Proposed 5% biogas blending with natural gas can cut LNG imports worth $1.17 billion: IBA

Proposed 5% biogas blending with natural gas can cut LNG imports worth $1.17 billion: IBA

The proposed 5 per cent blending of biogas with natural gas supplies in the country can cut LNG imports worth USD 1.17 billion annually, says a study by the Indian Biogas Association (IBA).

The study comes against the backdrop of the government's recent mandate to blend one per cent biogas with piped natural gas (PNG) supplies in the country from April 1, 2025 under the compressed biogas blending obligation (CBO) scheme.

The biogas blending is proposed to be further increased to 5 per cent by fiscal year 202829. According to the study, this blending initiative gels well with the government's macro-level move to make India a gas-based economy, with a target to increase the current share of gas in the energy mix from 6 per cent currently to 15 per cent by 2030.

The IBA estimates show that 5 per cent blending of biogas with natural gas can reduce LNG imports worth USD 1.17 billion. This can also bring down per capita CO2 emissions by two per cent, benchmarked to the 2019 figure, which was 1.9 metric tonne of CO2 per person in India. Additionally, the body says preventing organic waste going to landfills can bring innumerable benefits.

The CBO scheme shall encourage investment of around Rs 37,500 crore and facilitate the establishment of at least 750 compressed bio gas (CBG) projects by 202829, as per government estimates. This is going to improve India's energy security, as it is currently heavily reliant on imported natural gas to meet its energy needs.

Blending biogas with PNG and CBG can help reduce this dependence, which is invaluable. Biogas blending has the potential to demonstrate a positive correlation with agricultural income growth too, which is the case with ethanol as well.

Every additional large-scale plant can ensure that almost 1,000 acre of nearby biogas plant area can be converted into organic agriculture. Biogas can be produced from various organic waste sources, such as agricultural waste, municipal solid waste, and food waste.

This can create new economic opportunities for farmers, waste management companies, and other stakeholders involved in biogas production. Blending of biogas with natural gas will streamline the market for biofuels, making it more investor-friendly by reducing capital and operational costs, the body says.

It also needs to be emphasised that selling biofuels in the market will become smoother, and the ecosystem will benefit from increased investor confidence, IBA stated.