Biogas Adoption can Reduce LNG Imports

India’s energy landscape is on the brink of a transformation. A recent report by the Institute for Energy Economics and Financial Analysis (IEEFA) outlines a promising strategy to replace natural gas consumption with biogas and biomethane, ultimately aiming to achieve a 20 percent substitution rate by 2030. This shift could lead to substantial savings, cutting liquefied natural gas (LNG) import bills by USD 29 billion between financial years 2025 and 2030. In addition to economic benefits, the report underscores the environmental advantages of expanding biogas projects, including waste management, greenhouse gas (GHG) emissions reduction, and increased renewable energy production.

The Potential of Biogas

Through a purification process, biogas can be upgraded to biomethane with a methane content of up to 90 percent, making it calorifically equivalent to natural gas. This upgraded biomethane is pipeline-ready and can seamlessly integrate into existing gas grids as a non-fossil gas, reducing carbon emissions.

Overcoming Challenges

Despite its numerous advantages, the biogas sector has faced challenges in gaining traction in India. The report identifies several key obstacles:

1. Market Ecosystem: The absence of a comprehensive market ecosystem hinders biogas growth.
2. Pricing Challenges: Complex pricing structures create barriers to entry.
3. Approval Processes: Cumbersome approval procedures slow down project development.
4. Fragmented Government Support: Fragmented government support lacks cohesion and consistency.

Government Initiatives and Progress

The Indian government has initiated steps to address these challenges. In 2021, various support mechanisms were consolidated under the National Bioenergy Scheme. Additionally, the GOBARdhan (Galvanizing Organic Bio-Agro Resources Dhan) scheme was introduced as an umbrella initiative, encompassing various policies to promote organic waste conversion to biogas or compressed biogas (CBG).

Private Sector Interest and Policy Developments

The report highlights recent policy developments, including revisions to the compressed biogas rate in response to global gas price increases and plans to mandate natural gas marketing companies to procure five percent compressed biogas. These measures have reignited private sector interest, with companies like Reliance Industries Limited and the Adani Group showing strong enthusiasm.

Unlocking Biogas’s Full Potential

However, the report emphasizes that more needs to be done to fully unlock biogas’s potential in India. Key recommendations include:

1. Increased Investments: Encouraging greater investments and private sector involvement.
2. Market Viability: Improving market viability for CBG and biogas slurry.
3. Financial Access: Increasing financial access for biogas plant development.
4. Feedstock Mapping: Promoting feedstock mapping to ensure input availability.

Environmental Considerations

It is crucial to ensure that energy crops are not used for biogas production, as this could lead to indirect land use changes with detrimental impacts on climate and the environment, similar to the experiences with ethanol and biodiesel in Brazil. This highlights the importance of sustainable feedstock choices.

Month: Current Affairs - October, 2023

Category: Environment Current Affairs • Reports & Indexes Current Affairs