India’s Green Future through BioCNG

BIOCNG

Syllabus
GS Paper 3 – Conservation, Environmental Pollution and Degradation, Environmental Impact Assessment.

Context
The Hindu editorial based on “Biogas can fuel a green economy”


A few years ago, the Kaira District Co-operative Milk Producers Union Limited, also known as Amul Dairy, pioneered a new initiative in India’s food industry by launching a fully automated bio-CNG generation and bottling plant. This innovative plant was designed to harness energy from the waste produced at the dairy.

Following the successful implementation of its BioCNG pilot project at Banas Dairy in Gujarat, Amul is now planning to expand this initiative. The company is considering the establishment of four additional plants in Banaskantha, with an investment of ₹230 crore. The execution of these bioCNG projects by Amul signifies a significant shift towards a circular economy.

BioCNG, also referred to as biomethane, is a type of renewable and clean fuel used for transportation. It is produced by enhancing the quality of biogas to match that of natural gas. Essentially, BioCNG is a purified form of biogas, which is derived from various organic waste materials. These include agricultural waste such as crop residues, straw, and manure, food waste like spoiled food and leftover scraps, and sewage sludge, which is the solid waste from wastewater treatment plants.

  • High Calorific Value:
    • BioCNG possesses a high calorific value, implying it can generate more energy per unit volume compared to other fuels.
    • This makes it a more efficient and economical choice for various applications, such as vehicle fuel, power generation, heating, and cooking.
    • BioCNG can also serve as a replacement for liquefied petroleum gas (LPG), which has a lower calorific value and is more costly.
  • Clean Fuel:
    • BioCNG is a clean fuel that aids in controlling air pollution. It emits fewer pollutants such as carbon monoxide, nitrogen oxides, and particulate matter than gasoline or diesel.
    • These pollutants can cause respiratory problems, acid rain, smog, and climate change, posing harm to human health and the environment.
  • No Residue or Smoke:
    • BioCNG does not produce any residue or smoke, making it a non-polluting fuel. It leaves behind no ash, tar, or carbon deposits that could damage the engine and reduce its performance.
    • Therefore, BioCNG is a safer and cleaner fuel compared to other conventional fuels.
  • Economical:
    • BioCNG is economical as it can be produced locally from waste materials. This can help save on transportation and storage costs, as well as create local jobs and income opportunities.
    • BioCNG can also reduce the energy import bill, as India imports about 85% of its crude oil requirement.
    • Furthermore, BioCNG can be used as a cooking fuel in residential and commercial kitchens, as it is cheaper and cleaner than LPG.
  • Bio-Fertilizers:
    • BioCNG can also generate bio-fertilizers, which can enhance soil quality and crop yield.
    • Bio-fertilizers are organic fertilizers containing beneficial microorganisms, such as bacteria, fungi, and algae, that enhance nutrient availability and uptake by plants.
    • Bio-fertilizers can be produced from the slurry or digestate left behind after the production of BioCNG.
  • CBG Blending Obligation (CBO):
    • The government announced a phased mandatory blending of Compressed Bio-Gas (CBG) in Compressed Natural Gas (CNG) and Piped Natural Gas (PNG) segments of the City Gas Distribution (CGD) sector in October 2023.
    • The CBG Blending Obligation (CBO) aims to promote the production and consumption of Compressed Bio-Gas in the country.
  • Reduction in LNG Imports: Blending five per cent of biogas with natural gas will reduce LNG imports by USD 1.17 billion.
  • Voluntary to Mandatory Blending: The CBO will be voluntary till FY25 and the mandatory blending obligation would start from FY26. The CBO shall be kept as 1%, 3% and 4% of total CNG/PNG consumption for FY26, 2026-27 and 2027-28 respectively. From 2028-29 onwards, the CBO will be 5%.
  • Implementation:
    • The National Biofuels Coordination Committee (NBCC) is responsible for overseeing the implementation of the mandate.
    • The Ministry of Petroleum and Natural Gas (MoPNG) will provide financial assistance and other support to CGD companies.
    • The CGD companies will be responsible for blending CBG in their CNG and PNG networks.
  • Objectives: The key objectives of the CBO are to stimulate demand for CBG in the CGD sector, reduce Liquefied Natural Gas (LNG) imports, save in forex, promote a circular economy, and assist in achieving the target of net zero emission, among others.
  • Central Financial Assistance: The government provides central financial assistance for the establishment of plants that generate Biogas/Bio-CNG from urban, industrial, and agricultural waste.
  • Custom Duty Concession: There’s a concession on custom duty for the import of machinery and components required for the initial setup of projects for the generation of Power and Bio-CNG.
  • Additional Central Assistance: Additional Central Assistance is provided for Municipal Solid Wastes (MSW) based CBG plants under the Swachh Bharat Mission Urban 2.0.
  • Remunerative CBG Procurement Price: The government has set a remunerative CBG procurement price and indexed it with the CBG Retail Selling Price.
  • Policy Guidelines: Policy guidelines have been established for the co-mingling of CBG with Natural Gas in the CGD network to improve offtake.
  • Availability of Feedstock:
    • Ensuring a consistent and adequate supply of raw materials for CBG production is a challenge. This supply can fluctuate based on the season, region, and market conditions.
    • The cost of feedstock can also impact the profitability and viability of CBG projects.
    • While the government has announced various incentives and subsidies for feedstock procurement under the SATAT scheme, there are issues related to implementation and monitoring at the ground level.
  • Lack of Adequate Infrastructure and Technology:
    • The development and deployment of necessary equipment and facilities for CBG production, such as biogas digesters, compressors, purifiers, etc., pose a significant challenge.
    • Additionally, creating and maintaining the infrastructure for CBG storage, transportation, and distribution, such as pipelines, cylinders, dispensers, etc., is also a challenge.
    • The government has invited bids from entrepreneurs and investors to set up CBG plants under the SATAT scheme, but there are barriers to entry and exit, such as high capital costs, regulatory hurdles, and technical glitches.
  • Coordination and Cooperation among Various Stakeholders:
    • Creating a conducive and collaborative environment among the various actors involved in the CBG value chain, such as farmers, entrepreneurs, investors, regulators, consumers, etc., is a hurdle.
    • This also involves ensuring transparency and accountability among the stakeholders, such as compliance with quality standards, pricing mechanisms, contractual obligations, etc.
    • The government has established a Central Repository Body (CRB) to monitor and implement the blending mandate, but there may be issues of coordination and communication among the stakeholders, such as conflicts of interest and information asymmetry.
  • Awareness and Acceptance of CBG as a viable Alternative:
    • The government has launched various campaigns and initiatives to educate and encourage the public and the industry to adopt CBG, such as the Go Green campaign, the CBG logo, etc.
    • However, there may be issues of perception and preference among the consumers, such as lack of trust, inertia, and resistance to change.
  • Clearly Defined Targets and Timelines: Ensure clarity on the annual blending percentages for CNG and PNG, with incremental increases to stimulate CBG production and demand.
  • Streamlined Regulations: Simplify and expedite regulatory processes for setting up CBG plants and obtaining clearances.
  • Financial Incentives: Implement attractive subsidies, tax breaks, and feed-in tariffs to incentivize CBG production and infrastructure development.
  • Capacity Building and Infrastructure Development:
    • Technical Assistance: Provide technical support and training to potential CBG producers on technology selection, plant operation, and quality control.
    • Financial Assistance: Offer low-interest loans and grants to encourage investment in CBG plants and infrastructure.
    • Grid Integration: Develop infrastructure for injecting CBG into the existing gas grid, including compression and transportation facilities.
  • Quality Standards: Implement stringent quality standards for CBG to ensure its safe and efficient use in CNG and PNG networks.
  • Awareness and Market Development:
    • Public Awareness Campaigns: Educate the public about the benefits of CBG for environmental sustainability and energy security.
    • Industry Engagement: Collaborate with stakeholders, including CGD companies, vehicle manufacturers, and consumers, to promote CBG adoption.
    • Technology Demonstration: Showcase successful CBG projects and promote best practices to build confidence among potential investors.
  • Additional Considerations:
    • Focus on Rural Development: Promote CBG production in rural areas to create income opportunities and improve energy access.
    • Promote Feedstock Diversification: Encourage the use of diverse feedstocks, such as agricultural waste, food waste, and municipal solid waste, to ensure sustainable CBG production.
    • Address Environmental Concerns: Implement measures to mitigate the environmental impact of CBG production, such as reducing methane emissions and managing digestate sustainably.

Source: The Hindu


Practice Question

Critically examine the government’s initiative of Compressed Bio-Gas (CBG) Blending Obligation, which entails the progressive blending of Compressed Bio-Gas (CBG) in CNG and PNG. Identify the potential challenges that could arise during the implementation of the CBG Blending Obligation and provide a detailed discussion on each. (250 words)

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