With urban India generating high volumes of municipal solid waste (MSW) and agricultural waste, the role of waste-to-energy (WtE) and compressed biogas (CBG) projects in addressing both waste management and energy security is receiving growing policy and industry attention. While several projects have been commissioned across the country, developers continue to face challenges related to feedstock quality, segregation at source, financing constraints and regulatory implementation. At the Solid Waste Management in India conference organised by Renewable Watch, industry leaders discussed the operational realities of WtE and CBG projects in India. Edited excerpts…
Tarun Joshi
Jindal Urban Infrastructure Services has been active in India’s WtE sector for more than a decade and a half, operating several plants across multiple states. The company was among the early developers involved in establishing large-scale WtE projects in India, including one of the country’s earliest successful facilities, in Okhla, Delhi.
The company currently operates six plants across Delhi, Andhra Pradesh, Rajasthan and Gujarat, with seven new facilities and expansion projects under implementation. The Tekhand facility in Delhi has a capacity of around 25 MW and processes approximately 2,000 tonnes per day (tpd) of MSW. It operates on a land parcel of roughly 15 acres, which is sufficient for the scientific processing and disposal of up to 3,000-3,500 tonnes of waste after expansion. We are currently targeting the execution of two to three WtE projects over the next one to two years. Our capacity can be expected to grow twofold over the next two years as additional projects in the pipeline are commissioned.
Feedstock characteristics vary considerably across cities, which affect plant performance and processing requirements. Waste generated in metropolitan areas differs significantly from that collected in smaller cities, both in composition and moisture content. However, in large urban centres such as Delhi, waste availability remains strong. The city generates roughly 12,000 tpd of municipal waste, of which we process about 4,000 tpd. This stable feedstock supply enables the plants to maintain high operating performance levels. As a result, we have been maintaining a plant load factor of around 90 per cent for the past six to seven years. The revenue structure and competitive tariffs for WtE projects vary across cities and the business models adopted. Most of our projects are tariff-based. There are broadly three parameters that impact the business model: electricity tariffs, tipping fees paid by municipalities, and viability gap funding support from the government. In Delhi, electricity generated by WtE plants is primarily purchased by discoms under long-term power purchase agreements that typically extend for 20-25 years.
Project economics are also influenced by plant size. The capital cost per unit of electricity varies significantly depending on the capacity of the facility. For large plants, average costs can be approximately Rs 200 million-Rs 250 million per MW, whereas smaller plants in the 10-15 MW category may see costs rise to Rs 300 million per MW due to reduced economies of scale. Additional infrastructure requirements, such as engineered sanitary landfills or specialised waste handling facilities, can further increase capital expenditure. The operational cost structure of WtE plants also includes substantial expenditure on emissions control and environmental compliance. Flue gas treatment and wastewater management form a significant portion of the operating cost.
Project scale and waste aggregation are critical for expanding WtE capacity beyond major metropolitan areas. Facilities can be developed for medium-sized cities or clusters of neighbouring urban centres. By aggregating waste from two or three nearby municipalities, plants can operate efficiently even with 600-700 tpd of waste, a model currently being implemented in cities such as Jodhpur.
Since the earliest WtE projects in India were commissioned only in the past decade, most plants have not yet completed a full concession cycle. Some of the first facilities in the country are expected to approach the completion of their initial operational period around 2037. In terms of cost structure, first-year operations and maintenance expenditure for WtE plants generally ranges between 6 and 8 per cent of the initial capital cost. This cost increases gradually over time due to inflation in material and labour expenses. Material costs typically increase by around 2-5 per cent annually, while manpower costs tend to rise at a faster pace, often in the range of 10-12 per cent per year. Operational excellence, therefore, becomes critical for improving cost efficiency. India’s Solid Waste Management Rules have evolved significantly since their introduction in 2000 and continue to expand in scope. However, translating these frameworks into actionable guidelines for municipal authorities remains an ongoing challenge. In many cases, Government bodies lack clear implementation instructions, which slows the pace of project development.
Siddhant Srivastava
Ever Enviro Resource Management is a relatively new entrant in the waste management sector but has expanded rapidly since its establishment in 2017-18. Backed by private equity investors, the company strengthened its market presence through the acquisition of several Infrastructure Leasing & Financial Services waste management assets in 2020, including collection and transportation contracts in Delhi and construction and demolition waste projects in Delhi and Varanasi.
The company has also focused heavily on developing CBG projects. Currently, Ever Enviro operates six plants across northern India – two in Punjab, three in Uttar Pradesh, and one in Madhya Pradesh. We have also signed a contract with the Indore Municipal Corporation for a CBG project. We are generating around 60-70 tpd of CBG, utilising around 1,200-1,300 tpd of organic waste across our projects. These plants process a range of feedstocks, including cattle waste, agricultural residues and municipal organic waste. Over the next two years, waste processing capacity across our facilities is expected to double as additional projects and expansions come online.
Feedstock characteristics play a crucial role in determining the efficiency of the CBG plant. Among various inputs used in biogas production, agricultural residues such as paddy straw deliver the highest conversion efficiency due to their high carbon content and low moisture levels. Paddy straw has a conversion rate of around 10-12 per cent. In comparison, municipal organic waste typically produces lower yields, averaging around 3.5-4.5 per cent, due to its heterogeneous composition. CBG produced at these facilities is sold primarily to city gas distribution companies. In Indore, for example, the plant injects gas directly into the city’s distribution pipeline after an initial phase where CBG was transported through cascades to nearby customers. This pipeline integration has improved operational efficiency and enabled direct supply into the gas grid.
Project economics in the CBG sector depend significantly on feedstock pre-processing costs. While the core digestion and gas upgrading processes remain similar across projects, pre-processing requirements vary depending on the type of feedstock used. Capital costs for CBG plants typically range between Rs 60 million and Rs 90 million per tpd of CBG output. Smaller plants generally experience higher per-unit costs due to reduced economies of scale. Financial viability remains a challenge for many projects. Early plants in the sector were financed largely through equity due to limited lender familiarity with the technology. When the Indore project was first implemented, nearly 80 per cent of the capital investment was funded through equity, with only 20 per cent coming from bank financing. As the sector has matured and operational experience has accumulated, financing conditions have improved, with newer projects achieving debt-equity ratios closer to 70:30.
The administered CBG price currently corresponds to roughly 85 per cent of the average retail compressed natural gas price. Achieving even this level required extensive engagement with policymakers, as earlier benchmarks were significantly lower. To improve financial viability, projects are increasingly being structured as integrated biorefineries rather than standalone CBG plants. This approach ensures that all incoming waste streams are utilised to generate additional value. For example, long-fibre materials such as coconut residues, horticultural waste and banana waste are now being evaluated for conversion through torrefaction processes to produce torrefied biomass or biochar, which can be sold as a separate product stream. Such interventions are aimed at unlocking additional revenue potential beyond gas sales. In addition, by-products such as solid and liquid fertilisers generated during the digestion process can be sold in agricultural markets, often with support from government subsidy programmes. Furthermore, some facilities are exploring carbon credit markets to monetise emission reductions. The Indore plant, for instance, has obtained certification under international carbon standards, enabling the company to generate additional revenue through carbon credit trading.
The sector’s growth will depend on two critical factors: long-term feedstock assurance and reliable offtake agreements. Developers require predictable supply chains and stable demand frameworks to confidently invest in new facilities.
