The organic route to energy security

The Indian government has been proactive in leveraging biofuels to address energy security and sustainability. Landmark initiatives like the Ethanol Blending Program (EBP) aim to reduce fossil fuel dependence. The program has set ambitious targets, raising the ethanol blending mandate to 20 percent by 2025-26, originally set for 2030, underlining the government’s commitment to renewable energy.

Complementing ethanol, bioCNG production has gained momentum as part of a broader biofuel strategy. The updated National Biofuels Policy 2022 introduced measures such as minimum pricing for ethanol and bioCNG to attract private investment and promote adoption in transportation and power generation. Achieving the 20 percent ethanol blending target could yield environmental benefits by cutting CO₂ emissions by 74 million metric tons annually and saving Rs 30,000 crore in oil imports, according to the Ministry of Petroleum and Natural Gas.

Moreover, the government’s Compressed Bio-Gas Blending Obligation (CBO) initiative represents a paradigm shift in biofuel policy. By mandating the phased blending of Compressed Bio-Gas (CBG) into CNG (transport) and PNG (domestic) sectors, the program aims to achieve a 5 percent blending ratio by 2028-29. This policy is projected to attract Rs 37,500 crore in investments and establish 750 CBG plants, driving a circular economy. Additionally, a study by the Indian Biogas Association estimates that a 5 percent blending could reduce LNG imports by Rs 10,000 crore annually, reinforcing India’s energy independence.

Challenges ahead

Despite its immense promise, India’s biofuel sector faces several challenges that must be overcome to scale production and meet ambitious government targets.

# Feedstock Availability and Supply Chain Gaps: India’s bioethanol production has traditionally relied on molasses or grains like maize and rice—resources that are finite and seasonally variable. A sustainable approach requires diversifying feedstock to include lignocellulosic biomass like paddy straw, wheat straw, bagasse, and cotton stalks. Fast-growing, low-water crops such as napier grass, bamboo, and sweet sorghum could also play a pivotal role, particularly on non-arable lands. However, the current biomass supply chain is fragmented, with inefficiencies in collection, storage, and transportation. Building an integrated, cost-effective supply chain will be essential to unlocking this vast resource potential.

# Inefficiency in feedstock pre-treatment: Lignocellulosic materials require complex pre-treatment processes to break down lignin and make cellulose accessible for biofuel conversion. Existing pre-treatment methods are expensive, energy-intensive, and unsuitable for large-scale operations.

# Dependence on imported technology: India's biofuel sector has largely relied on imported technologies, which often fail to align with local feedstock varieties and climatic conditions. Such dependence increases costs, elongates project timelines, and limits self-reliance.

# Bio-Sludge Management: Biofuel production, particularly bioCNG, generates significant bio-sludge, a by-product that poses environmental and operational challenges.

Addressing these challenges will require coordinated efforts involving government policies, private-sector investment, and academic research to build a sustainable, self-reliant biofuel ecosystem in India.

Solutions that will boost the sector

# Collaboration between the stakeholders: The biofuel sector cannot succeed in isolation. Government bodies, private sector companies, research institutions, and farmers must work together to create an ecosystem that supports biofuel production and innovation. Collaborative platforms can facilitate the sharing of knowledge, research, and resources, helping to bridge the gap between policy goals and practical implementation.

# Indigenous R&D and technology development: Relying on imported technologies will not ensure long-term sustainability for India’s biofuel sector. The country needs to invest in indigenous research and development to create biofuel technologies that are tailored to its unique agricultural feedstocks and climate conditions.

# Strengthening the biomass supply chain: For biofuels to become a viable large-scale solution, India must build a more robust and efficient biomass supply chain. This includes engaging with farmers and rural communities to secure a consistent and affordable supply of agricultural residues.

# Policy Support and incentives: The Indian government must continue to provide policy support that incentivizes biofuel production and innovation. This could include expanding tax breaks, subsidies, or preferential treatment for projects that use local technology or prioritize sustainable feedstocks. Further, clear and predictable regulatory frameworks will encourage more private sector investment in biofuel infrastructure and technology.

(Nitin Gupta is Global CEO of Advanced Manufacturing at STEER World.)

Views are personal and do not represent the stand of this publication.