Why are Giants like Reliance, Adani, and Indian Oil Betting on Biogas?

The history of biogas dates back to 1897 when Charles James, a British civil engineer, established the country’s first biogas plant while working on the homeless leper asylum’s drainage in Matunga, Bombay. Ever since, the green fuel – biogas has been a popular source of energy among Indian households, dairy farms, and community facilities.

The production of green fuel in India is on the constant rise. With their fast-paced development, the industry is captivating the interests of leading players like Adani, Indian Oil, and Reliance.

Green fuel or compressed biogas is obtained after biogas purification. The properties of CBG are similar to that of CNG (Compressed Natural Gas) and can easily substitute CNG for several purposes, including industrial, commercial, and automotive applications. Now that you know of CBG, let us explore how industry players plan to contribute towards biogas production.

• The Indian Biogas Association estimates that 5000 Biogas plants will be installed by 2030 with a tentative investment plan of about 1.75 lakh crore.
• Reliance Industries announced its plan to set up 100 CBG (Compressed Biogas) plants, signaling a shift to green energy sources.
• Adani Group’s Adani Total Gas plans to establish five compressed biogas plants in the upcoming five years to expand even more.
• Thermax, a leading environment and energy solutions company based in Pune, plans to launch Thermax Bioenergy Solutions in collaboration with EverEnviro Resource Management to set up multiple bio-CNG projects.
• According to an industry insider, EverEnviro plans to invest around INR 10,000 crore in the energy sector over the years. Moreover, their subsidiary GGEF (Green Growth Equity Fund) has plans to set up 14 compressed biogas plants across the country.
• Indian Oil Corporation, BPCL (Bharat Petroleum Corporation), and HPCL (Hindustan Petroleum Corporation) have issued several letters of intent for the setup of CBG (Compressed Biogas) plants.

Why are These Businesses Interested in the Production of Biogas?

According to the Chairman of IBA (Indian Biogas Association), Gaurav Kedia, “It’s the technical, financial, and social aspect of biogas. The technology is now getting mature, so people can now set up large-scale biogas plants.”

Mr. Kedia also believes they have the government’s support for the financial part and a ready market for green fuel. He further said, “The organic fertilizer from these plants is gaining popularity, particularly in the wake of the COVID-19 pandemic, which heightened health consciousness. These factors combine to make the biogas sector highly lucrative at present.”

Organizations like GAIL and IBA are trying to integrate compressed biogas or biomethane in the city’s gas grids. While GAIL embraced the green fuel, IBA advocated for a well-paid and fair price of FOM (Fermented Organic Manure), also known as organic fertilizer, set around INR 5.5 per kg. The initiative aims to strengthen the operations of biogas plants in the nation.

To support these initiatives and efforts, the government announced the MDA (Market Development Assistance) scheme with an initial budget of INR 1,451 crore to promote organic fertilizers.