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The Centre is considering revision of the National Policy on Bio-fuels of 2009. Poor implementation of the policy in the past has kept the goals unrealised and called for modifications, particularly in the case of bio-diesel.
According to bio-diesel industry sources, the Union Ministry of New and Renewable Energy has called a meeting with the representatives of Biodiesel Association of India on December 21 to discuss the issues, including introduction of a mandatory level of bio-diesel that could be incorporated in the proposed policy amendments.
S K Mondal, Vice-President (East) of India, told BusinessLine that the association was looking for a mandatory provision for use and mixing of bio-diesel in transport fuel by the oil marketing companies. The industry body also wants to iron out the pricing and tax issues.
The 2009 policy had set an indicative target of 20 per cent blending of bio-fuels, both for bio-diesel and bio-ethanol, by 2017. Later, the government made 5 per cent use of bio-ethanol.
The use of bio-diesel is still not mandatory. However, oil marketing companies – IOC, HPCL and BPCL have recently taken steps to start purchasing of bio-diesel from the producers.
“OMCs floated tenders for small quantities of bio-diesel. Supplies would begin from this month,” Mondal said. Besides this, the Ministries of Railways and Shipping have prompted the railway and port authorities to start using bio-diesel.
After 2009 policy announcement, some 25 bio-diesel units had come up in the country with an installed capacity of 1.2 million tonnes a year. However, currently only five units are operational. “Even they have substantial underutilised capacities. Once demand starts flowing in, unused capacities could return to make available more supplies”, BAI official said.
Aditya V Agarwal, Director of Emami group of companies, said Emami Agrotech Ltd had set up 300 tonnes per day capacity for bio-diesel. “But, currently we are able to utilise only a third of our capacity at our Haldia plant because of inadequate demand,” he added.
Agarwal said if assured of steady demand through the introduction of mandatory use of bio-diesel, Emami was willing ramp up capacities through fresh investment.
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