communities active stakeholders.
- Refined finance and costing models adapted to agricultural seasonality and supply chain risks.
- Explore woody biomass imports for boilers to free agri-residue for higher-value uses like CBG.
- Define biomass logistics standards, emission norms, and carbon credit mechanisms in line with global best practices but tailored to India.
- Use GBA as a platform for best practices, finance, and market development. India, with its scale and demand, can become the fulcrum for global biofuels growth, especially in logistics, warehousing, blockchain, and sustainable aviation fuels.
Conclusion
The real and visible challenge in energy transition roadmap will be bioenergy space, including biofuels where upstream and downstream logistics is the bugbear to tackle effectively and that could be done with focused policy advocacy, curated and blended finance, technology adoption, best practices sharing, and with constant ideation to find solutions as stakeholders.
Energy transition, as per the stipulated timelines, pledged by major world economies and India are both a promise and a challenge and with carefully crafted energy transition roadmaps, with a due infusion of technologies, R&D and processes refinements, it is feasible to achieve the laid down targets in a more efficient manner. Logistics considerations, processes, plans and allied subjects will play a key role in the entire value chain as its cost has a more significant impact on domains like bioenergy space including biofuels, bio-incineration and other usage of biomass.
